The federal government of Nigeria is set to end subsidy payments on electricity consumption by citizens and residents of the country. The special adviser to President Muhammadu Buhari on infrastructure, Ahmed Zakari made the disclosure, noting that the halt may be implemented by the end of 2021. He spoke during a recent webinar organized by the Abuja Chamber of Commerce and Industry (AICC).
On worries that plans by the government to end the subsidy will make electricity more unaffordable for the poor, the presidential aide replied that prices are high in Nigeria because the country doesn’t generate enough energy.
He added that the move would ensure a steady supply of electricity.
“With this enhanced metering on the service-based tariff, we can see the Nigerian electricity supply industry generating over N100 billion in the near to mid-term. This is very impressive,” Zakari said.
“The hypothesis that we have is that if you enhance payment discipline through metering the population, revenue will go up. We have proven that.
“We plan to eliminate subsidy by the end of the year. People will say if you eliminate subsidies, you will have poor people pay more. But our argument is that the only reason the power prices in Nigeria are high is that we don’t generate enough.
“If you generate 10GW of power, the tariff will be half of what it costs. So, keeping the prices very low is not the approach, but delivering adequate power,” This Day reported him to have said.
The Minister of Power, Saleh Mamman, revealed in February that the federal government spends over N50 billion monthly on subsidizing electricity.
