Abuja, October 18, 2023 – The Nigerian Electricity Regulatory Commission (NERC) disclosed on Wednesday that the Federal Government disbursed a total of N135.23 billion to subsidize electricity consumption during the second quarter of 2023. This revelation comes from NERC’s Q2 2023 report.
NERC outlined that the N135.2 billion was allocated by the Federal Government to address revenue generation shortfalls in the power sector for the period under review. This figure marks a substantial increase of N99.21 billion, signifying a staggering 275% rise when compared to the N36 billion expended during the first quarter of 2023.
The report further elucidated that the government’s subsidy commitment for 2023/Q2 was N135.23 billion, a significant surge from the N36.02 billion subsidy recorded in 2023/Q1. NERC attributed this substantial increase to the absence of cost-reflective tariffs across all distribution companies.
The report emphasized that the surge was a direct outcome of the government’s policy aimed at harmonizing the exchange rate.
According to the findings, the average monthly subsidy obligation incurred by the government amounted to N45.08 billion in the second quarter of 2023.
The Federal Government’s considerable subsidy for electricity consumption underscores the ongoing challenges in Nigeria’s power sector, as it grapples with revenue shortfalls and the need for more sustainable tariff structures.
Stay tuned for more updates on this financial development and other important news in Nigeria.