Olu Verheijen, Special Adviser to President Bola Tinubu on Energy, clarified reports about a potential 65 percent increase in electricity tariffs, calling it a ‘misrepresentation.’ She explained that the recent increase in Band ‘A’ tariffs means current rates cover about 65 percent of the actual cost of electricity supply, with the federal government subsidizing the remaining amount.
The government currently spends approximately N200 billion monthly on electricity subsidies, which disproportionately benefit the wealthiest 25 percent of Nigerians rather than those in need. While there is a commitment to fairer pricing in the long run, Verheijen emphasized that the immediate goal is to increase electricity supply, reduce outages, and protect vulnerable populations.
Key priorities for the power sector include the Presidential Metering Initiative (PMI), aimed at rolling out 7 million prepaid meters this year. This initiative will eliminate estimated billing, enhance consumer confidence in charges, improve revenue collection, and attract investment to strengthen Nigeria’s power infrastructure.
To ensure support reaches low-income households, the government is developing a targeted subsidy system that will make electricity more affordable for millions of families. Verheijen also addressed the issue of mounting debts owed to power generation companies, which have hindered infrastructure investment and service improvement. By clearing these debts, the government aims to enable power companies to reinvest in better service and infrastructure.
Additionally, through fiscal incentives like VAT and customs duty waivers, the government is working to reduce costs for alternative power sources such as Compressed Natural Gas (CNG) and Liquefied Petroleum Gas (LPG).
Verheijen affirmed the government’s understanding of citizens’ economic challenges and its commitment to ensuring that power sector reforms lead to real improvements in daily life. Every policy aims to eliminate unfair estimated billing, ensure subsidies reach the right people, and create conditions for stable, affordable electricity, ultimately laying the groundwork for better service delivery and increased access for all Nigerians.
FG Sets Record Straight on Electricity Tariff Hike, Discloses N200bn Monthly Subsidy.
