By Abdulrahman salihu
Electricity is one of the most crucial factors in the development of every industrial country, which factories, financial hubs, and technological companies rely heavily upon for their operations.
In Nigeria, on 1st April 2024, the Nigerian Electricity Regulatory Commission (NERC) increased the price of Kilowatt per hour by 300% from N68 Naira to N225 Naira to urban Customers popularly known as “Band A” customers, who are 15% of the total number of Electricity Consumers in the country.
The electricity tariff increment comes after President Bola Ahmed Tinubu removed the fuel subsidy in his inauguration speech on 29 May 2023, which triggered massive hyperinflation in Nigeria that resulted in hikes on almost every commodity and inflicted severe suffering among Nigerians.
The Nigerian Electricity Regulatory Commission (NERC) has claimed that the hike in the electricity tariff will only affect the “Band A” customers. Therefore, the remaining 75% of customers (Band B-C-D-E) who get less than 20 hours daily will not be affected.
However, the multiplier effect of the tariff increment dramatically influences the cost of production of foodstuff processing companies, manufacturers and other producers of goods that the masses use, thereby affecting the price of commodities.
Moreover, some artisans and small business owners have been put out of business because the financial institutions will increase the interest rate to meet the electricity tariff hike, making it unaffordable to businesses that take loans from them, rendering the artisans jobless. Businesses will collapse in the long run.
On the other hand, the government may not be able to generate revenue from the businesses that shut down, so also the artisans and craftsmen will not get customers as a result of lack of adequate electricity in their “Band”, which will make them unable to pay taxes to the government.
Therefore, as a matter of urgency, the federal government and the stakeholders in the power sector should suspend the electricity tariff increment and invest in modern solar power plants. This will generate more power for the country and will go a long way in mitigating global warming and climate change.
The federal government should also find ways to improve the electricity supply, as the current supply is insufficient to make things work effectively.
The governors of hydroelectric power-producing states should initiate policies and partner with international investors to boost power generation for their states and the country. At the same time, the other states should also render support where necessary.
This will encourage foreign investors to troop to Nigeria for investment, bringing job opportunities and facilitating unprecedented revenue flow into the accounts of both the federal and state governments.
Abdulrahman Salihu wrote via abutalatu72@gmail.com.