Photograph — Siemens

The Nigerian Electricity Regulatory Commission (NERC)  has been advocating for the implementation of cost-reflective tariffs in Nigeria’s electricity supply industry, stating that electricity consumers in the country will start paying increased monthly tariffs by the end of October 2015. But while many consumers have complained about not seeing any appreciable improvements in power supply, the latest increase in Nigeria’s power generation capacity may suggest otherwise.

Mrs Seun Olagunju, the Director, Public Affairs, Transmission Company of Nigeria (TCN), says the nation’s power generation capacity has increased from 3,657 megawatts to 4,600 megawatts. Olagunjun als0 noted that power generation stood at 4,600 megawatts as of October 16, and only started increasing early this week. This development comes after operations resumed at the Egbin Power Station early this week, bouncing back to 813 megawatts barely a week after it recorded zero generation due to a certain workers’ crisis at the plant.

The Egbin power plant contributes about 20 percent to the overall output in the country. However following the workers’ crisis incident, nearly 1,000mw was lost, cutting supply to electricity users.

Should Nigerian’s pay more to have stable electricity supply?

In a recent interview, the Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, while discussing the issue of electricity tariffs, stated that Nigerians must be prepared to pay more for electricity. “[…] for you to have good electricity supply, you need to pay a little more,” he said. He also noted that some improvement has been recorded in generation, even though the wheeling capacity was limited.

Funds have been set aside for distribution and generating companies, as well as gas firms. However there has been a delay in disbursing these funds as some issues needed to be resolved with the Nigerian Electricity Bulk Commission as well as NERC.  There have also been talks about investing more into the transmission grid. “Government, realizing that the transmission capacity may be hindered, is already taking steps on how to invest in transmission, so as to improve capacity in that area,” he concluded.

Nigerian opinion polling and research organization, NOI polls, recently released a report stating that Nigerian households received an average daily cumulative power supply of 10.8 hours daily in September 2015. This not only represents a significant turn around, it is also the highest average daily cumulative power supply received over a 30 month period (April 2013-September 2015).

noi polls

The reduced use of power-generating sets – one of Nigeria’s alternative sources to power supply – will lead to a reduction in the volume of petrol bought to fuel them. It’s expensive to use generating sets. Tolu, a banker in Ibadan said “servicing and maintenance alone was a big amount. I also used to spend about a thousand naira on fuel every two days which is approximately 3000 naira in a week. Imagine the amount in a month. I don’t spend that much on my NEPA (National Electric Power Authority) bills.” Therefore improved power supply will also mean that Nigerian’s will save more, with enough reserved to handle electricity tariffs.

For more insight, listen to the podcast below

Elsewhere on Ventures

Triangle arrow