BY GLORIA AKUDORO
The Nigerian Electricity Regulatory Commission (NERC) has revealed that the subsidy payment for electricity consumed in the first half of 2025 has risen to N1.186 trillion.
NERC disclosed in the latest analysis of monthly Multi Year Tariff Orders (MYTO), in addition to the federal government’s outstanding debt of over N4 trillion owed to electricity generation companies.
NERC’s order showed that the subsidy, which is owed to Electricity Distribution Companies (DisCos) increased by 27 percent from the N935.81 billion the federal government incurred in the second half of 2024 and 17 percent increase from the N1.013 trillion incurred in the first half of 2024.
A breakdown of the subsidy indicated that the government owed N196.4bn in January, N193.09bn in February; N194.6bn in March; N198.4bn in April; N201.7bn in May and N201.8bn in June.
It also showed that the Abuja Electricity Distribution Company (AEDC) got the highest amount of N170.6 billion followed by Ikeja Electricity Distribution Company (IE) with N163.7 billion, then Ibadan Electricity Distribution Company (IBEDC) with N144.7 billion.
Others DisCos include Eko Electricity Distribution Company (EKDC), N137.7 billion, Benin Electricity Distribution Company (BEDC) with N94.7 billion, Enugu Electricity Distribution Company (EEDC) with N94.4 billion; Port Harcourt Electricity Distribution Company (PHEDC) with N87.9 billion; Kaduna Electricity Distribution Company (KAEDCO) with N87.2 billion; Kano Electricity Distribution Company (KEDCO) with N85.08 billion; Jos Electricity Distribution Company (JEDC) with N72.6 billion and Yola Electricity Distribution Company (YEDC) with N47.1 billion.
According to NERC, in the absence of cost-reflective tariffs, the government undertakes to cover the resultant gap between the cost-reflective and allowed tariff in the form of tariff subsidies.
But for ease of administration, the subsidy is only applied to the generation cost payable by DisCos to NBET at source in the form of a DisCo’s Remittance Obligation (DRO).
The Order indicated that the DRO represents the total GenCo invoice that is billed to the DisCos by Nigerian Bulk Electricity Trading plc (NBET) based on what the allowed DisCo tariffs can cover.
In May, the Association of Power Generating Companies (APGC), threatened to shut down tools over the N4trn owed by the federal government in subsidy and legacy debt. They include N2 trillion for 2024 and N1.9 trillion for legacy.
But in April, the Minister of Power, Adebayo Adelabu, had promised to pay the debt following high-stakes talks between Power Minister, Adebayo Adelabu and Chairmen of Generating Companies of Nigeria (GenCos) in Abuja.
The statement signed by his Special Adviser on Strategic Communications and Media Relations, Bolaji Tunji, said the move aims to avert an imminent collapse of the power infrastructure in the country.