The Manufacturers Association of Nigeria (MAN) has called on the Federal Government to reassess the performance of electricity distribution companies (DisCos) following reports of a planned tariff hike.
MAN's Director-General, Segun Ajayi-Kadir, criticized the continuous rise in electricity costs, stressing that it is stifling the manufacturing sector and the broader economy.
He urged the government to evaluate the impact of tariff increases, scrutinize the cost-reflective tariff model, and audit DisCos' infrastructure investments.
Despite the privatization of the power sector in 2013, Ajayi-Kadir noted that expected improvements in energy supply have yet to materialize.
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He attributed this to the sector's lack of technical and financial capacity, highlighting that while Nigeria's installed capacity stands at 10,000MW, actual generation remains significantly lower.
Data from the National Bureau of Statistics showed a decline in electricity supply from 5,909.83 GWh in Q2 2023 to 5,612.52 GWh in Q2 2024, even as tariffs increased by over 230%.
MAN warned that another hike would escalate production costs, fuel inflation, and erode manufacturers' profits.
Meanwhile, the presidency clarified that current tariffs only cover 65% of supply costs, with N200bn spent monthly on subsidies. The government is now working on a targeted subsidy model to better support low-income households.
