The Federal Government has announced plans to begin the gradual phase-out of electricity subsidies from 2027 as part of ongoing reforms in Nigeria’s power sector.

Speaking during a media briefing in Abuja on Friday, Minister of Power Joseph Tegbe said the subsidy removal would be implemented in phases and would not result in an immediate increase in electricity tariffs.

No Immediate Tariff Increase

Tegbe assured Nigerians that the government has no plans to raise electricity tariffs in the near future despite the proposed reduction in subsidy payments.

According to him, the phased approach is designed to reduce the financial burden on the government while ensuring consumers continue to enjoy the benefits currently provided under the subsidy scheme.

He stressed that the reform would be carefully managed to avoid sudden shocks to electricity users.

Government Targets Power Sector Reforms

Nigeria’s electricity sector has for years battled a significant funding gap created by the difference between the actual cost of generating and transmitting electricity and the amount distribution companies recover from consumers.

To keep the sector running, the Federal Government has consistently covered the shortfall through subsidy payments.

With the planned reforms, the government hopes to gradually reduce its subsidy obligations from 2027 while working towards a more sustainable electricity market.