The Federal Government has underscored the necessity of an annual investment of $10 billion over the next ten years to rejuvenate Nigeria’s power sector. Minister of Power, Adebayo Adelabu, made this assertion during a one-day investigative hearing in Abuja aimed at halting the recent electricity tariff increase proposed by the Nigerian Electricity Regulatory Commission (NERC).
Adelabu highlighted that the substantial investment was crucial to resolving the liquidity crisis and reviving the nation’s power sector. He also disclosed plans for the allocation of N2.9 trillion to achieve full sector subsidy.
In response to the recent decision to increase electricity tariffs for band A customers, Senators have called for urgent action to reverse the decision. The investigative hearing, led by Senator Enyinnaya Abaribe, Chairman of the Senate Committee on Power, focused on various issues including the required subsidy payment, outstanding debts in the sector, metering challenges, and debts owed to gas companies.
Adelabu emphasized that the absence of liquidity posed a significant challenge to the sector, resulting in accumulated liabilities owed to Generating Companies (GenCos) and Gas Companies. He highlighted the government’s limited resources as a hindrance to paying the outstanding subsidy, urging Senators to support measures to sustain the sector.
The Minister assured that customers receiving less than 20 hours of power supply would not be subjected to the new tariff increase. He also outlined plans to acquire eight million meters over the next four years to address metering challenges.
Furthermore, Adelabu stressed the importance of attracting investors to the sector by implementing commercial pricing. He cited ongoing investments in hydroelectric power, including the construction of the Zungeru Hydroelectric Power Plant and 26 small hydropower dams across the country to boost electricity production.