Power Subsidy Rises to ₦418bn as Sector Losses Pass ₦300bn 

While many homes and businesses battled unstable power in late 2025, the Federal Government spent ₦418.79bn to keep tariffs low, even as the sector lost more than ₦300bn through waste, weak billing systems, poor collections and technical failures.

Fresh figures from the Nigerian Electricity Regulatory Commission show a power industry still struggling with old problems despite years of reforms.

Government Paid More Than Half the Power Bill

During the fourth quarter of 2025, generation companies billed ₦804.93bn for electricity supplied into the grid.

But because tariffs charged to consumers are still below actual cost, the government had to cover 52.3 per cent of the bill through subsidy.

That means over ₦418bn in public funds was used in just three months to support the market.

Although this was slightly lower than the previous quarter, it still shows how deeply dependent the sector remains on government intervention.

Over ₦300bn Vanished Through Inefficiency

The bigger concern may be what the sector lost internally. Electricity supplied to distribution companies was worth ₦969.19bn, yet only ₦795.06bn was billed to customers. That created a billing gap of ₦174.12bn.

On top of that, technical losses, theft, unpaid bills and collection failures wiped out another ₦139.19bn.

Combined, the sector lost more than ₦300bn in one quarter. That is money that could have gone into better transformers, stronger transmission lines, prepaid meters or improved customer service.

Power Was Supplied, But Revenue Did Not Follow

DisCos received 7,991.22GWh of electricity, but customers were billed for only 6,614.57GWh.

This continues a familiar Nigerian problem: power enters the system, but the money does not fully return.

For investors, that raises risk. For consumers, it delays improvement.

DisCos Also Paid Less Into the Market

Distribution companies were expected to remit ₦471.66bn to market operators and power producers, but they paid ₦437.27bn, leaving ₦34.39bn unpaid.

Their remittance rate also dropped compared to the previous quarter.

That weakens the entire chain because when one side does not pay fully, others struggle too.

Generation Improved, But Grid Problems Remain

Average hourly generation rose by 6.55 per cent, with total electricity output reaching 9,831.58GWh.

But available generation capacity slipped slightly, and 17 power plants recorded reduced output.

Even worse, grid instability remained. Voltage and frequency moved outside safe levels, while Nigeria recorded another partial grid collapse on December 29.

The regulator said one reason subsidy dropped was increased supply to Band A customers, who pay higher tariffs and receive more hours of electricity.

Energy sent to Band A feeders rose from 40 per cent to 45 per cent.