Tinubu’s Administration Halts Electricity Tariff Hike, Pledges Investigation into Power Sector Licenses
In a significant move, the administration led by President Tinubu has taken a firm stance against the proposed increase in electricity tariff.
The government has emphasized the need for subsidies to be allocated for power consumption nationwide.
Minister of Power, Adebayo Adelabu, outlined the administration’s plan to scrutinize the legality of the five-year license extension granted to privatized power distribution and generation companies. These operating licenses are slated to expire on October 31, 2023.
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During a press briefing in Abuja, Adelabu underscored his commitment to holding non-performing chief executives accountable within agencies under the power ministry.
He emphasized that any executive failing to meet performance standards could face dismissal.
Addressing the call for a cost-reflective tariff, Adelabu elucidated, “You cannot jump overnight and implement the cost-reflective tariff.” He acknowledged that the power sector is a highly sensitive industry, necessitating a cautious approach to tariff adjustments.
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Adelabu reiterated that subsidies are currently provided by the government due to the gap between the cost-reflective tariff and the allowable tariff.
Regarding Nigeria’s power generation capacity, Adelabu expressed disappointment, stating, “About 4,000 megawatts of power generation in Nigeria was shameful and unacceptable.” He affirmed ongoing efforts to augment this capacity.
In a candid declaration, Adelabu emphasized that officials within the ministry and its affiliated agencies must deliver on their mandates. He conveyed President Tinubu’s directive that ministers must perform or face dismissal.
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Adelabu also critically assessed the privatization of the power sector in 2013, deeming it a misstep. He suggested that a commercialization approach might have yielded better results.
Furthermore, he indicated that the government retains the option to assume control of power distribution companies despite holding a 40 percent stake in these entities.
The minister disclosed that an investigation is underway to scrutinize the extension of power sector licenses, which was implemented prior to the current administration. This investigation aims to assess the legality and contractual validity of the extension.
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In response to inquiries about Nigeria’s power supply to Niger Republic, Adelabu clarified that the process has not commenced, emphasizing that the government is closely monitoring the situation in the neighboring country.
The Tinubu-led administration’s strategic approach to the power sector underscores its commitment to ensuring sustainable and reliable electricity supply for the nation.
Adelabu’s resolute stance and call for accountability within the sector signal a determined effort to drive positive change and progress.
