Tariff Slash Didn’t Tamper With Generation Costs – Enugu Electricity Commission

The Enugu State Electricity Regulatory Commission, (EERC), has clarified that its recent order that led to reduction of electricity tariff for Band A from N209/kWh (per kiloWatt) to N160 kwh, did not tamper with the prevailing cost of power generation in the country in any way.

It maintained that based on MainPower’s costs, there was no justification to keep the price of electricity for Band A at N209 per kWh in the state.

The commission made the clarification following concerns raised by some sections of the power sector stakeholders, including the generation companies (GenCos), to the new tariff order that was issued by the Commission to MainPower Electricity Distribution Limited, the subsidiary of EEDC for electricity distribution in the state.

The tariff order led to the reduction of the tariff for Band A customers to N160 kWh, and the freezing of the tariffs for the other bands effective from August 1, 2025.
EERC’s commissioner for Electricity Market Operations, Reuben Okoye, who made the clarification on Wednesday, maintained that although it inherited the current tariff regime, “the Commission is focused on developing a sub-national electricity market that is transparent, accountable, reliable and sustainable and therefore will review utility costs of service to achieve its mandate to the people of Enugu State.”
EERC further clarified, “The Order is for MainPower’s operation in Enugu State. It does not affect electricity services in other states, between states and across the country.
“The cost of delivering electricity from the National Grid to MainPower via EEDC has been accommodated in full. We did not tamper with that cost at all in our tariff determination, but rather adopted it.

“Our Order ensures that MainPower recovers all its efficient costs and makes reasonable returns in its business of providing electricity services to citizens of Enugu State.

“Considerations and reconsiderations of the MainPower tariff application and data still presents the same outcome that ensures full payment of invoices to all parties.”
On the justification for tariff reduction, EERC said, “Having gone through our rigorous process, EERC has no rationale or justification to keep Band A at N209 in the State.

“EERC has not removed a kobo from the generation and transmission costs of delivering power to Enugu State, but rather included the exact costs to ensure complete payment of MainPower’s portion of the Nigerian Bulk Electricity Trading (NBET)invoices. Also, MainPower’s share of EEDC’s debts arising from CBN’s interventions in the NESI were included in the tariff.

“EERC and MainPower also reviewed all the relevant data/information provided by MainPower for its tariff determination to ensure accuracy.

“We are willing to entertain any evidence that shows that our methodology, analysis, computation and output are wrong. The total focus on the reduction of Band A tariff by some commentators is rather unfair to the Commission and to electricity consumers in Enugu State.

“It is important to say that with the ongoing migration of more customers to Band A, the general cost of delivering electricity is spread across larger customer numbers, which should also result in a reduced cost of service delivery.”

Continuing, the Commission added, “The emerging issue or question is: should customers in Enugu State be over-billed for electricity services and if so, for whose benefit?

“The fact remains that GenCos will not get the over-recovery from any Subco until cost reflective tariff is adopted across board in the country. So, their present concerns are misdirected.

“We stand ready to provide clarification as well as engage concerned stakeholders so as to provide assurances regarding the Order.

“Again, for emphasis, let us be clear that this tariff Order is only applicable to Enugu State, as it was developed after considering the circumstances, information and data of MainPower in the State.

The Commission, therefore, invited GenCos that are ready to operate with effective contracts based on a willing-buyer, willing-seller commercial arrangement to consider setting up power plants in Enugu State.

“We will consider and approve your PPA and tariff for them to do their business, as the PPA cost will be a natural pass-through in the tariff,” EERC concluded.