According to the Nigerian Electricity Regulatory Commission (NERC), the Federal Government’s (FG) commitment to electricity tariff subsidies was N1.92 trillion in 2025 as the government continues to cover the difference between cost-reflective electricity tariffs and customer rates.
According to NERC’s 2025 industry report, the government’s gross tariff subsidy obligation for the year was N1.928 trillion, or 57.44 per cent of all Nigerian Bulk Electricity Trading (NBET) invoices. This amounts to an average monthly subsidy requirement of N160.69 billion.
The first quarter’s subsidy obligation was N536.40 billion; the second quarter’s was N514.36 billion; the third quarter’s was N458.76 billion; and the fourth quarter’s was N418.79 billion.
Despite the FG’s instruction to freeze consumer electricity bills at the July 2024 approved rates, the 2025 number showed a minor decrease from the N1.949 trillion reported in 2024.
The progressive decrease in the quarterly subsidy obligation was ascribed by NERC to both an increase in the percentage of energy allotted to Band A consumers and a decrease in energy off-take by electricity distribution companies (DisCos) when compared to prior quarters.
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In the fourth quarter of 2025, the percentage of energy allotted to customers in bands A and B increased from 40% to 45%.
“Due to the absence of cost-reflective tariffs across all DisCos, the government incurred a subsidy obligation of N1,928.31 billion,” the commission said.
It added that the subsidy was largely attributable to the government’s policy of freezing allowed tariffs paid by customers despite increases in cost-reflective tariffs.
The federal government has launched an investigation into energy theft along the 132kV Ikorodu–Sagamu industrial corridor, where unaccounted power losses are estimated at N120 billion annually.
According to Joseph Tegbe, Minister of Power, roughly 100 megawatts of energy are lost along the route.
Speaking at a high-level stakeholder meeting in Lagos with important market players, industrial operators, and energy regulators, Tegbe issued a strict order for an open, scientific investigation into the significant differences between the amount of electricity transmitted along the corridor and the energy that distribution companies formally bill and account for.
