The Presidential Task Force on Power has said reduction in electricity tariff is to be announced by the Nigerian Electricity Regulatory Commission, NERC, in April.

A statement by Mr Abimbola Agboluaje, Head, Media and Communications of the Task Force and made available to News Agency of Nigeria, NAN, yesterday, stated that the new tariff would reduce the cost of electricity by 65 per cent.

“The poorest Nigerians pay more than N80 per kwh, burning candles, kerosene and firewood while the majority of Nigerians pay N50 to N70 on self-generation and manufacturers pay between N45 and N60 per kwh on diesel or LPFO generation, using larger generators,” the statement stated..

It said that would attract new capacity to the power sector as the cost of electricity on businesses and individuals, as well as on prices of goods and the rate of inflation in the country, would be reduced.

According to the statement, the average cost-based tariff of consumers will fall between N21 to N23 per kwh; about a third of what Nigerians actually pay for electricity.

It said government decided to reform the sector because the “nominal tariff” was blocking investment into the power sector and the larger Nigerian economy.

It further stated that the fall in the tariff, alongside other benefits Nigerians would gain, was as a result of the current reform in the power sector.

It said: “Analysis of the reduction in the price Nigerians pay for electricity does not use the universally subsidised tariff as a reference; this is regarded as a ‘nominal price’.

“Rather it is based on the ‘real cost’ which a majority of Nigerians really pay to consume electric power during the 60-70 per cent of the time when public power supply is unavailable at the subsidised tariff.

“Urban poor and rural dwellers will pay even less with ‘Protective Lifeline Tariff’.”

According to it, if the reform of the power sector proceeds, it is critical that Nigerians understand that neither the Federal Government nor electric power companies will determine electricity tariffs.

It said that investors should be sure that the regulator would set tariffs based on the fair costs of producing and distributing power rather than set “politically popular rates”.

The Task Force also stressed that NERC’s main role was to create conditions that stimulate investment and also bring about the competition and efficiency required to deliver the greatest value to consumers.

“NERC is currently conducting consultations and studies to determine the fairest and most efficient tariff and only the tariff announced by it can be regarded as the actual new tariff’’, the  statement stated.