Special Adviser to President Bola Tinubu on Energy, Olu Verheijen, disclosed that the federal government spends N200 billion monthly on electricity subsidies, which according to her benefits the wealthiest 25% of Nigerians rather than those in need.
She made this statement today while clarifying recent claims that she had confirmed a two-thirds (65%) hike in electricity tariffs
Verheijen explained that; “It has become necessary to clarify media reports suggesting an imminent 65% increase in electricity tariffs. This is a misrepresentation of what I actually said in a recent press interview,”.
“I highlighted the fact that, following the increase in Band A tariffs in 2024, current tariffs now cover approximately 65 per cent of the actual cost of supplying electricity, with the Federal Government continuing to subsidise the difference,”
Verheijen emphasized that the immediate focus is on improving electricity supply, reducing outages, and protecting vulnerable Nigerians.
To ensure that subsidies reach low-income households, the Federal Government is working on a targeted subsidy system that will make electricity more affordable and accessible to struggling families.
Addressing concerns about unmetered customers potentially overpaying if tariffs increase, Verheijen assured Nigerians that the government would accelerate the rollout of seven million prepaid meters under the Presidential Metering Initiative starting this year.
“This will finally put an end to estimated billing, ensuring transparency in electricity charges and improving revenue collection,” she added.
Verheijen also disclosed that the government is working to clear mounting debts owed to power generation companies, which have hindered investments in new infrastructure and stable electricity supply.
“For years, these debts have prevented investments in new infrastructure and hampered efforts to improve electricity supply. By clearing these outstanding obligations, the government is ensuring power companies can reinvest in better service delivery,” she stated.
In a bid to also reduce cost of power, she hinted that the Federal Government is also introducing fiscal incentives such as VAT and customs duty waivers to lower the cost of alternative power sources like Compressed Natural Gas (CNG) and Liquefied Petroleum Gas (LPG).
Verheijen assured that every policy is aimed at benefiting Nigerians by eliminating unfair billing practices, ensuring subsidies reach the right people, and creating conditions for stable, affordable electricity.