NERC: FG may provide an electricity subsidy of N600 billion
NERC: FG may provide an electricity subsidy of N600 billion
NERC: Sanusi Garba, the chairman and chief executive officer of the Nigerian Electricity Regulatory Commission (NERC), has revealed that the federal government may be required to pay N600 billion in electricity subsidies.
He made this revelation on Tuesday in Abuja during the ministerial retreat on the Integrated National Electricity Policy and Strategic Implementation Plan.
“The Service-Based Tariff (SBT) was instrumental in reducing tariff subsidies,” he continued, “but from 2015 to 2022, the financial burden of tariff subsidies remained at NGN2.8tn.“
He clarified that the industry has faced threats to investments and sustainability due to low end-user pricing, inadequate DisCo collections, and revenue deficits.
In his submissions, the Minister of Power, Adebayo Adelabu, stated that to increase the Transmission entity of Nigeria’s (TCN) efficiency in transferring power from power-producing businesses to distribution firms, another entity must be established.
The Minister regretted that the TCN could not transmit the necessary amount of power since it was using outdated and decaying infrastructure.
Critiquing TCN’s appalling performance in the power supply sector, he pointed out that splitting it in two is the only option to overcome its inefficiencies.
He feels that to meet calls for the decentralization of the national grid into regional networks connected by a new, higher voltage national or super-grid, the restructuring must work in tandem with the changing State Electricity Market environment.
As opposed to 70.5 percent produced the previous year, he clarified that the country currently generates over 98 percent of its electricity from renewable sources.
”According to him, as of 2022, 70.5 percent of the country’s grid electricity was produced by thermal plants, 27.3 percent by hydropower, and 2.2 percent by solar and other power plants. The good news is that over 98 percent of the feedstock used to generate electricity in the nation is clean or transitional fuel.
