
The Special Adviser to the President on Energy, Olu Verheijen, has disclosed that the Federal Government spends over N200 billion per month on electricity subsidies.
This, she said benefits the wealthiest 25 percent of Nigerians rather than those who truly need assistance.
Verheijen, disclosed this in a statement issued on Monday to clarify media reports suggesting an imminent 65 percent increase in electricity tariffs.
To address this, she said the Federal government is working towards a targeted subsidy system to ensure that low-income households receive most support.
“This approach will make electricity more affordable and accessible for millions of hardworking families,” she noted.
The SA who claimed she was misquoted in her last press interview on tariffs, said, “I highlighted the fact that, following the increase in Band A tariffs in 2024, current tariffs now cover approximately 65 percent of the actual cost of supplying electricity, with the Federal government continuing to subsidize the difference.
“Also, while the government is indeed committed to ensuring fairer pricing over the long term, the immediate focus is on taking decisive action to deliver more electricity to Nigerians, ensure fewer outages, and guarantee the protection of the poorest and most vulnerable Nigerians.”
Verheijen, while highlighting other Federal government’s power sector priorities, disclosed the government’s plan to rollout smart meters starting this year (2025) to end estimated billing for 7 million households.
“One of the most significant steps in this reform is the Presidential Metering Initiative, which is accelerating the nationwide rollout of 7 million prepaid meters, starting this year.
“This will finally put an end to the practice of estimated billing, giving consumers confidence in what they are paying for and ensuring transparency in electricity charges.
“Metering will also improve revenue collection across the sector and will attract the investments needed to strengthen Nigeria’s power infrastructure”, she said.
On settlement of legacy debt, the SA said, “the Federal government is addressing one of the major roadblocks to improved service, the mounting debts owed to power generation companies. For years, these debts have prevented investments in new infrastructure and hampered efforts to improve electricity supply.
“By clearing these outstanding obligations, the government is ensuring that power companies can reinvest in better service delivery, stronger infrastructure, and a more stable electricity supply for all Nigerians.”
Additionally, she said through a range of fiscal incentives, including VAT and Customs Duty Waivers, the Federal Government is working to lower the cost of alternative power sources such as Compressed Natural Gas and Liquified Petroleum Gas.
“The government fully understands the economic realities facing citizens and is committed to ensuring that reforms in the power sector lead to tangible improvements in people’s daily lives.
“Every policy is designed with the Nigerian people in mind — eliminating unfair estimated billing, ensuring that subsidies benefit the right people, and creating the conditions for stable, affordable electricity.
“These reforms are laying the foundation for better service delivery, expanded access to electricity for homes and businesses, and unlocking prosperity for all Nigerians,” she said.