It costs N120 to produce 1KwpH of electricity – Minister

The minister of Power, Adebayo Adelabu, has stated that the cost of generating a kilowatt per hour of electricity is N120, reasoning why the federal government is paying more on electricity subsidy. Speaking during an oversight visit by the Members of the House of Representatives on Power, the minister said the cost does not include […]

The minister of Power, Adebayo Adelabu, has stated that the cost of generating a kilowatt per hour of electricity is N120, reasoning why the federal government is paying more on electricity subsidy.

Speaking during an oversight visit by the Members of the House of Representatives on Power, the minister said the cost does not include other charges paid by power utilities in the Nigerian Electricity Supply Industry (NESI).

“Those in Band A are paying N209 while Band B is paying N65, the average cost of producing one kilowatt per hour of electricity. Its generating cost is not less than 120 before, we had the evacuation and wheeling and distribution charges. So anybody paying N65 or N58 is paying way below the cost and that is what the federal government is still subsidising.

He added that the government wants to accelerate the infrastructure in the sector to migrate “as much as possible, more customers to band A. That is what we have achieved today.”

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He added that if not for the recent protests, the ministry is considering reviewing the tariffs other bands pay to rescue the sector from illiquidity.

“Probably in the next 6 months, we may have to go to the president and present a new tariff policy that will dictate how much will be paid by other bands but we don’t want that route now. We just finished the protest and we don’t want anything that will trigger any protest. We have to be very sensitive.”

He added that for the first time in three years, the power sector has achieved generation, transmission and distribution of 5,155.99 megawatts of power.