KPMG Analysis: Hike in Electricity Tariff
This week, we highlight the recent upward review of tariff by the Nigerian Electricity Regulatory Commission's (NERC) for customers under the Band A category (customers who receive a minimum of 20 hours electricity per day), effective from April 3, 2024.
According to the order released by the Commission, titled "April 2024 Supplementary Order to the Multi-Year Tariff Order – 2024”, it was revealed that Band A customers, constituting 15% of the nation's 12 million electricity consumers, who have been charged an average of ₦71.59/kWh will now pay an increased tariff of ₦225/kWh, representing a substantial rise of over 200% in electricity tariff. However, tariff for Bands B – E customers will remain unchanged at the rate payable since December 2022, pending further directives from the government. The reviewed tariff is based on an inflation rate of 31.7% and an exchange rate of ₦1,463 to the dollar.
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