Home News Adebayo Adelabu: Tariff Hike Attracting Investors To Power Sector

Adebayo Adelabu: Tariff Hike Attracting Investors To Power Sector

Chief Adebayo Adelabu
Chief Adebayo Adelabu

Amid calls for the reversal of the Band A tariff hike, the Minister of Power, Chief Adebayo Adelabu, has stated that the policy is attracting local and foreign investors to the power sector.

The minister disclosed this recently when he launched a mobile substation in the Ajah area of Lagos State.

He said the investors included bankers, who had been avoiding the power sector due to a lack of liquidity.

According to Adelabu, the investors are coming back after they got information about the tariff increase that applies to 15 per cent of Band A customers.

“The revised tariff has led to renewed interest of investors in Nigeria’s power sector. This is a very good thing.

“All those people that have been running away from the sector, in terms of local and foreign investors; all the bankers that could not touch the sector with a long pole, they are now coming back, and they are interested in investing in the power sector; just because of the little increase we did for a small percentage of our electricity consumers,” Adelabu disclosed.

The minister, however, reiterated that the power distribution companies should desist from charging Nigerians the new tariff without a guarantee of 20 hours of electricity supply.

He noted that the ministry was working to protect the interest of consumers to save them from being extorted.

“Our people should not be cheated. There must be value for money,” he warned.

Responding to claims that Band A customers were being prioritised at the expense of other customers, Adelabu clarified that before the revised tariff, there was no stimulation of demand as DisCos were rejecting power allocated to them.

He said the revenue collection rate was so low among some customers, so, the DisCos were not encouraged to give them enough power.

“But the review of the tariff upward has done one good thing; it has stimulated demand. It is now mandatory for the DisCos to supply Band A (consumers) a minimum of 20 hours, which means they are taking power.

“The low level of generation we currently have is eating into our available power for the other bands. But we are ramping up output now. The case of DisCos rejecting power does not exist again. It is in their interest to make sure the infrastructure of other bands is worked upon so that they can be migrated to Band A, and that is more income for the sector.

“If other bands have low power supply now, it is temporary,” he remarked.

Adelabu promised that 1,200 megawatts would be added to the current 4,800MW to raise the generated power to 6,000MW by September.

The PUNCH recalls that the Nigerian Electricity Regulatory Commission had on April 3 hiked the tariff payable by customers categorised as Band A, stopping government subsidies in those areas.

From N68/kWh, Band A customers had their tariff raised to N225/kWh until Monday, when it was reduced by 8.1 per cent.

Meanwhile, organised labour had threatened to picket the offices of the NERC and those of the DisCos if the Band A tariff was not reversed.

Credit: punchng.com

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