- The Manufacturers Association of Nigeria has said electricity tariffs should be charged based on consumption not ‘bands’
- It said tariff charges by ‘bands’ are discriminatory and unjust
- MAN said high electricity tariffs are affecting critical sectors like manufacturing
The Manufacturers Association of Nigeria (MAN) says electricity tariffs should be charged based on consumption and not the ‘band’ system that currently obtains.
MAN added the categorisation of electricity consumers into ‘bands’ is discriminatory and not based on any scientific consideration, calling on the Federal Government to stop the system.
Director-General of MAN, Segun Ajayi-Kadri, stated this in an interview with Saturday PUNCH, and added that the band categorisation system was unjust as it didn’t take into account the income, household activities, and capacity of residents before placing them in a category.
“You should not in any way seek to introduce a concept like Band A, which is discriminatory and not based on any scientific consideration. It is very subjective to simply designate an area as Band A without considering certain factors.
“If someone’s total consumption is lower than a certain threshold, that person is likely to be poor and should not be in Band A. Conversely, those with higher consumption should pay more,” he said.
High electricity tariff affecting industries
Ajayi-Kadri further noted the impact of high electricity tariff on manufacturing industries in the country, adding that the government should provide some form of relief for the sector.
He stressed that the government should prioritise electricity supply to sectors crucial to economic growth, and called on the government to adjust the electricity tariffs and band system to ensure that they support consumers and businesses in Nigeria.
The different band categorisation
Electricity consumers in Nigeria are currently categorised into Bands A to E. Each category receives varying hours of electricity supply per day and is charged different rates.
Customers catgorised under Band A receive, who make up 15 per cent of the population of electricity customers in Nigeria and consume 40 per cent of electricity, receive a minimum of 20 hours of electricity daily.
Following electricity subsidy removal in February 2024, electricity consumers in Band A category were made to pay N225 per kilowatt hour (kWh), a 300 per cent increase from the previous N68/kWh.
The tariff was later reduced to N206.80/kWh in May 2024 following public outcry from customers, labour unions, and manufacturers.
However, the tariff for Band A customers was later increased by N2.70/kWh to N209.50/kWh in July 2024.
Electricity consumers in Band B get 16 hours of electricity supply daily, Band C consumers get 12 hours of electricity supply, Band D get eight hours, while Band E customers get only four hours of electricity per day.
High production costs threaten competitiveness of made-in-Nigeria goods, says MAN
Meanwhile, TheRadar earlier reported that the Manufacturers Association of Nigeria (MAN) sounded an alarm over Nigeria’s steep production costs, calling it the biggest barrier to the competitiveness of locally-made products.
MAN’s Director-General, Segun Ajayi-Kadir, said Nigerian goods meet international standards, but the hostile operating environment is driving our costs up, making it tough for local manufacturers to rival imported products.
