The Nigerian Electricity Regulatory Commission, NERC has revealed that the Federal Government of Nigeria has spent not less than N628.61 billion in subsidizing electricity even as electricity distribution companies pocketed N1.08 trillion in revenue in 2023.
This was revealed in the latest sectoral report from the Nigerian Electricity Regulatory Commission released on Wednesday.
The report revealed the quarterly electricity subsidies in 2023 as N36.02 billion, N135.23 billion, N204.6 billion, and N252.76 billion in the first, second, third, and fourth quarters respectively.
According to the report, electricity distribution companies earned N247.09 billion, N267.86 billion, N267.61 billion, and N294.95 billion in the first, second, third, and fourth quarters of 2023, respectively.
“It is important to note that due to the absence of cost-reflective tariffs across all Discos, the government incurred a subsidy obligation of N252.76bn in 2023/Q4.
“This increase is mainly attributable to the government’s policy to harmonise exchange rates while also directing that end-user customer tariffs remain at the December 2022 approved rates,” The NERC stated while commenting on the electricity subsidy in the last quarter of 2023.
Explaining the subsidy spent on power in the third quarter, NERC said, “It is important to note that due to the absence of cost-reflective tariffs across all Discos, the government incurred a subsidy obligation of N204.59 billion in 2023/Q3 (an average of N68.20bn per month).”
