By Isah Aliyu Chiroma
This week, the power sector was in disruption. The news came, with the minister of power announcing the recent increase in electricity Tariff, which is a pilot in phasing out of electricity subsidies in the country. Going further, he said removing all subsidies in the sector will allow the thriving of investment in the power sector.
One of the fundamental necessities that people directly enjoy is electricity, which is necessary for several of their daily activities. The raise will impede several operations since it is one of the sectors that the citizens directly benefit from.
We ought to have considered strategies by now for supplying the nation with alternate energy sources. a sustainable energy source that improves human health by controlling carbon emissions. In the long term, we should have learned how to mitigate the effects of subsidy from previous steps we took.
The 240 per cent increase which is effective from April 3, 2024 will have effect on people’s lives, businesses, and the nation’s overall progress. Both consumers and businesses will bear a financial burden. Many Nigerians, particularly those from lower socioeconomic classes, will find out that their electricity costs will take up a large percentage of their income. As a result, they will have less money available for other necessities like food, healthcare, and education.
Businesses, particularly small and medium-sized enterprises (SMEs), will struggle to afford the high cost of electricity, this will hampers their ability to grow, innovate, and create employment opportunities.
Manufacturing is one of the severely electricity-dependent industries that struggle to maintain cost-effectiveness while still hitting production requirements. This will hinder their capacity to compete both nationally and abroad, which eventually affects the expansion and development of the economy of the nation.
Many communities lack access to inexpensive and dependable power, particularly those in rural areas. The lack of energy exacerbates social inequalities and makes it more difficult to accomplish sustainable development objectives.
The inefficiency and poor management of the power industry in Nigeria is one of the fundamental causes of the high cost of electricity. Inadequate infrastructure, transmission losses, and a dearth of investment in renewable energy sources are among the factors that drive up the expense of producing and distributing electricity. The volatility of power tariffs is also influenced by the reliance on fossil fuels.
There is a need to enhance accountability and transparency in the power industry, as well as policy changes. The creation of an effective and sustainable energy system, to make use of renewable energy sources and encourage energy-saving practices must be given top priority by the government. To lessen dependency on pricey fossil fuels entails enhancing infrastructure, cutting transmission losses, and diversifying the energy mix.
Regulations that uphold fair pricing practices encourage competition, and draw in private investment is also required. This will establish confidence among stakeholders and create an environment that is favorable to the growth of sustainable energy sources, which will require transparent and responsible governance in the power industry.
The hike in electricity is a serious problem that needs urgent attention and coordinated action from all parties involved. We must not only lessen the financial burden on individuals and companies, but also build an inclusive and sustainable energy system that promotes social progress, economic expansion, and environmental sustainability.
