KERC advances transparent tariff modelling process for electricity market

The Kogi State Electricity Regulatory Commission (KERC), has announced significant progress in its ongoing electricity tariff modelling process, aimed at establishing affordable, acceptable, and cost-reflective tariffs for consumers in the state.

In a public notice issued by the Commission, and made available to the media by it Head, Public Affairs, Ali Atabor, KERC stated that the exercise aligns with its statutory mandate to regulate the electricity market while balancing consumer protection with utility sustainability. The process is designed to ensure improved service delivery and long-term investment in the sector.

According to the Commission, the new tariff framework will be transparent, fair, affordable, and cost-reflective.

It is expected to enable the electricity distribution company to recover efficient costs while sustaining investments in network expansion, reliability, and overall service quality.

KERC revealed that it adopted a structured and stakeholder-inclusive approach in developing the tariff model.

According to the Commission, the process began with comprehensive data collection and submission from Kogi Electricity Distribution Limited, KEDL, covering energy received, customer numbers, metering coverage, asset conditions, operating costs, and revenue performance.

The Commission said it conducted rigorous verification, reconciliation, and cleaning of all submitted data to ensure accuracy and compliance with regulatory and industry standards.

This was followed by extensive engagements with sector stakeholders, experts, development partners, and industry participants to align the process with global best practices.

Financial and economic analysis formed the next stage, where KERC undertook a detailed review of operational expenditures, capital investments, financing costs, technical and commercial losses, and service obligations. The goal was to assess cost prudence and efficiency before modelling.

Using validated data, the Commission simulated various tariff scenarios to assess potential impacts on consumers, utility sustainability, investment needs, and long-term market development.

The objective, KERC said, is to achieve a balanced and sustainable tariff structure for all parties.

To promote transparency, KERC developed a public consultation paper outlining the methodology, assumptions, findings, and proposed tariff options. This guided broad-based consultations with consumers, businesses, civil society, government institutions, and other stakeholders to gather feedback.

The Commission added that specialist technical review sessions involving economists, engineers, financial analysts, and regulatory experts will hold on Thursday, 25 June 2026 to critically assess all assumptions, methodologies, and projections used in the modelling process.

The process will culminate in an Issue-Day Stakeholders’ Conference scheduled for June 25, 2026, in Lokoja.

KERC said the conference will provide a platform for reviewing outcomes, addressing concerns, and building consensus on the proposed tariff framework before final implementation.

KERC emphasised that the entire exercise is guided by professionalism, transparency, and accountability.

The Commission reiterated its commitment to delivering a tariff structure that protects consumers, ensures affordability, improves service reliability, encourages infrastructure investment, and supports economic growth in Kogi State.