The Nigerian Electricity Regulatory Commission (NERC) has stated that the newly approved electricity tariff is anticipated to cut down the subsidy for the fiscal year 2024 by approximately N1.14 trillion.
Mr. Musliu Oseni, the Vice Chairman of NERC, made this announcement in a statement in Abuja on Wednesday.
According to Oseni, the Federal Government has shown interest in transitioning to a targeted subsidy regime to alleviate the effects of macro-economic changes.
''With the newly approved tariffs, subsidies for the 2024 fiscal year are expected to reduce by about NGN1.14 trillion in furtherance of the Federal Government’s realignment of the subsidy regime.
''While largely protecting vulnerable customers and fostering investments targeted at providing efficient service delivery in the Nigerian Electricity Supply Industry (NESI).
''The overarching objective of the commission in the consideration of the tariff application is the creation of a financially sustainable electricity market providing adequate and reliable power supply to drive the Nigerian economy.
''While largely protecting vulnerable customers and fostering investments targeted at providing efficient service delivery in the Nigerian Electricity Supply Industry (NESI).
''The overarching objective of the commission in the consideration of the tariff application is the creation of a financially sustainable electricity market providing adequate and reliable power supply to drive the Nigerian economy.
''The commission, upon due consideration of the tariff applications, has approved revised rates affecting only customers classified under Band Serv category which is about 15 per cent of the customer population,'' he said.
Oseni further explained that the commission undertook a detailed assessment of the tariff proposals submitted by the 11 Electricity Distribution Companies (DisCos), adhering to its established regulations and business principles.
He mentioned that before the review process, there was an examination of the performance improvement plans of the licensees, which also includes a public hearing.
During this process, stakeholders and interveners scrutinized the rate filing presented by the public utilities.
Oseni said that empirical service data confirmed that this class of customers had truly received the committed level of service.
He added that a mechanism for enforcement and compensation has been set up to address service failures subsequently.
''All DisCos have been provided with mandatory targets for investments and migration of more customers to Band.
''The commission has established a robust monitoring framework leveraging on technology to ensure that the public has visibility of the service covenant with their service providers.
''We wish to assure all Nigerians that the commission working in collaboration with the policymakers remains committed towards providing adequate and reliable electricity to all citizens.
''This is as we work diligently with state governments to deliver on the gains of the Electricity Act 2023,'' Oseni added.
Oseni further explained that the commission undertook a detailed assessment of the tariff proposals submitted by the 11 Electricity Distribution Companies (DisCos), adhering to its established regulations and business principles.
He mentioned that before the review process, there was an examination of the performance improvement plans of the licensees, which also includes a public hearing.
During this process, stakeholders and interveners scrutinized the rate filing presented by the public utilities.
Oseni said that empirical service data confirmed that this class of customers had truly received the committed level of service.
He added that a mechanism for enforcement and compensation has been set up to address service failures subsequently.
''All DisCos have been provided with mandatory targets for investments and migration of more customers to Band.
''The commission has established a robust monitoring framework leveraging on technology to ensure that the public has visibility of the service covenant with their service providers.
''We wish to assure all Nigerians that the commission working in collaboration with the policymakers remains committed towards providing adequate and reliable electricity to all citizens.
''This is as we work diligently with state governments to deliver on the gains of the Electricity Act 2023,'' Oseni added.
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