NISO Calls For Cautious Move Toward Fair Electricity Pricing

The Nigerian Independent System Operator (NISO) has called for a gradual and well-managed transition to cost-reflective electricity tariffs across the country, stressing that pricing reforms must balance affordability with service quality to build public trust.

Speaking at the 5th Annual Power Correspondents Association of Nigeria (PCAN) Conference in Abuja on Thursday, NISO Managing Director, Engr. Abdu Bello Mohammed, said tariff adjustments should be deliberate and tied to visible improvements in power supply. He noted that a successful transition depends on protecting vulnerable Nigerians from energy poverty while ensuring the sustainability of the electricity market.

Delivering his keynote address titled Cost Reflective Tariff vs. Energy Poverty: Finding a Pricing Balance in the Nigerian Power Sector, Mohammed described electricity tariffs as the foundation of the industry’s financial health. He explained that the persistent liquidity challenges, low investment levels, and weak service delivery in the Nigerian Electricity Supply Industry (NESI) stem largely from tariffs that fail to cover the actual cost of operations.

He stated that the debate should not be about whether cost-reflective tariffs are necessary but about how they can be achieved without worsening hardship for citizens. According to him, achieving fair pricing requires well-targeted interventions such as lifeline tariffs and data-driven rebates for low-income households instead of general subsidies that distort the market.

Representing NISO board member and Mainstream Energy Managing Director, Mr. Lamu Audu, Mohammed added that reducing technical, commercial, and collection losses would ease the financial strain on consumers. He explained that improving metering systems, automation, and data accuracy could directly lower overall costs.

The NISO chief also stressed that transparency and accountability are crucial to restoring investor confidence. He said the agency is modernising grid operations through digital platforms, Supervisory Control and Data Acquisition (SCADA), and Energy Management Systems (EMS) to enhance reliability and market coordination.

He noted that tariff reform and market efficiency must progress together, as a transparent, data-driven electricity market helps close revenue gaps and support realistic pricing. Mohammed also called for broader policy alignment in areas like gas pricing reform, energy efficiency, and data governance to reduce generation costs and improve affordability.

Reaffirming NISO’s commitment to a fair and reliable energy system, Mohammed said the agency’s goal is to build a sustainable power sector that attracts investment, delivers dependable supply, and ensures that no Nigerian is left without electricity due to inability to pay.