Hardship: Don’t remove electricity subsidy, Senate tells FG

The Senate on Wednesday urged the federal government to stop the planned withdrawal of electricity subsidy. The Minister of Power, Adebayo Adelabu, had last week said the government could no longer pay electricity subsidies as the country’s power debt continues to rise. Adelabu said the Nigerian government is currently indebted to the tune of N1.3 […]

The Senate on Wednesday urged the federal government to stop the planned withdrawal of electricity subsidy.

The Minister of Power, Adebayo Adelabu, had last week said the government could no longer pay electricity subsidies as the country’s power debt continues to rise.

Adelabu said the Nigerian government is currently indebted to the tune of N1.3 trillion to generating companies (GenCos) while debt to gas companies stands at $1.3 billion.

He stated that only N450bn was earmarked for electricity subsidy in the 2024 budget, even though findings by the Nigerian Electricity Regulatory Commission (NERC) showed that N2.9tn is required for subsidy this year.

The Senate, following a motion by Senator Aminu Iya Abbas and 10 others, urged the federal government to stand down the idea of an increase in electricity tariffs that will result from withdrawing the subsidy.

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It also mandated its Committee on Power to investigate the over N2 trillion subsidy requirements as stated by the Minister of Power to avoid a repeat of the fuel subsidy scenario.

The probe, it said, should also include the power minister’s claim that the federal government owed generating companies (GenCos) N1.3 trillion and $1.3 billion to gas firms.

Senator Abbas, in his motion, said the plan to increase electricity tariff was in gross disregard of increased economic challenges with attendant widespread poverty and high cost of living.

He said while the power minister advocated for a cost-effective tariff model, the power distribution companies were collecting money from customers for services not rendered.

“Communities buy transformers to replace damaged ones in addition to overburden bills and arbitrary estimates for unmetered customers.

“In a country where a greater number of the population lives below the poverty level, with stagnant wages, rising inflation, and depreciating currency, the prospect of higher electricity bills is unattainable.

“The issue of arbitrary energy charges on unmetered customers has become worrisome given the February 2024 report of the Nigerian Electricity Regulatory Commission (NERC) on the non-compliance with energy billing caps by DISCOS and the penalty of ₦10.5 Billion imposed on the distribution companies that over-billed its unmetered customers,” the lawmaker said.

The Senate, therefore, asked the government not to phase out electricity subsidies.

It also asked the Committee on Power to investigate the Ministry of Power, NERC, and Ziglaks company on their roles in the failed agreement to provide prepaid meters and ensure Nigeria is not shortchanged.

The committee was also mandated to probe the operations of DISCOs to ascertain the current status of metering and their extent of compliance with relevant legal and regulatory frameworks in service delivery.

Daily Trust reports that this is the second time the Senate will be asking the federal government to shelve a planned increase in electricity tariff.