The Minister of Power, Adebayo Adelabu, disclosed that the federal government owes GenCos and DisCos over N4 trillion in subsidies.
He explained that the debt burden has significantly hampered the power sector’s ability to provide reliable electricity to Nigerian consumers.
Providing details, he stated that N2 trillion is owed to GenCos as legacy debt, while N1.9 trillion covers 2024 electricity subsidies.
Additionally, electricity distribution companies (DisCos) are owed N450 billion in subsidies for 2024, further straining the sector’s financial stability.
Adelabu stressed that the government can no longer sustain the current electricity subsidy model, necessitating a targeted intervention approach.
He acknowledged that the government must reconsider the electricity tariff structure without necessarily imposing an immediate increase.
Discussing DisCos, he lamented their reluctance to invest in network upgrades, which has hindered customer migration to Band A.
The minister disclosed that the government is reviewing electricity consumer classifications to merge them into three bands: A, B, and C.
This restructuring aims to reduce tariff disparities and improve electricity supply for consumers in lower bands across the country.
