When Bunmi Alade, a young banker, relocated to Lekki in Lagos, she was excited with the change of environment; a move that seemingly got her closer to the ‘big boys’ and connection.

But six months down the line, the excitement faded as she faced the reality, particularly the cost of living in a highbrow area, when one is still struggling.

Her N750,000 monthly salary could not carry her as the expenses keep growing more than her income, especially high rent and electricity bill, as her area is on the exclusive ‘Band A’ tariff.

Considering the growing and embarrassing financial burden, she requested for transfer to a mainland branch of her bank and subsequently resettled in an area where electricity supply attracts less tariff, as well as less supply.

The above is a reality. Sadly, Bunmi is not among the privileged 15 percent of the total electricity consumers in the country that are on Band A, an exclusive consumer segment that enjoys guaranteed 20-hour supply a day, from the 11 electricity distribution companies (Discos) across the country.

Yet, for the 15 percent, there seems to be a mixed bag in the supply as some get the promised 20 hours uninterrupted electricity supply, while others get less and still pay the high tariff.

Since April 2024, when ‘Band A’ electricity tariff was introduced, there has been a significant increase from N68 per kilowatt-hour (kWh) to N225 (kWh), representing over 200 percent increment, though slightly revised to N206 (kWh) later.

While many in the new band enjoy a considerable stability in electricity supply, blackout seems to have worsen for consumers outside the Band A.

Mutiu Oyekunle, a serial investor and hotelier, falls in the mixed bag experience as his two businesses are not optimally serviced by the Eko Electricity Distribution Company (Eko Disco), in terms of the anticipated 20-hour electricity supply.

“My house, my hotels and my wife’s school are all on the Band A tariff, but we don’t get up to 20 hours supply every day due to a notice of one fault or a technical issue. But they promised 20 hours supply for Band A consumers. We are still using generators in the hotel and you know how expensive that option is,” the hotelier said.

“I think, the government should review the privatization of the power sector or the tariffs because the handlers are offering far below our expectations. We cannot be paying more and getting less because we are businesses and we need to stay afloat.”

Reginald Osaeloka, an Opebi, Lagos-based SME operator, who is served by the Ikeja Disco, decried that the Band A tariff is not favourable for small businesses like his due to the shortfall in the 20 hours supply the disco promised and is collecting payment for.

“I packed my Mikano generator when my business neighbourhood was designated Band A. My action was informed by the thinking that with 20-hour electricity supply every day, my packaging venture will thrive and huge cost on diesel will be saved.

“But we seem to be back to the era of band-less tariff as supply fluctuates and the disco keep giving excuses and even wants review of the tariff,” Osaeloka said.

Recalling the periods the national grid collapsed, Osaeloka noted that he went back to his generators, amid costs that impacted negatively on his profit margin.

“During one of the grid collapses, my contact at the disco told me that it does not matter much because I am on pre-paid billing, but he did not count my losses for the unbudgeted money for diesel and maintenance. The sad situation is also what is increasing the cost of goods in the market because no business or SME wants to run at loss,” he said.

On his part, Vincent Imafidon, a lawyer, decried the shortfall in the 20-hour supply for Band A consumers, noting that the action is a breach of contract and the consumers have right to sue the discos for refund.

“The discos are now businesses and can be held accountable for their actions and inactions in a law court. Many did not want the Band A, you forced them into it and the contract was a very high tariff for 20-hour electricity supply every day.

“So, anything short of the 20 hours is a breach of the contract and the discos should be held accountable and they must also settle it. But they hardly do that and the consumers, including me, seem helpless,” the lawyer lamented.

But the story is not all bad as many residents also confirm and appreciate the huge improvement in electricity supply, particularly for those in the Band A tariff.

While there is a shortfall, the supply for them is far better than now under the increased tariff than before the banding and hike.

“Yes, we have more supply now than before the band thing and tariff hike,” Oyekunle confessed.

Read also: Nigerians to be hit by another electricity tariff hike after jumbo band A increase

Adima Ojure, an auditor and also an Abuja Disco consumer, also confirmed the improvement, saying that the difference is clear now that consumers are paying more.

“As much as I appreciate the improvement in power supply since the band grading, the Discos should also respond with the promised 20-hour supply because they often don’t meet that target when grid collapses, rain or wind disrupts and much is leaving my pocket every two weeks to pay for the high tariff,” she said.

Ademola Lukmon, a resident of Bucknor Estate at Ejigbo, Lagos, noted that his light does not blink and if it does, restoration comes shortly.

“The disco in my area is meeting the 20-hour electricity supply. I am on Band A, and I use N10,000 every week and about N40,000 in a month. The Ikeja Disco has no option than to give us steady supply because over 90 percent of the consumers here use prepaid. So, if they don’t supply, they will not make money. That is a simple business reality,” Lukmon said.

Likewise, the federal government is not satisfied with the discos’ performance, insisting that they are the weakest link in the power supply value chain.

Expressing his disappointment, Adebayo Adelabu, Minister of Power, once took a swipe at the Discos, decrying that despite tariff adjustments that boosted market liquidity by 70percent, raising sector revenue from N1 trillion in 2023 to N1.7 trillion in 2024, the distribution segment of the power supply value chain remained the weakest link.

Apart from the high tariff, the government, according to the minister, launched a N700 billion Presidential Metering Initiative (PMI) and a World Bank-backed programme targeting 4.3 million meters by 2025, out of which 75,000 units were deployed in April 2024, while additional 200, 000 were expected in May, all in a bid to close the gap and boost fair billing and financial sustainability for the Discos.

Despite the above incentives, four Discos are under the management of banks and AMCON, a development that is worrisome to some observers, who wonder why such would happen considering the hike in tariff and subsidy by the government.

“The Discos are business entities and cannot say they are not making profit with the hike in tariff. I think it is corruption and rot in the system that is playing out,” Mathias Ogala, an economist, said.

He is also worried that the both the banks and AMCON cannot manage the Discos, hence urging the government to look for fresh buyers, who are competent in the electricity business, whether local or foreign.

He also thinks that the Nigerian Electricity Regulatory Commission recent warning that all electricity customers, except those already on Band A, should be prepared for a cost-reflective tariff, should not apply until Discos proof that tariff hike guarantees steady power supply.

“Everything should not be about hike, what of service delivery? Those on Band A are still not getting the much-promised supply. The government and regulators should balance hike with service and not over charge and underdeliver at the end,” he noted.

He noted that while those who can afford the 20-hour supply are enjoying it, blackout has worsened for those in other bands, whose tariffs are too low to attract Discos’ attention.

“Those who said that Nigeria is running two economies currently are right considering the realities on ground for those who have and those who don’t have. Electricity has become a luxury that only those with money can afford for 20 hours a day,” he lamented.

Ojure argued that if many outside the Band A cannot afford the current tariff, adjudged to be very low, they would not if the tariff increases, meaning blackout for many in that category.

“The government, regulators, and the consumers should meet and workout an efficient model because being on Band A has not guaranteed 20-hour supply as promised by the Discos. So, how will hike across the other bands guarantee supply? We need the government to take action and not allow Discos to rip-off poor consumers,” she said. (BusinessDay, excluding headline)