The Federal Government has announced plans to begin the gradual removal of electricity subsidies from 2027, as part of a sweeping reform aimed at reducing the mounting financial burden in Nigeria’s power sector while assuring consumers there will be no immediate tariff increase.
The announcement was made by the Minister of Power, Joseph Tegbe, during a media briefing on Friday. He said the government had received a mandate from President Bola Tinubu to clear legacy debts in the electricity sector and establish a sustainable financing structure that would eliminate the need for continued subsidies.
FG Targets Sustainable Power Sector
According to Tegbe, the subsidy removal will be implemented gradually to avoid disrupting electricity consumers and to improve the long-term financial health of the industry.
He stressed that the government is not planning an immediate electricity tariff hike, adding that reforms would be carried out in phases while efforts continue to improve electricity supply nationwide.
Power Sector Burden Hits Trillions
The government said the electricity subsidy has become increasingly difficult to sustain due to the huge debts owed across the power value chain.
Officials noted that the reform aligns with ongoing efforts to settle legacy obligations owed to electricity generation companies and strengthen the financial viability of the sector.
Consumers Assured of Gradual Transition
Despite concerns that subsidy removal could increase electricity costs, the Minister assured Nigerians that consumers would continue to receive improved services while the transition is being implemented.
He maintained that the objective is to create a more efficient and financially stable electricity market without abruptly shifting the burden to consumers.