The Federal Government incurred a total electricity subsidy shortfall of ₦1.95 trillion in 2024, according to the Nigerian Electricity Regulatory Commission’s (NERC) annual report. The shortfall was a result of the gap between cost-reflective tariffs and what customers were actually charged throughout the year.
Breakdown of the figures showed that ₦633 billion was recorded in the first quarter, ₦380 billion in the second, ₦464 billion in the third, and ₦471 billion in the fourth quarter. NERC noted that the government covered this gap through tariff shortfall funding, although it did not confirm if the entire amount was paid.
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In a separate update for April 2025, the electricity Distribution Companies posted a 40 percent year-on-year revenue increase, billing ₦257.57 billion for the month. The Discos collected ₦199.85 billion, marking a collection efficiency of 77.6 percent — up from 71.1 percent in March.
Despite this rise in revenue, energy supply fell by over 9 percent, with 2,622 gigawatt-hours received and 2,184 GWh billed. The revenue boost is attributed mainly to the new cost-reflective tariff of ₦209 per kilowatt-hour for Band A customers, up from ₦66 previously, as part of the government’s ongoing effort to reduce subsidies and attract investment.
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