The Federal Government’s subsidy payments to electricity distribution companies have risen sharply, with outstanding debts now standing at ₦982.4 billion as of May 2025.
This marks an increase of ₦5.3 billion, or 2.7%, from the January figure.
Data sourced from the Nigerian Electricity Regulatory Commission (NERC)’s monthly Multi-Year Tariff Orders (MYTO) reveals a fluctuating trend in subsidy payments—starting at ₦196.44bn in January, dipping slightly in February and March, before climbing to ₦201.75bn in May.
The rise in subsidy is attributed to higher generation costs and ongoing volatility in the foreign exchange market.
Despite efforts to reform the power sector, the government continues to shoulder roughly 50% of the cost-reflective tariff for electricity consumers on Bands B to E. While Band A customers pay over ₦210/kWh, others pay an average of ₦118/kWh.
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A breakdown of the MYTO for May shows major subsidy allocations to key DisCos:
Ibadan: ₦24.59bn (up from ₦24.29bn in April)
Abuja: ₦28.99bn (up from ₦28.64bn)
Eko: ₦23.45bn
Ikeja: ₦27.85bn
Port Harcourt: ₦14.94bn
Jos: ₦12.81bn
Yola: ₦8.05bn
Benin: ₦16.11bn
Enugu: ₦15.69bn
Kano: ₦14.43bn
Kaduna: ₦14.79bn
Meanwhile, efforts to resolve the sector’s mounting debt—now over ₦4 trillion—have stalled. A proposed meeting between President Bola Tinubu and electricity generation companies (GenCos), championed by the Minister of Power, Adebayo Adelabu, is yet to materialize.
The meeting, aimed at finding a solution to the sector’s liquidity crisis, has been repeatedly delayed, with the latest postponement linked to the upcoming Eid holidays and the President’s travel plans.