The Minister of Power Adebayo Adelabu, says although customers were expressing dissatisfaction with the Band A tariff, they understood that it remained a more economical option compared to producing their own electricity using petrol and diesel.
Adelabu, indicated that it could cost private companies as much as N750 to produce one kilowatt-hour of electricity due to the elevated price of petrol.
Adelabu stated that the expense of generating power will amount to N950 for each kilowatt-hour for those utilizing diesel engines.
He contended that these costs exceed the N209 per kilowatt-hour that Band A customers are currently paying.
He said, “I need to correct an impression. There’s a section of the media that says this revenue is an additional burden on the consumers. No, it is not. It is just a mere reallocation of resources from what they used to spend on petrol and diesel. Now they are paying to enjoy a good power supply.
“But today that we have a more stable supply than we used to have, a lot of people do not spend on fuel again, not on diesel, not on petrol. Now, we are charging N209 as a full cost-reflective tariff for Band A, but for you to generate a kilowatt hour of power using a petrol generator to pay, at this rate of N1,000 per litre, it is going to be about N750 for a kilowatt-hour; and for diesel, it remains about N915.
“So, power sector consumers are like a beautiful bride that has now tried two matrimonies. If they want to be sincere, they know which of the husbands to remain with.
“So, we are adopting commercialisation in the sector to enable investors to have a line of sight to the return of their investments.”
