Credit: REUTERS/AKINTUNDE AKINLEYEABUJA, Jan 5 (Reuters) - Nigeria's electricity regulator has increased prices for top-band customers to reflect the impact of inflation and a weakening naira, the regulator said on Tuesday.
Prices for customers in bands A, B and C - commercial and high-use residential users - will rise by 2 naira to 4 naira per kilowatt hour, the Nigerian Electricity Regulator Commission said in a statement. The baseline rate, raised late last year, varies by customer but is around 24 naira per kilowatt hour.
Artificially low tariffs have made it difficult to attract investment into the troubled sector, which is beset by problems at all levels - from generators to distribution companies - and provides limited and unreliable power supply.
Tariffs for customers getting less than an average of 12 hours of electricity per day, bands D and E, were "frozen and subsidised" in line with government policy, the statement said.
Groups such as the World Bank have long pressed Nigeria to make state-controlled electricity prices cost reflective.
Efforts to increase tariffs last year were temporarily delayed due to strike threats from labour unions.
Joachim MacEbong a senior analyst with SBM Intelligence, said the government knows it must increase the tariffs, and is trying to shield poorer Nigerians from higher prices they can ill-afford. But increases segregated by band could prove complicated for distribution companies, known as DISCOS, which do not necessarily know which customers fall into each band.
"It will be a very uneven, complicated process for DISCOS to collect some of these revenues," MacEbong said.
(Reporting By Camillus Eboh, Felix Onuah and Chijioke Ohuocha. Writing and additional reporting by Libby George; editing by David Evans)
((Libby.George@thomsonreuters.com; +234 809 065 5059 ; Reuters Messaging: libby.george@thomsonreuters.com))
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