Business

JUST IN: Manufacturers Rejects 40% Electricity Tariff Hike on Mere 4000MW

Published

3 years ago

June 23, 2023

255 Views

The Manufacturers Association of Nigeria (MAN) has rejected the planned 40 percent hike in electricity tariff, which will become effective from July 1, calling on the government to shelve the increase until electricity generation , transmission and supply improves in the country.

The Nigerian Electricity Regulatory Commission (NERC), had said that the current tariff increase is based on the Service Based Tariff, SBT, benchmarked on an exchange rate of N441/$ and inflation of 16.97 per cent.

It argued that since the value of the naira to the dollar now hovers above N700 and current rate of inflation at 22.45 percent, it is necessary to increase tariff to mitigate operators’ cost of operations.
However, MAN, in its reaction, that beyond the present embattling high prices, starting July a 40 percent hike at this time is simply outrageous.
Segun Ajayi-Kadir, the Director-General of MAN, said that the expectation of the manufacturers is that the Federal Government and the NERC will ensure improvement in electricity generation, transmission and distribution that will lead to adequate and reliable electricity supply in the country, rather than increasing the tariff on the mere 4000MW to meet all revenue needs of stakeholders in the electricity supply industry.

” Government should ensure that at least 90 percent of electricity consumers are metered to ensure consumption reflective electricity bill payment, formulate electricity policies that will aid investment in energy industry to increase generation capacities that will usher in large scale production of electricity and ensure effective implementation of the recent Electricity Act (2023) that is aimed at increasing the electricity supply in the country,” he said.

The Association urges NERC to
▪︎ Eradicate outrageous bills by closing the metering gap through the liberalization of ultimate users’ access to effective mass metering;

▪︎Ensure the connection of all consumers to the electricity grid to avoid free riding and unfair charges on the few connected consumers;

▪︎ Work on efforts to increase the electricity supply base in order to distribute the total cost among a high number of consumers at a much lower unit cost;
▪︎ States and private investors should rise up to the challenge by taking advantage of the Electricity Act 2023 to eradicate the energy poverty of their people.

Likely Effects of Tariff Hike On Manufacturing industries
As a matter of fact, a further rise in electricity tariff could lead to the following:

i. Costs of production will soar: Higher electricity tariff will directly increase the cost of production for manufacturers. Already, we have energy constituting between 28-40% in the cost structure of manufacturing industries.
You can imagine the impact on manufacturing industries that are energy-intensive such as metal processing, heavy machinery, and chemicals manufacturing.

ii. Profit margins will reduce: A spike in the electricity tariff will erode the profit margin of the manufacturers and reduce their ability to expand operations and create new jobs

iii. High probability of activities paralysis: This is a definite possibility among small and medium-sized enterprises (SMEs) who are unable to accommodate the higher price.

iv. Potential decrease in the revenue collectable by government: The hike in electricity tariff will reduce the manufacturers’ profitability and by extension the quantum of taxes and fees payable to the three tiers of Government. Manufacturers remain the largest income taxpayer in the country. Therefore, in the event of poor income generation due to high costs of production, the government purse will suffer.

v. Manufacturers will ultimately pass on the additional cost to the consumers of their products: This will increase the cost of local made products in the market and complicate the rising inflation rate in the country.

vi. Recession of manufacturing activities: An increase in electricity tariff will reduce the purchasing capability. One of the resulting effects is the fall in demand and recession of manufacturing activities over time.

vii. The sector’s competitiveness will definitely worsen: The high cost of the products will make locally produced items less competitive, when compared with imported alternatives.
This is also true of exports, as Nigeria products may find it more difficult to penetrate foreign markets. Such a move will restrict our exports earnings because it will be impossible to compete with counterparts in the global trading environment.

viii. High probability of outward investment. Some manufacturing industries may consider shifting production to other economies with lower electricity tariffs and guaranteed availability.

Related Topics:Electricity Tariff Hike Manufacturers

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President Tinubu Receives Nigeria’s Tax Ombudsman, Urges Fairness and Transparency in Tax Administration

Published

31 minutes ago

February 5, 2026

Charles Flames

1 Views

President Bola Ahmed Tinubu on Thursday received Dr. John Nwabueze, the Chief Executive Officer of the Nigerian Tax Complaints Commission—widely known as the Tax Ombudsman—at the State House in Abuja.

The meeting, attended by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, comes as part of ongoing efforts to strengthen Nigeria’s tax reform agenda and build public confidence in the revenue system.

Dr. Nwabueze was appointed by President Tinubu on November 4, 2025, as the pioneer Tax Ombudsman under the Joint Revenue Board of Nigeria (Establishment) Act, 2025.

The legislation establishes the Office of the Tax Ombud (also referred to as the Tax Complaints Commission) to serve as an independent body for investigating and resolving disputes between taxpayers and tax authorities, including complaints related to taxes, levies, customs duties, excise matters, and regulatory charges.

During the audience, President Tinubu charged Dr. Nwabueze to diligently execute his mandate with integrity, impartiality, and professionalism. The President reaffirmed the administration’s commitment to fairness, transparency, and accountability in tax administration, emphasizing that the new office is a critical tool for protecting taxpayers’ rights, reducing arbitrary actions by officials, and fostering voluntary compliance.

The establishment of the Tax Ombudsman is seen as a key pillar of President Tinubu’s broader fiscal reforms aimed at harmonizing revenue administration across federal, state, and local levels, curbing multiple taxation, and creating a more predictable and equitable business environment.

Dr. Nwabueze, a seasoned tax professional from Oshimili South Local Government Area of Delta State, brings extensive experience in tax policy, fiscal advisory, and public service. His background includes roles as Managing Partner of a tax advisory firm, Technical Adviser to National Assembly committees, and adviser to former economic teams.

The new laws empowering the Tax Complaints Commission are expected to enhance taxpayer protection, promote efficient dispute resolution through mediation rather than litigation, and ultimately boost trust in Nigeria’s revenue framework amid the country’s push for sustainable economic growth and improved revenue generation.

Business

Court jails Ex- NEXIM MD Robert Orya for N2.4bn Fraud

Robert Orya was prosecuted by the Economic and Financial Crimes Commission on 49 counts, bordering on breach of trust, fraud, misappropriation, impersonation, corruption, and abuse of office.

Published

3 hours ago

February 5, 2026

OCHEFA

5 Views

•Robert Orya

A High Court of the Federal Capital Territory in Abuja has convicted former Managing Director of the Nigerian Export-Import Bank (NEXIM), Robert Orya, and sentence him to ten years’ imprisonment for fraud involving about ₦2.4 billion.

Robert Orya was prosecuted by the Economic and Financial Crimes Commission on 49 counts, bordering on breach of trust, fraud, misappropriation, impersonation, corruption, and abuse of office.

Justice Frances Messiri delivered the judgment, on Thursday sentenced Orya to ten years on each count, with the terms to run concurrently.

The offences were traced to Orya’s tenure as NEXIM Managing Director between 2011 and 2016, during which he was found to have diverted bank funds through shell companies, including Luxurium Leisure Services Limited.

The court also found that he fraudulently induced the disbursement of loans, including ₦488 million to Treasure Mix Construction Limited, under false pretences.

Orya was first arraigned by the EFCC in November 2021.

Business

South Korea to Produce Electric Vehicles in Nigeria

The project will be implemented in phases, beginning with EV assembly and expanding into full in-house production, with an estimated capacity of 300,000 vehicles.

Published

12 hours ago

February 5, 2026

OCHEFA

12 Views

Photo: Minister of State for Industry, John Enoh, and AEDC Chairman,Yoon Suk-hun.

The Federal Government has signed an agreement with South Korea to establish an electric vehicle manufacturing plant in Nigeria.

In a document seen by Ohibaba.com, the Memorandum of Understanding (MoU) was signed by the Minister of State for Industry, John Enoh, and the Chairman of the Asia Economic Development Committee (AEDC),Yoon Suk-hun, for South Korea.

The initiative will accelerate technology transfer, investment promotion, human capital development, and research, design, and innovation.

The project will be implemented in phases, beginning with EV assembly and expanding into full in-house production, with an estimated capacity of 300,000 vehicles and the creation of approximately 10,000 jobs.

Nigeria’s automotive sector faces structural challenges, including limited local component production, high assembly costs, and heavy reliance on imports.

The country imports between 400,000 and 720,000 vehicles annually, with 74–90% being used cars.In 2023, imports reached 700,000 units, with passenger cars valued at $1.05 billion in 2024, making Nigeria one of the world’s largest markets for pre-owned vehicles.

To promote electric mobility, the federal government launched a 20 billion naira ($12 million) consumer credit program in December 2024.

The scheme supports the purchase of locally assembled electric vehicles, motorcycles, and tricycles, partnering with domestic manufacturers including Innoson, Nord, CIG (GAC), PAN, Mikano, Jets, NEV (Electric), and DAG to expand access and foster the growth of a homegrown EV industry