Electricity Tariff Conundrum: Government Regulations and Market Forces on Households and Businesses in Rivers State, Nigeria (2018–2024)

The objective of this study is to assess the economic effects of increasing electricity tariffs in Rivers State, Nigeria for the years 2018 – 2024 in the context of consumers, as well as the micro, small, and medium enterprises (MSMEs). A survey design strategy was employed, and 400 questionnaires were administered to the senior and junior Local Government areas based on purposive sampling (385 were deemed usable). Descriptive statistics were analysed using SPSS, with the mean decision benchmark set at 2.50. Sustained tariff increase results in an increase in the level of inflation, which in turn decreases the level of disposable income (the amount of income available for spending or saving after taxes have been paid) available to consumers, increases the cost of operation in an MSME, reduces the levels of investment or business expansion, and increases the levels of unemployment (no job available for an individual who is capable of working and actively seeking work). An average mean score of 3.4 translates to a significant level of agreement (economic conditions consisting of the goods, services, and money of a region or country) on worsened conditions as a result of increased levels of tariffs.  While tariff reform is intended to improve the operational efficiency of the market, the lack of reliable supply and the absence of income growth increase the negative effects on welfare. The study proposes the following: restructuring tariffs based on income, tax relief, expansion of renewable sources of energy, and providing the market with more social protection and a transparent regulatory framework.