Minister of Power, Adebayo Adelabu has disclosed that the electricity subsidy has been reduced to N1 trillion from about N3 trillion due to the introduction of band A with a higher tariff.
The minister made this known on Tuesday at the public hearing on electricity tariffs in Abuja.
The hearing was organised by the House of Representatives Joint Committee on Power, Commerce, National Planning, and Delegated Legislation.
Adelabu said the expected subsidy would have been close to N3 trillion without an increase in electricity tariffs.
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He said the Federal Government could not afford to pay N3 trillion in subsidies.
The minister said that instead of piling up debt for the government, the ministry came up with a model for customers to pay for subsidies on band A.
According to him, this will compensate for the fuel and diesel that consumers are using.
He said that what consumers spend now is cheaper compared to fuel and diesel, even with the increase in electricity tariff.
“We are still about the cheapest, even in sub-Saharan, in spite of the tariff. Our neighbouring countries pay higher. So the price isn’t comparable.
“Band A is cheaper compared to other sources of generating power. It is almost 50 percent cheaper to connect to band A of the national grid than to run on fuel and diesel.
“So when we complain about the higher tariff, it is cheaper for any business to pay for a grid connection than to individually generate power,” he said.
He said President Bola Tinubu`s administration meant well for Nigerians, adding that he would not aggravate an already bad situation in the country.
“We are out to make things better for Nigeria and to create industrial development through our local manufacturing, and energy is needed to do this,” he said.
The minister said the increase in tariff was not targeted at making life difficult for Nigerians but to make life affordable for the people.
Kazeem Badmus is a graduate of Mass Communication with years of experience. A professional in journalism and media writing, Kazeem prioritses accuracy and factual reportage of issues. He is also a dexterous finder of the truth with conscious delivery of unbiased and development oriented stories.
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