Sam Amadi, Director of the Abuja School of Social and Political Thought, has labelled the proposed electricity tariff increase for Nigerians as unusual and unjustifiable.
In an interview on News Central’s Breakfast show, Mr Amadi argued that there is no valid reason for the tariff hike, emphasising the need for transparency and clear justification for such a move. He drew comparisons with developed nations, where electricity tariffs typically rise when there is significant investment in infrastructure to improve power supply, and operators seek to recover those investments.
This comes as Olu Verheijen, Special Adviser to President Bola Tinubu on Energy, revealed at the Africa Heads of State Energy Summit in Dar es Salaam, Tanzania, that Nigeria’s electricity tariffs will rise within the coming months.
On April 3, 2024, the Nigerian government approved a threefold increase in electricity tariffs for Band A customers. Verheijen explained that power prices need to rise by approximately two-thirds (66%) to more accurately reflect the true cost of electricity supply for many consumers.
“What’s happening in the electricity sector is unusual. Usually, when prices increase, there are three things that happen. One is either there are new investments that are made which improve power supply, and then the operators need to recoup those returns, and so you can see small adjustments in prices and costs. Or there is an emergency, countries with hurricanes, and therefore you need to invest quickly to ramp up, to restore the same level of supply, and then those costs have to be approved and somehow amortised with small increases,” Mr Amadi stated.

The former Nigerian Electricity Regulation Commission (NERC) chairman stated that when the tariff increase was approved, they discussed it with some NERC officials, expressing concern that the regulatory body was being pressured to respond to the currency crisis and inflation by raising tariffs without substantial improvements in quality or new investments.
He highlighted that the rise in energy costs would negatively impact small and medium enterprises. He also criticised NERC for categorising the increase under Band A, arguing that nearly everyone had been pushed into this category.
“I’ve said that before when this tariff was approved, the so-called band A and B and C, I spoke with some of the NERC officials. I said, look, what we are doing is that the NERC is being forced to respond to the currency crisis and inflation by increasing tariffs without any serious improvement in quality or any new investment. So, yes, it’s going to affect small and medium enterprises because the unit cost of energy will go high. And what NERC did the last time was to say it’s for those that got band A. But the truth is that almost everybody’s been pushed to band A,” he added.
Amadi’s remarks highlight the importance of ensuring that tariff adjustments are grounded in tangible improvements and aligned with the broader goal of enhancing the energy sector.
Watch the interview below: