The Association of Nigerian Electricity Distributors (ANED) has urged stronger coordination among key stakeholders in the power sector, including the Ministry of Power, state electricity regulators, and the Nigerian Electricity Regulatory Commission (NERC), to avoid market distortions and ensure a financially sustainable industry.
Managing Director of ANED, Mr. Sunday Oduntan, made the call in a statement issued on Thursday in Abuja, following the recent decision by the Enugu Electricity Regulatory Commission (EERC) to slash tariffs for Band A customers from N209.5/kWh to N160/kWh without adequate consultation with other stakeholders.
He warned that such unilateral decisions could create policy inconsistencies, confuse consumers, and endanger the financial viability of the power market.
“To sustain investments and improve service delivery, we need a transparent and fully funded subsidy framework,” Oduntan said. “Subsidy payments must be disbursed promptly to enable DisCos settle market invoices and maintain liquidity.”
He noted that although affordability remains a shared goal, it must not come at the expense of market stability. Following the tariff cut in Enugu, electricity distributors in other states have come under pressure from customers demanding similar reductions, with some even refusing to pay their bills.
Oduntan acknowledged that the current cost-reflective tariffs are shaped by the country’s economic realities and urged customers to understand the necessity of maintaining balance in the system.
“We are not opposed to subsidies,” he said. “But they must be structured, targeted, and backed by clear funding commitments. Delayed or unfunded subsidies deepen the liquidity crisis and erode investor confidence.”
He referenced recent comments by the Minister of Power, Mr. Bayo Adelabu, who said states that implement tariff cuts must be ready to bear the financial implications through their own subsidy arrangements.
According to Oduntan, outstanding subsidy obligations of nearly N5 trillion have placed severe operational burdens on generation companies and gas suppliers. He added that Nigeria’s power market remains centrally coordinated, particularly in areas like bulk energy procurement, transmission, and settlements through the Nigerian Bulk Electricity Trading Company (NBET).
While acknowledging new regulations that permit states to operate their own electricity markets, Oduntan warned that uncoordinated state-level interventions could lead to widespread financial shortfalls and disrupt the remittance flow to upstream service providers.
He stressed that most states are also constrained by limited budgets and rising governance costs, making it difficult to sustain long-term subsidies without federal alignment.
“This underscores the need for collaboration and a market-driven approach on all tariff-related matters,” he said. “The association remains committed to building a financially sustainable and customer-responsive electricity sector.”
