The Federal Government of Nigeria has announced plans to review electricity tariffs for Band B and C customers to correct billing disparities and encourage further investment in the power sector.
Unfair Pricing Structure Under Review
Minister of Power, Adebayo Adelabu, revealed that under the current system, Band B customers—who receive between 17 and 18 hours of electricity daily—pay N63 per kilowatt-hour, while Band A customers, who receive only two additional hours of power, are charged a significantly higher rate of N209 per kilowatt-hour.
Adelabu described this pricing model as "unfair" and stressed the need for a more balanced approach that accurately reflects the supply levels across different consumer categories.
Understanding the Service-Based Tariff System
Nigeria's electricity tariff system classifies customers into different bands based on the number of hours of electricity supply they receive daily:
- Band A: 20 hours or more
- Band B: 16 to 20 hours
- Band C: 12 to 16 hours
- Band D: 8 to 12 hours
- Band E: 4 to 8 hours
The government introduced this classification to align electricity pricing with the quality of service provided. However, the system has been met with criticism, particularly concerning the migration of customers between bands.
Labour Union Opposition and Subsidy Challenges
In January 2025, Nigeria Labour Congress (NLC) President Joe Ajaero strongly opposed the band migration process, calling it "the highest level of 419" and raising concerns about potential discrimination in band classification.
Despite previous tariff hikes, the government continues to subsidize electricity. Minister Adelabu noted that in 2024, even after raising tariffs for Band A customers, the government still covered 67% of the total production, transmission, and distribution costs, amounting to about N1.8 trillion in subsidies.
A More Equitable Billing System on the Horizon
The planned tariff review aims to establish a fairer billing system that ensures consumers are charged based on their actual electricity
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