The Federal Government of Nigeria incurred a power subsidy obligation of ₦418.79 billion in the fourth quarter of 2025, according to the latest report by the Nigerian Electricity Regulatory Commission (NERC).
This reflects a decline from ₦458.75 billion recorded in Q3 2025, indicating an 8.71 percent reduction in subsidy burden.
NERC attributed the decrease partly to increased energy allocation to Band A customers, which rose from 40 percent to 45 percent, in line with efforts to improve electricity supply quality.
The report also showed that while most electricity distribution companies (DisCos) maintained strong remittance levels, performance varied significantly across regions, with some operators recording weaker compliance.
The regulator noted that in the absence of cost-reflective tariffs, government continues to bridge the gap between actual generation costs and allowed tariffs through subsidies.
The development highlights ongoing challenges in Nigeria’s power sector, particularly around tariff sustainability, liquidity, and infrastructure efficiency.
