NERC Announces Plan to Remove Electricity Subsidy

Nigerian Electricity Regulatory Commission (NERC) says it would recommend the scrapping of subsidy to low income consumers of electricity in the Residential- 1 and 2 (R-1&2) and Commerical-1 (C-1) cadres starting from 2014.

The Federal Government had in the 2012 budget appropriated N100 billion to subsidize electricity consumption, especially in Nigeria’s rural areas over the next two years. This will be discontinued should the NERC recommendation be accepted by Abuja.

According to the commission in the last lap of its ongoing Power Consumers Assembly (PCA) held in Amawbia, Nnewi and Onitsha, Anambra State at the weekend, that if possible, funds for such subsidy from the government would be channeled into other priority areas like provision of electricity of Nigeria’s rural communities in line with its rural electrification programme.

NERC’s General Manager, Government and Consumer Affairs, Dr.Tony Akah told consumers that the government is expected to run out of its outlay for subsidising consumers by next year and such, it may not provide more funds if there was no need to continue with it.

“In the new tariff that we have, the MYTO-2, there is a component of subsidy because what Nigerians are paying now is not the full cost and because we dont want the consumers to have a big shock, the regulator made recommendations to the government and they accepted and provided some funding.

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