Nigerians should prepare for higher electricity tariffs as the Federal Government moves to reduce power subsidies, Minister of Power Adebayo Adelabu has said.
Speaking during a meeting with the Chairmen of Electricity Generating Companies (GenCos) in Abuja, Adelabu explained that the current subsidy burden—estimated at over **N4 trillion**—is no longer sustainable for the Nigerian economy.
“We must accept that our economy cannot continue to carry these subsidies. Citizens must pay the appropriate price for the energy they consume,” he said.
While assuring that the government will still support *economically disadvantaged Nigerians*, Adelabu did not clarify who falls into this category.
According to the Nigerian Electricity Regulatory Commission (NERC), in its February 2024 report, the average actual cost of electricity was **N116.18 per kilowatt-hour (kWh)**, but consumers only paid **N88.21/kWh**, leaving a subsidy gap of **N27.97/kWh**. Only about **15% of power users**, classified under Band A, are not receiving subsidies.
The Power Minister also promised that the Federal Government is working to reduce the GenCos’ debt burden through a combination of cash payments and financial instruments like promissory notes. He revealed that President Bola Ahmed Tinubu would soon meet with GenCos to find a lasting solution.
“There is an urgent need to pay a substantial part of this debt. Without it, the sector will face greater risk,” Adelabu added.
Chairman of Mainstream Energy Solutions, Col. Sani Bello (retd.), said the N4 trillion debt is crippling GenCos, leaving them unable to access loans or maintain their infrastructure.
“This situation is threatening the entire power sector. Without immediate help, we may witness a complete collapse,” he warned.
Kola Adesina, chairman of Egbin Power and First Independent Power Limited, also raised concerns, calling the situation “a national emergency.”
Dr. Joy Ogaji, CEO of the Association of Power Generating Companies, blamed the crisis on persistent payment defaults, unreliable gas supply, and the crashing value of the naira, which has fallen from **N157/\$1 in 2013 to N1,600/\$1 today**.
“The risks are becoming unbearable for GenCos. Yet we remain committed to powering the country,” she said.
The warning signals a major shift in Nigeria’s electricity sector, with consumers likely to feel the pinch unless targeted support measures are clearly defined and swiftly implemented.
