The Chief Executive Officer of the Association of Nigerian Electricity Distributors (ANED), Sunday Oduntan, has described electricity subsidy in Nigeria as an unsustainable policy that fuels corruption.
Speaking on Channels Television’s Business Morning on Tuesday, Oduntan said while subsidies are intended to bridge the gap between cost-reflective tariffs and government-regulated electricity rates, the current system was inefficient, unsustainable, and vulnerable to corruption.
These shortfalls, he argued, contributed to inefficiencies across the power value chain, affecting not only distribution companies but also the generation and transmission sectors.
“If generation companies produce enough and transmission companies are capable of transmitting everything given to them, things would be seamless. Subsidy keeps going up, and it’s not sustainable or efficient. In fact, it fuels corruption.
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“We need to understand what the government is trying to do with Band A and the essence of 24/7 electricity,” Oduntan said.
He questioned whether the government could consistently bear the financial burden of subsidies, noting that failure to make timely payments led to persistent shortfalls in the system.
Oduntan, therefore, called for a system that can identify the needy and give subsidies to those who really need help, which he said was targeted rather than a general subsidy model.
Source: Channels TV
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