The Nigerian government spent N628.61 billion on electricity subsidies as Electricity Distribution Companies earned N1.08 trillion in revenue in 2023.
This is according to the latest sectoral report from the Nigerian Electricity Regulatory Commission released on Wednesday.
The report stated that power subsidies in the first, second, third, and fourth quarters 2023 were N36.02 billion, N135.23 billion, N204.6 billion, and N252.76 billion, respectively.
It noted that electricity distribution companies raked in N247.09 billion, N267.86 billion, N267.61 billion, and N294.95 billion in the first, second, third, and fourth quarters of 2023, respectively.
“It is important to note that due to the absence of cost-reflective tariffs across all Discos, the government incurred a subsidy obligation of N252.76bn in 2023/Q4.
“This increase is mainly attributable to the government’s policy to harmonise exchange rates while also directing that end-user customer tariffs remain at the December 2022 approved rates,” NERC said, commenting on the amount spent on electricity subsidy in Q4 2023.
Explaining the subsidy spent on power in the third quarter, NERC said, “It is important to note that due to the absence of cost-reflective tariffs across all Discos, the government incurred a subsidy obligation of N204.59 billion in 2023/Q3 (an average of N68.20bn per month).”
