The Federal Government has said that there will be no going back on the 45 per cent increase in electricity tariff, adding that a reversal will cost over N575 billion.
The Minister of Power, Works and Housing, Babatunde Fashola, made the statement in Abuja yesterday when he briefed the Senate Committees on Labour and Power during a public hearing on the new electricity tariff.
The Nigeria Electricity Regulatory Commission (NERC) in January announced a 45 per cent increment in electricity tariff. The Senate, after considering a motion at plenary in January, directed that the tariff be reversed to enable it conclude hearing on the case.
However, the minister explained that the new tariff could not be reversed as it was necessary for the market to survive.
“One of the reasons why the tariff had to go up was that a major component, a significant number of our power plant depends on gas and out of about 26 power plants that we have only about three are hydro. We were heavily dependent on gas, people were exporting gas because gas was selling outside the country at four dollars and it was selling for domestic use at one dollar,” he said.
The minister said even with the recent hike in electricity tariff, Nigeria was still among countries with the lowest electricity tariffs in Africa and the world.