EERC Clarifies New Electricity Tariff in Enugu: Band A Reduced to ₦160/kWh Without Tampering With Generation Costs

EERC Stands Firm on Electricity Tariff Reduction in Enugu: “We Didn’t Tamper With Generation Costs”

In the wake of the recent decision by the Enugu State Electricity Regulatory Commission (EERC) to reduce the electricity tariff for Band A customers from ₦209/kWh to ₦160/kWh, tensions have emerged within the Nigerian power sector. Several stakeholders, particularly from the Generation Companies (GenCos), have voiced their concerns about the implications of this decision, fearing it could destabilize the sector or suggest regulatory overreach.
However, the EERC has come forward to clarify its position, asserting unequivocally that the revised tariff does not compromise the existing generation and transmission cost structures in any way. According to the Commission, the new pricing framework was developed with transparency, sustainability, and fairness in mind, specifically tailored to the unique needs and economic realities of Enugu State residents.

Effective August 1, 2025, customers on Band A in Enugu State, classified as those receiving a minimum of 20 hours of power supply daily, will now be billed at ₦160 per kilowatt-hour, a significant drop from the previous ₦209/kWh. The new tariff order also froze the electricity tariffs for Bands B to E, ensuring that no customer band outside Band A will experience any increase for now.
This move, which many observers have called bold and unprecedented in Nigeria's subnational power regulation history, came after MainPower Electricity Distribution Limited, a subsidiary of the Enugu Electricity Distribution Company (EEDC), submitted its tariff review request to the EERC. The Commission carried out extensive consultations and data analysis before finalizing the order.

In a detailed statement signed by Barr. Reuben Okoye, the Commissioner for Electricity Market Operations at EERC, the agency reiterated that the cost of electricity generation and transmission from the national grid remains intact and was fully factored into the new pricing structure.

“We did not tamper with that cost at all in our tariff determination. Instead, we adopted the prevailing national cost in full. Our focus was on ensuring that MainPower recovers all its efficient costs and earns a reasonable return for the services it provides to electricity consumers in Enugu State,” said Okoye.

This statement is particularly significant given that electricity generation costs, usually borne by the GenCos, form the bulk of the final consumer tariffs. By clearly stating that it maintained these costs, EERC aims to dispel the notion that its decision jeopardizes the financial sustainability of upstream power sector operators.

According to EERC, the new tariff reflects accurate and verifiable data submitted by MainPower and validated by the Commission. The analysis showed that maintaining the Band A tariff at ₦209/kWh would amount to overcharging consumers in the state, a practice that the Commission is determined to eliminate.

“After reviewing all submitted data, and revalidating our computations, there was no rational basis to retain the old tariff. Our review methodology ensured complete cost recovery for MainPower, including its NBET invoices and even its share of historical debts tied to the CBN’s interventions in the Nigerian Electricity Supply Industry (NESI),” EERC noted.

The EERC emphasized its vision to create a sub-national electricity market in Enugu State that is not only transparent and accountable but also reliable and sustainable. This vision, the Commission insists, is being built on rigorous policy reviews, data accuracy, and a firm commitment to consumer welfare.

“We inherited the existing tariff regime but are fully committed to developing a better system. Our mission is to serve the people of Enugu State through improved regulation, oversight, and stakeholder collaboration,” Okoye explained.

This underscores EERC’s proactive stance in aligning its activities with the Electricity Act 2023, which devolves regulatory power to states for managing electricity within their borders.

EERC responded to allegations that the tariff cut could lead to revenue shortfalls for Generation Companies, asserting that GenCos cannot expect over-recovery from a single state's tariff order when cost-reflective pricing has yet to be implemented nationwide.

“The fact remains that GenCos will not benefit from excessive collections in a state where a cost-reflective tariff has not been adopted across the board. Their present concerns are misdirected,” the Commission clarified.

Still, the agency maintained that it remains open to further discussions and willing to receive evidence that could challenge the validity of its tariff framework.

“We invite anyone with data to counter our computations to come forward. We will provide clarifications and explain every component of our methodology. Our doors are open,” Okoye stated.

It is important to note that the EERC’s tariff order applies solely to Enugu State and is based entirely on the unique operational and economic conditions of the state’s power sector. This is in line with the Electricity Act, which empowers state governments to regulate electricity within their territory independently.

“This tariff is only applicable to Enugu State, after careful consideration of local data, customer capacity, and MainPower’s operational structure,” EERC emphasized.

This clarification aims to eliminate any confusion that the new pricing structure might affect electricity tariffs in other parts of Nigeria.
The downward revision of the Band A tariff offers much-needed relief to high-consumption electricity users in the state, especially businesses, hospitals, educational institutions, and manufacturing concerns that depend on a steady power supply. For these customers, the change translates to a monthly reduction in energy costs, which could improve profitability and encourage investment.

EERC also hinted at ongoing efforts to migrate more customers into Band A, a move expected to spread the cost of electricity supply over a larger customer base. This could eventually lower the average cost of service delivery and promote system efficiency.
As part of its broader vision for energy self-sufficiency, EERC extended an invitation to generation companies willing to operate on commercial terms to consider establishing power generation facilities in Enugu State.

“We welcome any GenCo willing to operate under a willing-buyer, willing-seller model. We will assess and approve their Power Purchase Agreements (PPA) and include the costs in tariff structures as pass-throughs,” said the Commission.

This approach offers investment opportunities in the state’s electricity value chain while boosting local energy production capacity.
Enugu Electricity Consumers Get Relief as EERC Slashes Band A Tariff from ₦209 to ₦160/kWh—New Electricity Tariff Begins August 1, 2025
Despite the backlash from some quarters, the Enugu State Electricity Regulatory Commission is standing by its decision to revise Band A tariffs, describing it as just, fair, and economically justifiable.
By anchoring its policies on transparency, accurate data analysis, and customer protection, the Commission is showing what sub-national electricity regulation could look like under the Electricity Act 2023. Its model may soon become a reference point for other states seeking to assert control over their local electricity markets. As Nigeria's power sector evolves into a more decentralized structure, actions like EERC’s bold decision to cut tariffs will play a crucial role in shaping the future of energy pricing, consumer protection, and private sector engagement in the country.
Key Takeaways: What You Need to Know About EERC’s Tariff Review

• Band A tariff in Enugu State has been reduced from ₦209/kWh to ₦160/kWh, effective August 1, 2025.
• The new pricing does not tamper with generation or transmission costs.
• The commission insists its methodology is data-driven and ensures full cost recovery for MainPower.
• The tariff change applies only to Enugu State and not the rest of Nigeria.
• EERC remains open to stakeholder engagement and investment in local generation facilities.
  
  By PrimeLineInfo