The Minister of Power, Adebayo Adelabu, has revealed that the Federal Government owes electricity generation companies (GenCos) and distribution companies (DisCos) a staggering N4 trillion in outstanding subsidies.
During the ongoing public presentation of Nigeria’s National Integrated Electricity Policy and Integrated Resource Plan in Abuja, Adelabu highlighted how this massive debt impedes the sector’s ability to provide efficient service to consumers.
The minister broke down the debt, stating that GenCos are owed N2 trillion as legacy debt, while another N1.9 trillion is owed for electricity subsidies in 2024. Additionally, DisCos are owed N450 billion for the same period.
“How can we expect GenCos to perform optimally when they are owed a total of N4 trillion?” Adelabu questioned. “How can they pay for gas, maintain turbines, and staff their operations under such financial strain?”
He acknowledged that the government could no longer sustain the current subsidy model due to rising electricity consumption and the sector’s liquidity issues. While no tariff increases were promised, Adelabu emphasized the need to revisit the current tariff structure to improve the sector’s performance.
The minister also expressed concern over the lack of investment in DisCos’ distribution networks, noting that customer migration to higher tariff bands has not met expectations due to insufficient infrastructure investment.
He suggested that the government would soon introduce a new intervention model focused on helping those most in need.
