Abuja, Nigeria— The Federal Government has announced plans to begin a gradual withdrawal of electricity subsidies from 2027 as part of broader efforts to improve the financial sustainability of Nigeria’s power sector.
Minister of Power, Joseph Tegbe, made the disclosure on Friday during a media interactive session, explaining that the reform is intended to reduce the government’s rising subsidy obligations while creating a more commercially viable electricity market.
According to the minister, the subsidy phase-out will not happen all at once. Instead, it will be implemented in stages, with measures designed to protect low-income and vulnerable electricity consumers throughout the transition.
Tegbe also reassured Nigerians that the government is not considering an immediate increase in electricity tariffs, stressing that the current reform agenda is focused on strengthening the sector without placing additional short-term financial pressure on consumers.
“The phase-out of electricity subsidies will begin from 2027. However, there are no immediate plans to increase electricity tariffs. Our goal is to build a commercially viable power sector while protecting vulnerable consumers,” the minister said.
Consumer Support Measures
The minister said the Power Consumer Assistance Fund will serve as a key support mechanism for vulnerable households, helping to cushion the impact of the gradual removal of subsidies.
He explained that the fund is expected to provide targeted assistance to eligible electricity users as the government rolls out the reform programme.
“The Power Consumer Assistance Fund will play a critical role in cushioning the impact on vulnerable consumers as we implement these reforms,” he added.
Government to Release Implementation Timeline
Tegbe stated that further details, including the implementation timetable and additional consumer protection measures, will be made public as the reform process advances.
He noted that electricity subsidies have placed significant pressure on government finances over the years, making reforms necessary to improve the long-term stability, efficiency and investment potential of Nigeria’s electricity sector.
The Federal Government has repeatedly stated that ongoing power sector reforms are aimed at ensuring reliable electricity supply while balancing affordability for consumers and financial sustainability for operators.
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