The Federal Government says it spent N3.14 trillion on electricity subsidies between June 2023 and December 2025, as part of efforts to cushion consumers from the impact of higher electricity tariffs.
The expenditure formed part of N30.64 trillion in incremental spending pressures incurred by the government during the 31-month period, according to figures contained in the Economic Reform Scorecard published by the Ministry of Finance.
The figures followed a presentation by Taiwo Oyedele, Minister of Finance and Coordinating Minister of the Economy, on Wednesday.
The government said the electricity subsidy was necessary to cushion consumers from higher tariffs as reforms in the power sector continued.
Electricity subsidy expenditure rose sharply from N177 billion in 2023 to N1.48 trillion in 2024, representing an increase of more than 740 percent. By December 2025, the subsidy bill stood at N1.47 trillion, a marginal 1.14 percent decline from the previous year.
The N3.14 trillion electricity subsidy was among the major expenditure pressures recorded during the period.
Other significant pressures included N9.39 trillion for wage adjustments, N9.37 trillion for the exchange-rate impact of external debt servicing, and N6.47 trillion for strategic infrastructure.
The ministry said the additional spending pressures were partly financed by N20.4 trillion in incremental resources available to the Federal Government.
These resources included N5.43 trillion from the Federal Government’s share of estimated subsidy savings, N3.12 trillion in other incremental revenues and N11.85 trillion in incremental borrowing.
However, the additional resources were insufficient to cover the spending pressures, leaving a N10.24 trillion funding gap to be absorbed from the government’s existing revenue base.
The disclosure comes as the government prepares to gradually phase out electricity subsidy payments from 2027.
In July, Joseph Tegbe, Minister of Power, said there were no plans to increase electricity tariffs, adding that the government would gradually remove subsidies from next year without depriving Nigerians of the benefits they currently receive.
The Nigerian Electricity Regulatory Commission (NERC) increased electricity tariffs for Band A customers in April 2024.
Under the revised tariff regime, Band A customers, who are expected to receive at least 20 hours of electricity supply daily, saw their tariff increase from N66 to N225 per kilowatt-hour.
NERC had said the tariff review was expected to reduce the government’s subsidy burden by about N1.14 trillion in 2024.
