Despite citizens being so hard-pressed on incessant utility tariff hikes, the senate passed only only motion which called for a halt to electricity bills raise. The Tinubu administration went ahead with the electricty hike with a deafening silence from lawmakers
By all standards, electricity remains a basic amenity. Yet in Nigeria, it has become a luxury. Despite persistent national outrage over the rising cost of electricity, the 10th senate has entertained just one motion specifically addressing electricity tariff hikes.
This solitary legislative intervention – “Need to Halt the Proposed Increase in Electricity Tariff by Eleven Successor Electricity Distribution Companies (Discos)” – sponsored by Sen. Yunus Akintunde on July 25, 2023, stands as a sobering reminder of how underrepresented the concerns of millions of struggling Nigerians are in the corridors of power.
Yet this is not merely a story of legislative inaction. It is the story of a controversial electricity pricing regime, one that has evolved from years of deregulation, ill-targeted reforms, opaque subsidies, and a shift toward “cost-reflective tariffs” that burden the poor more than they benefit the sector.
A brief history of electricity tariff hikes
The struggle for a sustainable electricity tariff in Nigeria dates back to the early 2000s. The unbundling of the Power Holding Company of Nigeria (PHCN) and the eventual privatisation of electricity distribution companies in 2013 under the Electric Power Sector Reform Act marked a turning point. It transferred electricity distribution to 11 private DisCos, with the Nigerian Electricity Regulatory Commission (NERC) retaining control over tariffs.
Under the Multi-Year Tariff Order (MYTO), a framework introduced in 2008 and updated regularly, tariffs were expected to reflect actual costs of generation and distribution. But for years, tariffs were frozen or only slightly adjusted, largely due to public backlash and political pressure.
In many cases, the federal government bridged the gap between what consumers paid and what DisCos claimed they needed to cover costs, through subsidies.
A major inflection point came in 2020, when NERC implemented a “Service-Based Tariff” (SBT) regime that introduced different billing bands – based on the number of hours of electricity supply received.
Understanding the electricity tariff bands
Under the SBT structure, consumers are grouped into five bands:
•Band A: Those receiving electricity for 20 hours or more daily.
•Band B: 16 to 20 hours daily.
•Band C: 12 to 16 hours daily.
•Band D: 8 to 12 hours daily.
•Band E: Less than 8 hours daily.
While Band A customers pay the highest rates on the assumption they get the best service, the model has been riddled with inconsistencies. In reality, many consumers placed in higher bands report less supply than promised, with no clear accountability or grievance resolution mechanism.
The most recent tariff hike, which took effect in April 2024, pushed Band A tariffs from N68/kWh to a staggering N225/kWh which is over 240 percent increase. Though the federal government claimed this hike only affects 15 percent of consumers, it disproportionately affects businesses, urban households, and the fast disappearing middle class, fuelling inflation and crippling production costs.
More heat, less light
The cumulative impact of these hikes has been devastating:
•Inflationary pressure: Manufacturers Association of Nigeria (MAN) reports that 40 percent of production costs are now power-related.
•Job losses and factory shutdowns: Small and medium enterprises (SMEs) are particularly vulnerable. Many are reverting to diesel generators, subject to global oil price volatility.
•Social unrest: Widespread protests trailed the 2024 tariff hike, particularly in Lagos, Kano, and Port Harcourt. Some civil society groups argued that the hike is “anti-poor.”
•Energy poverty: Despite being Africa’s largest economy, Nigeria has over 92 million people without access to electricity. Many in Bands D and E are under-metered or not metered at all, forced to pay “crazy bills” under estimated billing systems.
This means these customers were being billed on estimated usage rather than actual consumption. Furthermore, the number of customers on estimated billing actually increased by 10 percent to 6.43 million in Q1 2024.
A lukewarm gesture from senate
In this dire context, it is telling that the 10th senate has passed just one motion on electricity tariff hikes. On July 25, 2023, Sen. Yunus Akintunde (APC, Oyo central) called on the federal government to halt the proposed tariff hike and asked NERC to decentralise stakeholder engagement meetings across the six geopolitical zones rather than hold them only in Abuja.
The motion passed, but its impact has been negligible. NERC went ahead with the April 2024 hike, and no follow-up legislative action was recorded.
Parliaments Reports reached out to the federal ministry of power for comments on the recent electricity tariff hikes, the effectiveness of the service-based tariff regime, and the ministry’s response to the senate resolution of July 2023.
However, as of the time of filing this report, no response was received despite multiple follow-up attempts.
Other senate motions: electricity, but not affordability
Two other motions on electricity in the 10th senate have addressed infrastructure, not affordability:
1. Sen. Ned Nwoko’s motion (March 7, 2024) on the unexplained delay in the step-down of 100MW from the Okpai Independent Power Plant. He lamented that communities in Delta north were being denied the benefits of a facility in their backyard.
2. Sen. Haruna Manu’s motion (May 22, 2024) on the vandalisation of TCN transmission lines in the North-east. His resolution urged massive federal investment in rebuilding the Jos-Gombe-Maiduguri line and requested implementation of sections 209–213 of the new Electricity Act to enhance transmission security.
While both motions touch on supply-side constraints, they do not interrogate the pricing structure that is hollowing out the economic resilience of millions.
Also, the senate, through its committee on power, held a two-day investigative hearing on May 16, 2024, with the Minister of Power, Adebayo Adelabu. The hearing focused on the need to halt the proposed increase in electricity tariffs by the eleven successor electricity distribution companies (DisCos), particularly against the backdrop of Nigeria’s worsening economic conditions.
However, the debate on the committee’s findings was abruptly suspended midway through plenary after the chairman of the senate committee on rules and business, Sen. Titus Zam (APC, Benue north-west), raised a point of order. He informed the chamber that a federal high court in Kano had issued an order on the matter, which was now sub judice.
“Available records of information are that a federal high court in Kano has issued an order about this new tariff and the matter is pending in court. So I will urge the senate to avoid any further debate on it,” he said.
His motion was seconded by Sen. Jimoh Ibrahim (APC, Ondo south). Presiding over the session, Deputy Senate President Barau Jibrin upheld the position, directing that the debate be stepped down pending legal advice.
Despite all these and the public outcry from citizens, no tangible action has followed. The senate has neither revisited the matter nor passed any binding resolution compelling NERC or the federal ministry of power to review or reverse the hike. For millions of Nigerians, the silence has been deafening, the hardship worsening, and the hope of affordable electricity increasingly distant.
LEGISLATIVE COMPLIANCE INDEX (LCI): This is a governance accountability tool designed by OrderPaper Nigeria to assess the responsiveness or otherwise of public and private sector stakeholders, including MDAS, to legislative summons and resolutions stemming from both Houses of the National Assembly.
