Minister of Power, Mr. Adebayo Adelabu, on Thursday, April 17, 2025, said the sector generated additional N700 billion revenue in 2024, reflecting a 70 per cent increase from what was collected in 2023.
Adelabu said this during the 6th Edition of the 2025 Ministerial Press Briefing Series in Abuja.
“It is evident that, due to our transformative tariff reforms, the electricity market generated additional N700 billion revenue in 2024, reflecting a 70 per cent increase as N1.7 trillion was generated in 2024 while one trillion naira generated in 2023.
“This resulted from the cost-reflective tariff adjustment for Band A customers. This growth in market revenue is unprecedented, as the highest growth previously achieved was 20 per cent.
“This positively impacts the reduction of the government-subsidised tariff shortfall by 35 per cent, decreasing it from N3 trillion to N1.9 trillion,’’ minister said.
According to him, the growth in revenue demonstrates that financial viability and service delivery can coexist harmoniously.
Adelabu also said that the commitment of President Bola Tinubu’s administration to energy access was further demonstrated when it signed the Nigerian Energy Compact in Tanzania in January.
According to him, the initiative which is led by the World Bank and the African Development Bank (AFDB) aligns with the administration’s aspiration to expand energy generation.
“The target of M300 is to extend energy access to an additional 300 million Africans by 2030 out of the 600 million currently lacking access.
“This initiative will be realised based on a five-pillar strategy: expanding generation, strengthening utilities, incentivising private investment, accelerating renewables, and boosting regional integration.
“The compact sets ambitious goals to enhance electricity access, increase renewable energy adoption, and improve clean cooking solutions for millions of Nigerians,” he said.
Adelabu further said that in fulfillment of the statutory mandate of the Electricity Act 2023, the Federal Government, through the Federal Ministry of Power, developed the National Integrated Electricity Policy (NIEP).
He said that the transformative framework in NIEP would set a clear roadmap for delivering a resilient, cost-effective, and sustainable power sector.
According to him, the NIEP, which was presented to the President had been submitted for approval by the Federal Executive Council of Nigeria.
“This policy guides all power sector actors, including investors, operators, regulators, and the supervising ministry, to transform the country’s power sector through a data-driven and evidence-based approach,” he said.
Adelabu disclosed that the Federal Government it plans to pay Power Generation Companies (GenCos) N2 trillion out of the N4 trillion debt owed them before the end of 2025.
Adelabu was reacting to an appeal by the GenCos urging the Federal Government and stakeholders in the power sector to settle the outstanding debts owed them for electricity generated.
“I can tell you that between now and the end of the year, we are going to pay close to two trillion Naira out of these four trillion Naira owed GenCos.
“These debts are primarily unpaid subsidies, almost half of it was inherited, while about half of came from 2024 operations
“There are plans underway to make these payments. I will not say it will be paid 100 per cent; we will be paying it gradually,” he said.
Adelabu said that the mode of payment would be in two ways, adding that there would be some budgetary provisions which will facilitate cash payments.
He said that government was also discussing with the GenCos to give them some guaranteed debt instruments like promissory notes.
“These promissory notes will be liquid enough for it to be taken to the banks for discounting if they need immediate cash injection.
“It is a combination of cash payments and promissory notes.
“I had discussions with the Minister of Finance and the Coordinating Minister for the Economy, who has promised that they are working on the promissory notes, and once we have budget releases, cash payments will also be made,” he said.
Adelabu also said the government had earmarked N25 billion in the 2025 budget to light up major highways in the country as part of national security efforts.
The minister said that beyond just supplying power to homes and businesses, lighting up highways was also part of the Federal Government’s strategy to improve security.
“I believe that this will continue in subsequent appropriation. We have noted it. I will ensure we start the process as soon as we start getting budget releases,” he said.
Speaking on subsidy, Adelabu said that government could not a keep funding subsidy after privatisation which keeps growing on an annual basis.
“As our consumption grows, government subsidy keeps growing. So we need to nip it in the bud.
“We are not saying stop subsidy completely. But subsidy in the past has always been favouring the higher echelon in our society because of huge consumption.
“We want to devise a subsidy strategy that will favour the poor so that it will be graduated, If you consume energy to a particular threshold, you will enjoy subsidy.
“Once it is going above a particular threshold, the tariff will go up, so that the poor will not be impacted negatively because of subsidy,” he said.
Adelabu also said the Nigerian Electricity Regulatory Commission (NERC) oversight function would remain strong in ensuring that Electricity Distribution Companies (DisCos) meet their service obligations.
The minister said that any DisCo charging Band A tariff but failing to provide 20 hours of electricity daily would be penalised.
“If it is discovered that any DisCo is collecting tariff but not supplying up to 20 hours, there are penalties.
“Recently eight DisCos were fined N628 million. The moment they are detected, they will be fined. Where you have feeders downgraded from Band A, they are not expected to charge Band A,” he said.
According to Adelabu, the Federal Government, through the Ministry of Power, is targeting the deployment of 1.1 million meters by the end of 2025.
He said that the ministry would also distribute two million meters annually in the next five years as the procurement process had started.
According to him, through the World Bank-funded Distribution Sector Recovery Programme (DISREP), over 3.2 million meters will be procured and installed alongside meter data management solutions for Electricity Distribution Companies (DisCos) optimisation.
“The first batch of 75,000 meters under the International Competitive Bid 1 (ICB1) arrived in April, with 200,000 more expected in May,” he said.
Adelabu said that under the renewable energy, rural electrification and energy transition, the country had continued to lead on renewable initiatives by powering sustainable development while bridging the energy access gap.
He said that in the first quarter of 2025, the Federal Government accelerated its transition to clean energy solutions while bringing electricity to underserved communities through innovative off-grid systems.
“These efforts align with our commitment to climate action, energy security and inclusive growth, ensuring that no Nigerian is left behind in our journey toward a sustainable energy future,” he said.
According to him, through the Rural Electrification Agency (REA) the Federal Government, under the Energising Education Programme (EEP), was designed to provide a reliable power supply to 37 Federal Universities and seven affiliated teaching hospitals across Nigeria.
Adelabu said that the EEP phases 1 and 2 implemented in collaboration with the World Bank had been successfully completed, adding that the EEP 3, implemented in collaboration with AFDB, is about 70 per cent completed.
He said that the projects would collectively add a total of 100 Megawatts (MW) of clean energy to electricity generated.
Adelabu said that another remarkable initiative of the power sector was the Distributed Access through Renewable Energy Scale-up (DARES) project, which is a 750 million dollars initiative funded by the World Bank.
“The project also aims to scale up Nigeria’s energy access gap by providing new or improved electricity supplies to more than 17.5 million Nigerians.
“This initiative aims to increase access to electricity services for households and small and medium businesses with private sector-led distributed renewable energy generation and encourage Productive Use of Energy (PUE).
“The proposed project is a part of the World Bank’s comprehensive, programmatic engagement in Nigeria’s power sector to help the Federal Government realise its ambitious Energy Transition Plan (ETP) vision,” he said.
The minister said that through the Africa Mini-grid Programme, the Federal Government had secured $5.91 million in grants for 23 projects.
He said that the Federal Government had also signed an agreement with Oando Clean Energy for a 1.2 gigawatt solar plant with panel recycling capabilities.
He said that the signing of the agreement was to ensure that the country does not just consume solar technology but participates in its full life cycle.
By Constance Athekame