The Federal Government has said it can no longer continue to bear the financial burden of electricity tariff shortfalls while being expected to provide power to every Nigerian.
Minister of Power, Joseph Tegbe, made this known while speaking on the financial challenges facing Nigeria’s electricity sector, particularly the difference between the cost of generating and supplying electricity and the tariffs paid by consumers.
Tegbe explained that the government could no longer sustain the existing arrangement under which it shoulders the financial burden arising from electricity subsidies.
He identified poor revenue collection, inadequate metering and outstanding debts owed to electricity generation companies as some of the major challenges affecting the sector.
The minister disclosed that the government was considering a transition from the Nigerian Bulk Electricity Trading (NBET) model to bilateral electricity agreements, which would allow electricity suppliers and buyers to negotiate commercial terms directly.
According to him, the proposed arrangement is expected to strengthen payment discipline and improve the financial sustainability of Nigeria’s electricity market.
Tegbe also revealed that Nigeria has a metering gap of approximately 40 per cent, highlighting the need to accelerate the provision of meters to electricity consumers.
He said more than 700,000 meters had been deployed within six months, while the government planned to install 7.5 million meters over the next two to three years.
The planned expansion of metering is expected to improve billing transparency, reduce estimated billing and strengthen revenue collection across the electricity sector.
The minister’s remarks come amid ongoing efforts to address financial difficulties in the power sector and establish a more sustainable electricity market.
