By Victor Enengedi

The FG says it will gradually end electricity subsidy and introduce cost-reflective tariffs while protecting poor and vulnerable Nigerians.

The reforms are expected to be implemented within the next year under the proposed Power Consumer Assistance Fund The government also said Nigeria needs between $9 billion and $12 billion in annual power sector investments through 2045.

The Federal Government has reiterated its commitment to gradually eliminate electricity subsidy and implement cost-reflective tariffs across Nigeria's power sector, while assuring that low-income and vulnerable households will receive targeted support to cushion the impact of the reforms.

The assurance was given by the Special Adviser to the President on Power Infrastructure, Sadiq Wanka, during the Asharami Square 3.0 event organised by Sahara Group in Lagos on Wednesday, July 22, 2026. The event, themed "Energising Africa's Future: Legacy, Impact, and Transformation," focused on sustainable energy development and the future of Africa's power sector, Punch reported.

Vulnerable households to receive support Wanka acknowledged that the transition to cost-reflective electricity pricing remains one of the most sensitive issues in Nigeria's power sector, particularly among investors and industry stakeholders.

He explained that the government had already begun the process through the introduction of cost-reflective tariffs for Band A customers but noted that extending the policy to other customer categories would only happen alongside measures to protect vulnerable consumers.

He said: “It’s official government policy that there would be a transition to cost-reflective tariffs across the board with protections for vulnerable households. So I believe that’s something that should happen probably in the next year or so.”

According to him, the transition is now an official government policy, with the proposed Power Consumer Assistance Fund expected to provide financial support to poorer households once the reforms are fully implemented.

He added that while the exact timeline remains uncertain, the government expects the nationwide rollout of cost-reflective tariffs, backed by consumer protection measures, to take place within the next year.

Nigeria needs up to $12bn yearly for power sector Wanka also stressed that Nigeria's electricity industry still trails many comparable emerging economies despite ongoing reforms.

He said the country currently attracts roughly $1 billion in annual investment across electricity generation, transmission and distribution, a figure he described as far below what is required to transform the sector.

According to his presentation, Nigeria will need between $9 billion and $12 billion in yearly investments through 2045 to achieve universal electricity access and meet growing industrial demand.

Power sector funding gap remains wide The presidential aide estimated that total investment requirements for Nigeria's electricity sector could reach about $121 billion over the next two decades.

He noted that increasing investment and accelerating reforms would be critical to improving power supply, expanding access to electricity and supporting the country's economic growth.

Meanwhile, Legit.ng reported earlier that Barth Nnaji, a former minister of power, alleged that fuel suppliers and generator sellers are sabotaging efforts to ensure that Nigerians have consistent access to power.

Source: Legit.ng