New NBS report shows how much households spend on electricity, gas, charcoal

• The NBS says households in Nigeria spend an average of N4,155.8 monthly on electricity
• While 19.4 per cent make of use gas for cooking 22.0 per cent use charcoal
• The high cost of electricity and cooking gas has driven many households to seek cheaper cooking alternatives

The National Bureau of Statistics (NBS) says 85.2 per cent of electricity consumers in Nigeria use an estimated billing system, while 14.8 per cent of the total households connected to the national grid use a prepaid billing system.

The bureau also stated that 86.6 per cent of households had an electricity supply and over 58 percent are connected to the national grid.

On a monthly basis, the NBS said households spend an average of N4,155.8 on electricity.

This is contained in the 2024 Nigeria Residential Energy Demand-Side Survey (NREDSS) report conducted by the NBS, in collaboration with the Federal Ministry of Power, the Energy Commission of Nigeria (ECN), the International Energy Agency (IEA) and the European Union (EU).

The NBS said the survey aimed to assess and estimate the energy demand in the residential sector of nine states as a pilot case study for the 2024 reference period.

The Statistician-General of the Federation and Chief Executive Officer of the NBS, Prince Adeyemi Adeniran, said the survey was conducted to have a comprehensive understanding of and identify the energy consumption patterns among Nigerian households. 

Adeniran said the insights contained in the report are crucial for policymakers, operators and the general public, even as the government seeks better outcomes for the country’s energy sector.

19.4% of households use gas, 22.0% use charcoal to cook

The NBS report also stated that 19.4 per cent of households reported using liquefied petroleum gas (LPG), which indicates that about one in every five households use LPG, while their average monthly expenditure on LPG stood at N10,239.7 across the surveyed states.

It further stated that an estimated 67.8 per cent of households in Nigeria use fuelwood either for domestic, agricultural, commercial, cultural, or religious purposes.

“About 41 per cent of households reported purchasing fuelwood, closely followed by cutting/collection (39.0 per cent) and only 18.9 per cent of households used other means such as barter, gift, borrowing, etc. 

“More than half of the fuelwood cut/collected by households (55.3 per cent) were branches, stems and trees. An estimated 67.8 per cent of households used the fuelwood either for domestic, agricultural, commercial, cultural, or religious purposes” the NBS stated.

According to the survey, one in every five households (22.0 per cent) used charcoal during the reference period. It said 21.6 per cent of the households using charcoal purchased the product, while only 0.3 and 0.6 per cent acquired it through their production and other means, respectively. 

High cost of electricity, cooking gas pushing households to seek alternatives

Many Nigerian households are resorting to other means of cooking with increasing costs of electricity and cooking gas.

Since the government halted electricity subsidy payment for electricity feeders categorised as Band A in April 2024 with the subsidy at N140.7 billion, the price has skyrocketed.

As of September 2024, the monthly electricity tariff subsidy paid by the Federal Government stood at N181.63 billion, increasing from N173.88 billion in August, N163.87 billion in July and N102.30 billion in May 2024, raising concerns that another electricity tariff hike may be in the offing.

Following the subsidy removal, customers in the Band A category, who make up 15 per cent of the population of electricity customers in Nigeria and consume 40 per cent of electricity at a minimum of 20 hours of electricity daily, were made to pay N225 per kilowatt hour (kWh), a 300 per cent increase from the previous N68/kWh.

Musiliu Oseni, Vice Chairman of the Nigerian Electricity Regulatory Commission (NERC), said the decision was to ensure sustainable energy distribution and reduce subsidies for the 2024 fiscal year by N1.14 trillion in line with the Federal Government’s subsidy realignment.

He said, “With the newly approved tariffs, subsidies for the 2024 fiscal year are expected to reduce by about N1.14 trillion in furtherance of the Federal Government’s realignment of the subsidy regime.

“The Commission has established a robust monitoring framework leveraging technology to ensure that the public has visibility of the service covenant with their service providers.”

The tariff was later reduced to N206.80/kWh when the subsidy figure declined to N102.30 billion in May following public outcry from customers, labour unions and manufacturers.

However, when the subsidy figure increased to N158 billion in June, the tariff for Band A customers increased by N2.70/kWh to N209.50/kWh in July.

The DisCos said the adjustment was necessitated by several key economic indices, including fluctuations in the exchange rate, the current inflation rate, available generation capacity and the cost of gas.

Also, the soaring cost of cooking gas hasn’t helped matters. As of September 2024, the NBS said the average retail price for refilling a 5kg cylinder of cooking gas increased by 4.19 per cent on a month-on-month basis from N6,430.02 recorded in August 2024 to N6,699.63. On a year-on year basis, the price increased by 59.90 per cent from N4,189.96 in September 2023.

Although the government has announced a ban on cooking gas export to drive down prices and prioritise local supply, the effects are still expected to reflect in the market.

Band A customers to pay extra N2.70 as DisCos increase electricity tariff

Meanwhile, TheRadar reported that Band A customers of electricity distribution companies (DisCos) will have to pay an extra N2.70 per kilowatt-hour (kWh) following an announcement of an increase in electricity tariff.

The DisCos, which include Ibadan Electricity Distribution Company (IBEDC) Plc, Kaduna DisCo, and Port Harcourt Electricity Distribution Company (PHED), said the tariff has been adjusted from N206.80/kWh to N209.50/kWh effective July 1.