NERC sets up Transmission Infrastructure Fund with N2.17/kWh tariff charge
CHIGOZIE AMADI
In a significant move to enhance power transmission infrastructure nationwide, the Nigerian Electricity Regulatory Commission (NERC) has established a Transmission Infrastructure Fund (TIF), to be financed through a N2.17/kWh charge on energy consumed by electricity customers.
According to the May 2025 Multi-Year Tariff Order (MYTO) released on Tuesday, the TIF will support critical projects aimed at strengthening the transmission network.
“This Order (MYTO May 2025) provides for the establishment of a Transmission Infrastructure Fund to support the financing of essential transmission infrastructure projects and innovative initiatives needed to enhance transmission services within the Nigerian Electricity Supply Industry (NESI),” the Commission stated.
NERC explained that the fund will be centrally managed and could also be used to secure vendor financing and other Public-Private Partnership (PPP) arrangements to bridge infrastructure gaps in the transmission network.
“A provision of N2.17/kWh of energy delivered to grid off-takers has been made as a contribution toward building the TIF in 2025,” the Order noted.
Despite the new levy, the government has retained the current electricity tariffs across all customer bands for the month of May. Customers in Band A will continue paying N209.5/kWh, while Bands B to E will maintain the frozen tariffs set in December 2022.
Speaking to Vanguard on the development, the Executive Director of PowerUp Nigeria, Adetayo Adegbemle, clarified that the creation of the TIF would not affect the actual amount consumers pay for electricity.
“Think of it like the Meter Acquisition Fund, which was introduced into the MYTO by NERC without changing the tariff payable by consumers,” he explained. “The N2.17 will be contributed by the market in a manner similar to how the contributory pension scheme operates.”
Adegbemle emphasized that the main concern lies not in financing the fund but in ensuring its effective management.
“I strongly believe it will enhance the market’s capacity to improve transmission infrastructure by accumulating significant capital for the sector, just like the Meter Acquisition Fund has done,” he said.
“The key challenge is in the implementation and administration of the fund. Investments must be directed at projects that genuinely enhance transmission infrastructure,” he added.
