Nigerians to pay higher electricity bills as FG plans to remove subsidy in 2027

• Power Minister Joseph Tegbe says electricity subsidy will be removed from 2027.

• The government says the move will help make the power sector financially sustainable.

• Subsidy removal could lead to changes in electricity costs for consumers.

• FG says the transition will be gradual and is aimed at improving the power sector.

Nigerians may face higher electricity bills from 2027 as the Federal Government plans to end electricity subsidies, the Minister of Power, Joseph Olasunkanmi Tegbe, has announced.

Tegbe said the government is working towards removing electricity subsidies as part of efforts to make the power sector financially sustainable and encourage more investment in electricity generation and distribution.

The minister disclosed that the subsidy removal would be implemented gradually, adding that the government was not planning an immediate increase in electricity tariffs as part of the transition.

Electricity subsidies currently cover the gap between the actual cost of supplying power and the amount paid by consumers through regulated tariffs. Removing the subsidy means electricity prices could move closer to the cost of generating and delivering power, depending on future tariff decisions by regulators.

Tegbe explained that the move is necessary to address challenges affecting Nigeria’s power sector, including accumulated debts, funding gaps and the need to attract private investment.

The Federal Government has previously introduced electricity tariff reforms, including adjustments for some categories of consumers, as it seeks to reduce the cost burden on public finances and improve the reliability of power supply.

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The minister said the government’s focus is to create a power market that can operate sustainably while protecting consumers during the transition.

Nigeria’s electricity sector has continued to face challenges, including inadequate infrastructure, gas supply constraints, limited generation capacity and financial difficulties among operators.

The planned removal of the subsidy in 2027 is expected to form part of wider reforms aimed at restructuring the country’s power sector.