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Business Hike in Electricity Tariff: Nigerian Power Producers Not Paying Increased Gas Price



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It has been revealed that power plants in Nigeria are yet to start paying more for the gas they use to produce electricity. The expected increase in gas price was expected to lead to a hike in electricity tariff in the country. Excerpt from ThisDay:

Contrary to the concern being raised that the recent increase in the price of domestic gas from $1.5 per thousand cubic feet (mcf) to $2.5 per mcf would lead to immediate hike in electricity tariff, investigation has revealed that the electricity generation companies have not started paying the new price.

In what it described as a “pragmatic and creative” short term approach to address the issue of inadequate gas supply to thermal generation plants across the country, the federal government, through the Nigerian Electricity Regulatory Commission (NERC) had approved a new gas-to-power pricing benchmark of $2.50/mcf and $0.80/mcf as transportation costs for new capacity.

The benchmark, according to the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, would equally increase with the United States annual inflation statistics.

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