In a stark warning issued yesterday in Abuja, the Minister of Power, Adebayo Adelabu, announced that Nigeria could face a total blackout within the next three months unless a proposed electricity tariff hike is implemented. The Minister made these remarks during his appearance before the Senate Committee on Power, which is currently examining the recent tariff adjustments announced by the Nigerian Electricity Regulatory Commission (NERC).
This alarming news comes after the Senate committee, chaired by Senator Enyinnaya Abaribe, expressed its opposition to the new tariff regime, highlighting the potential impact on already burdened Nigerian consumers.
Minister Adelabu emphasized the dire state of the national power sector, explaining that without an increase in tariffs, the sector is likely to collapse, plunging the entire country into darkness. "The entire sector will be grounded if we don’t increase the tariff," Adelabu told the committee. "With what we have now, in the next three months, the entire country will be in darkness if we don’t increase tariffs."
According to Adelabu, revitalizing Nigeria’s power sector would require an investment of $10 billion annually over the next decade. He argued that the government alone cannot shoulder this financial burden due to its limited resources. He stressed the necessity of making the sector more appealing to investors and lenders through "commercial pricing."
“If the value is still at N66 and the government is not paying subsidy, the investors will not come," he explained. "But now that we have increased the tariff for A Band, there are interests being shown by investors."
The Minister also disclosed the government’s inability to cover an outstanding N2.9 trillion subsidy, underscoring the urgency of evolving sustainable measures to support the sector. He appealed to the lawmakers to facilitate the repayment of debts owed to operators throughout the electricity value chain, including generation, transmission, and distribution sectors.
However, the Senate Committee on Power remains cautious, voicing the hardships that the tariff hike could impose on Nigerians. Senator Enyinnaya Abaribe urged the Minister and other stakeholders in the power sector to consider alternative solutions that could alleviate the sector's financial strains without overburdening consumers.
Senators Simon Lalong and Adamu Aliero criticized the lack of prior consultation before implementing the tariff increase, suggesting that palliatives could have eased the transition for consumers.
The hearing also touched on other pressing issues in the power sector, including the nonappearance of the company ZIGLAKS, which has been implicated in a failed agreement to supply prepaid meters to Nigerian consumers, despite having received N32 billion over two decades.
As the debate continues, stakeholders from various sectors, including the Nigerian Electricity Regulatory Commission, the Manufacturers Association of Nigeria, and representatives from Generation and Distribution Companies, presented their perspectives, aiming to shape a policy that ensures both the stability of the power sector and the economic welfare of the Nigerian populace.
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