The Lagos State Commissioner for Energy and Mineral Resources, Biodun Ogunleye. Photo: The Electricity Hub Electricity distribution companies have faulted the Lagos State Government’s proposed plan to phase out electricity customer band classification, warning that the move could trigger consumer unrest, worsen market distortions, and lead to blackouts if implemented prematurely.
Officials of the power firms, who spoke anonymously with The PUNCH due to the sensitivity of the matter, said the intention of the Lagos State Government was commendable but argued that the state must first guarantee a stable electricity supply across all areas before abolishing the banding structure introduced by the Nigerian Electricity Regulatory Commission in 2024.
The criticism follows comments by the Lagos State Commissioner for Energy and Mineral Resources, Biodun Ogunleye, who said at a ministerial press briefing in Alausa, Ikeja, on Monday that the state was working towards eliminating electricity band classification and ensuring stable power supply for all residents.
Under the NERC framework introduced in April 2024, electricity consumers were categorised into Bands A to E based on the number of hours of electricity supplied daily. Band A customers, who enjoy a minimum of 20 hours of electricity supply, pay cost-reflective tariffs, while customers in lower bands continue to enjoy government subsidies with fewer hours of supply.
However, the DisCos argued that removing the classification without first improving electricity generation and supply across the state would create serious challenges, especially when many customers are not metered. “Their intention is very good. It is a laudable intention.
But there’s a difference between good intentions and practicability. We have to always think about what is practicable and what is not practicable. A lot of people play to the gallery as far as power is concerned in Nigeria. Talk is cheap,” one of the operators said.
He acknowledged Lagos State’s capacity and governance structure but stressed that eliminating estimated billing and implementing uniform cost-reflective tariffs would require huge financial commitments. “The Lagos State Government is still the best in Nigeria. No state is as good as Lagos in terms of data, in terms of performance, and in terms of practice.
The Lagos State Government is better than any other government. So, as a result of that, one can say that Lagos State can do whatever it promises to do. “But we have to be realistic. To stop estimated billing, you must meter everybody, and to meter all unmetered customers, you have to pay N180,000 multiplied by the number of electricity customers in Lagos.
That’s the money you have to raise to meter them. You can calculate it. There’s a cost element to metering,” he added. The operators warned that abolishing band classification while introducing full cost-reflective tariffs could provoke resistance from consumers in underserved communities currently paying subsidised tariffs.
“Eliminating band classification will cause crises. Lagos may not understand it now. Let me make it practical for you: some people live in areas with a stable power supply, while some are in underserved areas where they may not have a power supply for days or weeks.