FG to Begin Phasing Out Electricity Subsidies From 2027, Rules Out Immediate Tariff Hike

The Federal Government has announced plans to begin a gradual phase-out of electricity subsidies from 2027 as part of ongoing reforms aimed at improving the financial sustainability of Nigeria’s power sector and tackling its growing debt burden.

Minister of Power, Joseph Tegbe, disclosed this during a media interactive session on Friday, explaining that the subsidy removal would be implemented in phases to avoid placing undue hardship on Nigerians. He assured citizens that vulnerable consumers would continue to receive necessary support through targeted interventions as the reforms progress.

Tegbe also dismissed concerns over an imminent increase in electricity tariffs, stressing that the Federal Government has no immediate plans to raise tariffs despite the planned subsidy phase-out. He said the reforms are designed to improve liquidity in the electricity market, reduce the sector’s mounting debts, and attract more investment into power generation, transmission, and distribution.

The announcement aligns with the government’s broader policy of transitioning to a more cost-reflective electricity pricing system while maintaining support for low-income and vulnerable households.