The Federal Government has unveiled plans to begin phasing out electricity subsidies from 2027 as part of a wider strategy to tackle the mounting financial obligations weighing down Nigeria’s power sector.

Minister of Power, Joseph Tegbe, disclosed the development during a media interaction on Friday, where he addressed growing concerns over the sector’s escalating debt profile and the sustainability of current government support.

While confirming the proposed subsidy withdrawal, Tegbe moved to allay public fears by stating that the government has no immediate intention of increasing electricity tariffs. According to him, Nigerians should not expect a tariff hike in the short term, despite ongoing efforts to reform the industry.

The minister explained that the planned phase-out of subsidies is designed to place the power sector on a more sustainable financial footing and reduce the burden of accumulated liabilities that have continued to challenge the industry.

He noted that the government is carefully developing the transition framework to ensure that consumers do not lose the benefits they currently enjoy under the subsidy arrangement. Tegbe emphasized that the objective is not to impose additional hardship on citizens but to create a more efficient and financially viable electricity market capable of attracting investment and improving service delivery.

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According to him, the reform forms a critical component of the Federal Government’s long-term agenda to strengthen the power sector, improve operational efficiency, and address structural financial challenges that have hindered growth and stability in the industry.

The planned withdrawal of subsidies from 2027 is expected to be implemented gradually, with authorities maintaining that measures will be put in place to protect consumers while ensuring the sector remains sustainable for future development.