FG Spent N700bn On Electricity Subsidy In 2023 - Minister Of Power Reveals

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FG Spent N700bn On Electricity Subsidy In 2023 - Minister Of Power Reveals

The sum of N700 billion has been spent so far by the Tinubu-led administration to subsidize electricity.

According to the Minister of Power, Adebayo Adelabu, the Federal Government still subsidises electricity because the current tariff DISCOs are allowed to charge is not cost-reflective.

The Minister made this known during his official working visit to the Ibadan Electricity Distribution Company (IBEDC) Head Office in Ibadan as part of his nationwide working visit, beginning in Oyo State, on Monday, January 15.

‘’As it is today, the Federal Government still subsidises electricity because the current tariff DISCOs are allowed to charge is not cost-reflective. This is why the Federal Government spent close to N700 billion in 2023 to subsidise electricity. If tariffs are left at this current rate, it is projected that the government will spend about N1.7 trillion to subsidise electricity. The FG cannot afford that. ”Tribune quotes him as saying

He said before there can be any tariff review, there would be sensitization and advocacy to justify the upward review. He added that the tariff review would be “graduated,” meaning that a higher review would go to the high-income segment of society, while the vulnerable would pay less.

Adelabu also stated that “there must be an improved power supply” for the review to take place.

‘’There must be an upward review of the electricity tariff in order to reduce the amount of subsidy required. If we make the tariff 100 per cent cost-reflective, the burden will be too much on our people. We don’t want that. To reduce the burden on our people, it is only a fraction of the tariff review that will be reflected.” he said.