The Nigerian Electricity Regulatory Commission, NERC, has confirmed the removal of electricity subsidy amounting to N600bn, as announced by the Minister of Finance, Zainab Ahmed.
Current situation:
The Federal Government of Nigeria subsidies several sectors, including education, petrol and electricity, to increase the purchasing power of its citizens. Considering the recent economic challenges Nigeria has come under, the Federal Government devised a plan to ease its financial responsibilities by removing subsidies from electricity, fuel and other sectors. Nigerians and lawmakers fought against removal of fuel subsidy. But as revealed by the Finance Minister, the Nigerian government has removed the subsidy on electricity amounting to N600bn a year.
What are they saying?
The NERC Chairman, Sanusi Garba, has said that the commission would review tariff plans every six months to meet foreign exchange quota and inflation.
The Minister of Finance, Zainab Ahmed stance is that the Federal Government has expunged subsidy from the power sector.
What does this mean?
The full removal of subsidy on electricity means that tariff plans would be relatively higher than previous rates. With the federal government’s stance that it has obliterated the subsidy on electricity, the current tariff plans might slightly increase or maintain its current rates.