The Federal Government disclosed a plan to commit $3 billion to the power sector in the next two years.
The spending is expected to raise the current 4,900 megawatts (MWs) to at least 7,000MWs.
This was disclosed by the Special Adviser to President Buhari on Infrastructure, Ahmad Zakari, during a virtual meeting organised by the Abuja Chamber of Commerce and Industry (ACCI).
He noted that besides the $500 million loans the government secured from the World Bank earlier this year, it is expecting another facility from the African Development Bank (AfDB), saying that the gestures are a demonstration of confidence in the reforms of President Muhammadu Buhari administration.
Zakari noted that with renewed financial discipline in the sector following the recent intervention by the Central Bank of Nigeria (CBN), electricity tariffs are expected to hit N100 billion in the short to medium-term.
He stressed that if the sector were driven by the appropriate economics, there would be enough energy for the people, as the government plans to end subsidies by the end of the year.
He stated that the Buhari administration was focused on moving from the traditional way of funding subsidies or using the liquidity in the sector to fund consumption. Rather, he said, the subsidy budget would go into infrastructure that would ultimately lead to growth.
“People say if you eliminate subsidies you are going to have poor people or the vulnerable people pay more. But we argue that the only reason the power price in Nigeria is high is that we do not generate enough.
“If you generate 10 gigawatts of power, the tariff will be half of what it is now. Keeping the prices officially low is not the approach; increasing delivery power is the approach that will effectively get the same output, which is, making the citizen pay lower.”
On his part, ACCI president, Dr. Almujaba Abubakar, urged the government to ‘work the talk’ in the area of engaging local meter manufacturers in the National Mass Metering Programme (NMMP).
“Local companies with huge investment in the fields should be genuinely supported to produce meters locally. Financing and other incentives should be administered efficiently to achieve the desired goals,” he said.