1.5 Million Band A Electricity Consumers to Pay N337.5 Million Every Hour

1.5 Million Band A Electricity Consumers to Pay N337.5 Million Every Hour

  • 1.5 million electricity consumers categorised under Band A will have to cough out a huge amount as bill
  • This number of customers, who are only about 15% of the total 12 million electricity consumers in Nigeria, enjoy a minimum of 20 hours of supply
  • The recent increase in electricity tariff has continued to generate a lot of criticism from both public and private quarters

Legit.ng journalist Victor Enengedi has over a decade’s experience covering Energy, MSMEs, Technology and the stock market.

An estimated 1.5 million electricity users falling within the Band A category, receiving a minimum of 20 hours of electricity supply, are projected to collectively expend approximately N6.7 billion within a 20-hour period.

This information is based on findings derived from an analysis of the updated electricity tariff structure.

Read also

Ikeja Electric, EKEDC upgrade more customers to Band A to enjoy 20hrs/day power supply

Band A consumers struggle with daily N6.7bn bill
The minister of power, Adebayo Adelabu, had estimated that the tariff increase affected only 1.5 million customers.
Photo credit – TCN, Ikeja Electric
Source: UGC

NERC increases electricity tariff

The Nigerian Electricity Regulatory Commission (NERC) recently announced an increment in the electricity tariff for Band A consumers, raising it from the existing N66 per kilowatt hour to N225, marking a substantial 240% surge.

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In 2020, NERC implemented the Service-Based Tariff (SBT) system to enhance service quality for end-users and ensure that electricity tariffs align with the level of service provided by Distribution Companies, determined by the duration of daily electricity supply.

The SBT framework includes several categories: Band B, which entails a minimum of 16 hours of electricity supply per day; Band C, providing a minimum of 12 hours; Band D, offering a minimum of 8 hours; and Band E, guaranteeing a minimum of 4 hours of daily electricity supply.

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A declaration from the NERC provided reassurance that the new tariff adjustment would not affect customers falling within Bands B to E.

The statement also revealed that customers categorised under Band A represent 15% of the country’s total 12 million electricity consumers.

Breakdown of what Band A customers will pay

The minister of power, Adebayo Adelabu, had estimated that the tariff increase affected only 1.5 million customers.

Upon deeper analysis conducted by Legit.ng, it was uncovered that the revenue generation for Distribution Companies (DisCos) can be calculated by multiplying the tariff rate of N225 per kilowatt hour by the 1.5 million electricity consumers.

This equates to N337.5 million for every hour of electricity consumption. When this figure is multiplied by 20 hours, which represents the minimum consumption duration under Band A, the result is a substantial sum of N6.7 billion.

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However, the recent increase in electricity tariff has sparked criticism from various quarters.

The organised private sector, including the Manufacturers Association of Nigeria (MAN), consumer advocacy groups, and social media commentators, have urged the Federal Government to reverse the hike promptly.

Ikeja Electric, EKEDC Upgrade More Customers to Band A

Meanwhile, Legit.ng earlier reported that Ikeja Electric Plc and Eko Electricity Distribution Company were permitted to incorporate extra Band A feeders into their respective networks.

The electricity distribution firms communicated these updates through individual announcements on their official social media channels.

While Ikeja Electric increased its number of Band A feeders by 34, EKEDC increased its own by 33 more.

Source: Legit.ng


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