The Federal Government may spend about N2 trillion to subsidise electricity this year as it maintains its position against an immediate increase in electricity tariffs.
The Minister of Power, Joseph Tegbe, disclosed the government’s position on electricity tariffs at a media parley in Abuja on Monday while marking his first 100 days in office.
“There are no immediate plans to increase electricity tariffs. Our goal is to build a commercially viable power sector while protecting vulnerable consumers,” Tegbe said.
The minister’s position comes against the backdrop of the N1.93tn electricity subsidy incurred by the Federal Government in 2025, according to the Nigerian Electricity Regulatory Commission’s 2025 Annual Report.
NERC said the subsidy obligation represented 57.44 per cent of the total Nigerian Bulk Electricity Trading invoice during the year and averaged N160.69bn monthly.
The commission said the government incurred the subsidy because allowed electricity tariffs remained below cost-reflective levels, with the Federal Government covering the resulting gap.
“In the absence of cost-reflective tariffs, the government undertakes to cover the resultant gap (between the cost-reflective and allowed tariff) in the form of tariff subsidies.
“It is important to note that due to the absence of cost-reflective tariffs across all DisCos, the government incurred a subsidy obligation of N1.93tn (57.44 per cent of total NBET invoice) during the year,” the commission said.
With the government maintaining that there are no immediate plans to increase tariffs, the subsidy burden could remain around the N2tn level this year. The subsidy burden neared N2tn in 2024 and 2025 despite the Band A to E tariff categorisation introduced in 2024.
