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FG Plans to Phase Out Electricity Subsidies From 2027 as Power-Sector Debts Rise

The Federal Government says it plans to phase out electricity subsidies from 2027 as part of efforts to tackle mounting debts in the power sector. Power Minister Joseph Tegbe said the withdrawal would be gradual and that the government intends to improve electricity supply without immediately raising tariffs. He said the administration has been directed to clear legacy debts and create a sustainable funding structure for the sector. The subsidy burden was estimated at about ₦3 trillion as of February 2024, while power generation companies say they are owed roughly ₦6.5 trillion. President Bola Tinubu has approved a ₦4 trillion bond programme to settle verified debts, including ₦501 billion issued in January and a further ₦729 billion announced on July 20. The government is also considering how electricity subsidy costs should be shared among the federal, state and local governments in the 2026 budget.

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H
hala

What concrete improvements in electricity supply should people expect before the gradual subsidy withdrawal begins in 2027?

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P
prince

Exactly. Any phased removal should come with visible, reliable power improvements first, not just higher bills.

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B
bisi

A gradual plan sounds less abrupt, but households will still watch closely for better supply as costs change.

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Y
yemi

Phasing out subsidies may address debts, but the announcement will be harder to accept without visible service improvements first.

0
K
kris

Government should clearly publish timelines, tariff changes, and supply targets so businesses and households can plan ahead.

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