National

Flash: More hardship looms as Nigeria set to remove subsidy on electricity

Voice Air Media, VAM News Update

Minister of Power, Adebayo Adelabu, has said that Nigeria cannot continue to subsidise electricity, adding that the country needs to start implementing a cost-effective tariff model.

This, he said, is because the country owes Generating Companies (GenCos) N1.3 trillion and gas companies $1.3billion.

Adelabu stated this in a briefing in Abuja on Wednesday.

The Minister said that only N450 billion was allocated to subsidy this year but the ministry needs over N2 trillion for subsidy.

He said State Governments will be allowed to generate power independently to supply power to their States.

He claimed the reasons behind the approximately six grid collapses that have occurred since December 2023 are the shortage of gas, aging equipment in the grid value chain, a limited ability to evacuate generated power, and the destruction of power plants in certain areas of the nation’s northeastern geopolitical zone.

According to him, the Transmission Company of Nigeria(TCN) has over 100 unfinished projects because of differences in contract figures caused by fluctuations of the forex, as a result, the company won’t issue any new contracts until all projects are completed.

The Minister added that the 2024 budget has over N50 billion set aside for the construction of small grids that will provide electricity to isolated locations.

VAM News

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