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Poor Nigerians, others to get tariff relief with the Electricity Act

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The new Chairman of the Nigerian Electricity Regulatory Commission, Abdullahi Ramat, has revealed that schools, hospitals and low-income Nigerians will benefit from a tariff relief package under the Electricity Act 2023.

This was as he made known his determination to implement the Power Consumer Assistance Fund as enshrined in the Electricity Act.

Ramat disclosed this in Kano when he received the Chief Medical Director of the Aminu Kano Teaching Hospital, Prof. Abdurrahman Sheshe, and the hospital’s management team on a congratulatory visit to his residence.

He explained that the Commission is set to roll out the Power Consumer Assistance Fund, which is designed to cushion the impact of rising electricity tariffs on vulnerable consumers and critical institutions.

PCAF is a special support fund created by law to help poor and vulnerable Nigerians pay for electricity.

The fund will also help critical institutions like schools and hospitals by cushioning the impact of high tariffs.

The fund, which will be managed by NERC, will come from the Federal Government through the National Assembly budget, while some categories of electricity users, especially bigger or richer customers, will also contribute a small amount.

NERC will be in charge of managing, keeping records, and deciding how the money is shared.

Section 122(1) of the Act states that “There is established the Power Consumer Assistance Fund (in this Act referred to as ‘PCAF’) to be used for the purposes specified.” Subsection (4) further clarifies that “The PCAF shall be used to subsidise underprivileged power consumers as specified by the Minister in consultation with the Commission.”

The law empowers NERC to determine who contributes to the fund and how much. Section 123(1) provides that “The Commission shall determine the contribution rates to be sent by designated consumers and classes of consumers and eligible customers to the PCAF and the subsidies to be disbursed from the PCAF, in accordance with policy directions issued by the Minister.”

Under Section 124, all consumers, including large “eligible customers”, will make contributions at rates fixed by NERC. While regular consumers will pay through their distribution companies, industries and other eligible customers will remit directly to the commission.

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The Act comes with teeth. Section 126 warns that “Any person who fails to pay to the Commission or a distribution licensee, within the prescribed time, any amount owed under this Part, commits an offence and is liable to a fine not exceeding three times the amount owed.”

The new NERC boss, who is still awaiting National Assembly’s approval as of the time of filing this report, posted on his X handle that the PCAF would be rolled out.

“I received Prof. Abdurrahman Sheshe, the CMD, and the entire management of Aminu Kano Teaching Hospital on a congratulatory visit in my house here in Kano. We discussed how to ensure steady and affordable power for the hospital.

“I explained NERC’s plan to roll out the PCAF (Power Consumer Assistance Fund) under the Electricity Act 2023, which will cushion tariff impacts for schools, hospitals, and low-income consumers,” he stated.

The PUNCH reports that the previous plan to roll out the PCAF did not succeed.

While urging the hospital management to embrace cost-saving measures through energy audits, phasing out inefficient equipment and metering staff quarters and shops, Ramat said the commission would continue to engage the Kano Electricity Distribution Company to resolve disputes swiftly and ensure reliable supply.

“Our duty remains clear: to protect the rights of consumers while maintaining investor confidence by fostering an efficient, transparent market structure and investor-friendly ecosystem,” Ramat said.

He noted that the initiative aligns with government efforts to balance affordability with sustainability in the nation’s electricity market.

The Minister of Power, Adebayo Adelabu, promised in 2024 that the Federal Government would subsidise electricity in hospitals and universities by 50 per cent, but that has yet to materialise. Though Adelabu did not specify if this would be under the PCAF.

In his analysis, an expert in the sector, Adetayo Adegbemle, said he had been the lone voice promoting PCAR, stating that Ramat has chosen to do the right thing.

The convener of PowerUpNigeria, Adegbemle, maintained that as the sector teeters on the brink of liquidity crises, the Power Consumer Assistance Fund emerges as a critical solution, offering a structured alternative to subsidies while addressing the needs of diverse customer segments.

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According to him, the government’s subsidies that freeze end-user tariffs below cost created a wide gap between cost-reflective tariffs and the rates charged to consumers, resulting in a massive monthly subsidy burden of approximately N262bn, as only 9.5 per cent of GenCos’ invoices were settled from the market, leading to cash flow shortages that caused gas suppliers to curtail supplies.

He added that NERC’s intervention in April 2024 brought temporary relief by unfreezing tariffs for Band A customers. However, resistance to further tariff adjustments and the government’s reluctance to revise rates for lower bands have stalled progress.

Adegbemle stressed that the PCAF offers a transformative approach to resolving NESI’s liquidity challenges.

“Unlike traditional subsidies, which blanket the entire sector, PCAF is designed to provide targeted financial support to electricity consumers while allowing the DisCos to charge cost-reflective tariffs.

“The fund will be financed through contributions from the government and eligible customers, with rates and durations determined by the Nigerian Electricity Regulatory Commission. NERC will oversee PCAF, ensuring transparent management and equitable distribution of benefits.

“Initially, all customers will receive support through PCAF, reducing the financial burden during macroeconomic volatility. As economic conditions stabilise, the fund will prioritise underprivileged customers, aligning with Section 122(4) of the Electricity Act,” he stated.

He suggested that PCAF should provide a minimum monthly subsidy of N5,000 per customer, equivalent to 25 kWh of electricity, saying low-income consumers using less than 25 kWh monthly will effectively enjoy a full subsidy, ensure affordability while promote efficient energy use.

“By enabling DisCos to charge cost-reflective tariffs, PCAF ensures they can cover operational costs and meet their financial obligations to GenCos. This eliminates the persistent cash flow issues that have plagued NESI, fostering a more resilient supply chain.

“Unlike blanket subsidies, PCAF focuses on delivering support where it is needed most. Low-income households, which typically consume minimal electricity, will benefit from full subsidies, ensuring they are not excluded from access to power,” he stated.

Adegbemle added that the scheme ought to have been implemented since the first quarter of 2025.

Other experts who spoke with The PUNCH expressed optimism over the scheme, stating, however, that accountability and identifying the poor consumers are important factors.

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Earlier, Ramat, whose plan is to digitise the power sector, alluded to the fact that the challenges in the sector are enormous, as nearly 50 per cent of generated power is lost, leaving efficiency at barely half capacity.

This, he said, has discouraged investors and fuelled today’s liquidity crisis, despite 20 years of the reform and 12 years of the privatisation, while other privatised sectors like telecom thrive with liquidity and competition.

“The sector’s mixed ownership (private and government) makes digitisation fragmented; no single entity can compel another. But NERC, as the apex regulator, has the mandate to drive full digitisation across the value chain. By deploying IT, we can optimise operations, streamline processes, integrate payment and monitoring systems, stabilise the grid, enforce transparency, reduce losses such as TLF and ATC&C, and boost efficiency.

“Part of my plan includes developing an app available in both Android and iOS which will integrate the APIs of DISCOs and NISO to provide NERC with real-time visibility of payment channels and system operations,” he said in a post.

He promised to deploy a whistleblowing tool so that consumers can anonymously report electricity theft, meter bypass, and illegal connections.

“We will partner with the EFCC, borrowing a leaf from the successful naira mutilation campaign, to enforce arrests, apply name-and-shame measures, and carry out prosecutions, with penalties of up to three years’ imprisonment, as provided by section 208 of the Electricity Act 2023. This approach will not only curb electricity theft but also help reduce tariffs, since part of these losses are factored into consumer bills through MYTO.

“Honest customers should not continue paying for the crimes of electricity thieves. Ending electricity theft and vandalism is a journey we must all travel together.

“I firmly believe that with digitisation, we can tackle the sector’s challenges head-on: reducing losses, boosting efficiency, restoring investor confidence, protecting consumers, attracting competition, increasing liquidity, and ultimately lowering tariffs. This is not theory, it is achievable. And as Chairman/CEO of NERC, it is a promise,” Ramat said.

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FG allays fears over tax reforms

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The Federal Government says the newly enacted tax reforms were crafted to ease the burden on Nigerians, not worsen it, insisting that widespread misinformation is fueling needless fear and anger across the country.

Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, made the clarification during a courtesy visit to the National Orientation Agency in Abuja on Friday.

Oyedele said the purpose of the visit was to seek NOA’s support in educating citizens about the tax policies, noting that misinformation threatened to derail a reform package he described as “the most consequential and beneficial” of his career.

“You can say subsidy removal came with some amount of pain and sacrifice. Naira floatation also means people have to pay more… But this tax reform is coming with benefits. “Exemption for small businesses, exemption for workers, low-income earners, middle class; reduce their taxes, big companies reduce their taxes, harmonise taxes,” he said.

The tax reform laws were signed by President Bola Tinubu in October 2024 as part of a sweeping overhaul aimed at simplifying Nigeria’s complex tax system.

With implementation set to begin on January 1, 2026, the reforms introduce exemptions for small businesses, reduced tax burdens for workers and the middle class, lower corporate taxes, and harmonisation of multiple taxes across federal, state and local governments.

They also streamline compliance procedures and eliminate nuisance taxes to boost investment.

Oyedele explained that the committee had compiled “50 tax exemptions and reliefs” that would benefit Nigerians but lamented that many citizens, misled by online falsehoods, believed the reforms would impose new burdens.

“Sadly, as good as the reform is, if you go on the streets and ask people about the tax reform, there are people who say they can’t wait to protest on the 1st of January.

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“Unfortunately, in our environment, if you have good news, it doesn’t go viral… but misinformation goes viral very quickly.”

He cited a false rumour circulating among farmers in the North that the government planned to seize one out of every four baskets of produce, describing it as a deliberate distortion.

He added that misinformation had also taken ethnic and religious dimensions, stressing the need for NOA’s involvement in communicating the reform’s benefits in local languages and through relatable characters—farmers, students and CEOs—so that “people do not translate this good intention of the government… into a chaotic situation.”

Responding, NOA Director-General Lanre Issa-Onilu described the reforms as “the first comprehensive, far-reaching response in the fiscal and tax space we have seen,” noting that the agency fully understood its responsibility.

“I must understand beyond the level of an average Nigerian to communicate to them. We’ve done a lot of publications, but as you understand more, you realise there is a lot more to say.”

He pledged the deployment of NOA’s extensive nationwide network to disseminate accurate information about the reforms.

Issa-Onilu noted that the agency works with nearly 200 radio stations broadcasting in 72 local languages, 36 television channels, and maintains partnerships with major networks including NTA, Channels, AIT, TVC, Arise and News Central.

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Google pledges N3bn to boost Nigeria’s AI capacity

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Google, via its charitable arm Google.org, on Friday pledged N3bn to Nigeria to accelerate the nation’s digital transformation, directing funds toward artificial-intelligence training and measures to make its booming online environment safer.

The initiative, announced at a press conference in Lagos, is built around a two-pronged strategy and will funnel resources through five local organisations with significant track records in human development. These organisations include the FATE Foundation, the African Institute for Mathematical Sciences, the African Technology Forum, Junior Achievement Africa, and the CyberSafe Foundation.

One strand focuses on cultivating advanced AI talent; the other on strengthening digital security. Together, the search engine giant aims to equip Nigeria with both a skilled workforce and a more resilient digital ecosystem, addressing the twin challenges of talent shortages and cyber vulnerability that threaten the country’s ambitious digital agenda.

The Minister of Communications, Innovation & Digital Economy, Bosun Tijani, commented, “Artificial Intelligence sits at the heart of Nigeria’s desire to raise the level of productivity in our economy as well as our ambition to compete globally in technology and innovation.

“I welcome this important and timely investment from Google and Google.org, which reflects the power of meaningful private-sector partnership in nurturing our talent, strengthening our digital infrastructure, and advancing our national AI priorities. This collaboration directly supports our drive to operationalise our National AI Strategy and to position Nigerian innovators at the forefront of the global AI revolution,” he stated.

To develop AI expertise, FATE Foundation, in collaboration with the African Institute for Mathematical Sciences, will integrate advanced AI curricula into universities, equipping students and lecturers with cutting-edge knowledge. Meanwhile, the African Technology Forum will launch an innovation challenge designed to guide developers from learning to creating practical, real-world AI solutions.

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The Executive Director of FATE Foundation, Adenike Adeyemi, said, “We are incredibly proud to partner with the African Institute of Management Sciences on the Advanced AI Upskilling Project, with support from Google.org.

“This groundbreaking initiative is a direct response to the urgent need for deep AI competencies in Africa, empowering tertiary institutions, lecturers, and students in Nigeria, Ghana, Kenya, and South Africa.

“This strategic support aligns perfectly with FATE Foundation’s mission to foster innovation and sustainable economic growth across the continent, ensuring Africa is fully equipped to lead in the global technological future,” the executive told a press conference.

On the digital safety front, Junior Achievement Africa will expand its Be Internet Awesome curriculum to reach more youths, teaching them safe online practices. The CyberSafe Foundation will focus on improving the cybersecurity posture of public institutions, helping them protect sensitive data and digital infrastructure from cyber threats.

The initiative aligns with Nigeria’s National AI Strategy and the government’s goal of creating one million digital jobs. According to research by Public First, the country is projected to unlock $15bn in economic value from AI by 2030, making the development of both skills and digital safety critical for sustainable growth.

The Director for West Africa at Google, Olumide Balogun, said, “Google has been a foundational partner in Nigeria’s digital journey, and this N3bn commitment is the next chapter in that story.

“This is an investment in people, aimed at empowering them with advanced AI skills and ensuring a safe digital space to operate. We are honoured to continue our collaboration in support of the ministry’s efforts to help build a future where the promise of AI creates opportunity for everyone.”

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This announcement builds on Google’s long-standing commitment to Nigeria, including infrastructure investments such as the Equiano subsea cable and successful initiatives like the 2023 Skills Sprint programme, a N1.2bn commitment to Mind the Gap.

The programme trained 20,991 participants, including 5,217 women in AI and tech, and enabled 3,576 participants to move into jobs, internships, or businesses, demonstrating tangible progress in advancing Nigeria’s digital economy.

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Health minister, manufacturers clash over sugary drink levy

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A heated debate erupted at the Senate on Thursday as lawmakers, federal ministries, and industry groups clashed over a proposal to sharply increase excise duties on carbonated sugar-sweetened beverages.

The confrontation unfolded during a public hearing convened by the Senate Committees on Finance and Customs to consider a bill that would levy a percentage-based tax per litre of SSBs.

Lawmakers argued that raising the existing N10/litre tax is necessary to discourage excessive sugar consumption and boost funding for public health initiatives.

The session, chaired by Senator Sani Musa (Niger East), highlighted deep divisions among stakeholders.

While health advocates and medical associations backed the measure, industry players pushed back vigorously.

The Coordinating Minister of Health and Social Welfare, Prof. Muhammad Pate, threw his ministry’s weight behind the bill, describing it as a critical step toward safeguarding the country’s future health financing.

“We commend the Senate for proposing a bill that increases the excise tax on sugar-sweetened beverages and earmarks part of the revenue for health promotion,” Pate said. “This demonstrates political will, aligns fiscal policy with public health goals, and provides sustainable financing for prevention programmes—essential steps toward achieving universal health coverage.”

Pate urged the Senate to go further by increasing the SSB tax from N10 per litre to at least 20 per cent of the retail price, in line with World Health Organisation guidance.

He also recommended that at least 40 per cent of the revenue be reinvested into programmes targeting diet-related illnesses, including diabetes and hypertension.

“Failure to act now will saddle Nigeria with an overwhelming disease burden in the next 10 to 20 years,” Pate warned. “Prevention is far more cost-effective than cure.”

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Health-sector groups, including the Nigeria Cancer Society and the Diabetes Association of Nigeria, voiced strong support for the bill.

But several economic stakeholders opposed the proposal.

The Manufacturers Association of Nigeria, the Ministry of Finance, and the Nigeria Employers Consultative Association cautioned that a higher tax could have unintended consequences.

Adeyemi Folorunsho, a director representing MAN, argued that the proposed hike could trigger job losses and disrupt growth in the beverage industry. He also challenged the assumption that SSB consumption is a major driver of diabetes and obesity in Nigeria.

“Contrary to popular belief, Nigeria has one of the lowest sugar consumption rates in the world—8.3 million kilogrammes compared with the 22.1 million kilogrammes expected,” Folorunsho said. He called on the Senate to adopt a “win-win approach” in shaping the legislation.

In his closing remarks, Senator Musa assured participants that the final law would balance public health goals with economic realities.

“The committees will carefully weigh all submissions before presenting a harmonised draft to the Senate,” he said. “Legislation presented to Nigerians will be fair, transparent, and people-oriented.”

Nigeria introduced the N10-per-litre SSB tax in 2022 to curb rising rates of obesity, diabetes, and other non-communicable diseases.

However, health experts argue that the levy is far below global standards and has had minimal impact on consumption.

Manufacturers, meanwhile, warn that the industry is still recovering from inflation, foreign exchange pressures, and declining consumer purchasing power.

They caution that higher taxes could lead to plant closures, job cuts, and lower government revenue.

The Senate’s push to amend the law has reignited a long-running clash between public health advocates and economic stakeholders.

See also  States to earn over N4tn yearly from VAT reforms

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