The Federal Government (FG) has announced that Nigerians should expect an increase in electricity tariffs in the coming months as part of efforts to improve the country’s power sector.
President Bola Tinubu’s Special Adviser on Energy, Olu Verheijen, disclosed this in an interview in Dar es Salaam, Tanzania, during a World Bank-backed conference where Nigeria presented a $32 billion electricity expansion plan to boost power connections by 2030.
The plan is expected to attract$15.5 billion from private investors, while the remaining funds will come from public sources, including the World Bank and the African Development Bank.
Verheijen explained that Nigeria’s electricity tariffs need to increase by approximately two-thirds for many consumers to reflect the actual cost of power supply.

She emphasised that higher tariffs, along with subsidies for low-income households, are crucial for maintaining infrastructure, improving power reliability, and attracting private investment in generation and transmission.
“One of the key challenges we aim to resolve in the next few months is transitioning to a cost-efficient but cost-reflective tariff,” she stated.
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According to her, this adjustment is necessary for the power sector to generate enough revenue to attract private capital while ensuring that poor and vulnerable Nigerians are protected.
The proposed tariff increase comes amid growing concerns from debt-laden electricity distribution companies, which have long argued that government-regulated electricity prices do not reflect actual supply costs.
Nigeria privatized its power generation and distribution in 2013, but tariffs set by the Nigeria Electricity Regulatory Commission (NERC) remain below the cost of supply, forcing the government to subsidize the shortfall.
Despite these subsidies, achieving profitability remains a challenge for operators.
Verheijen noted that Nigeria’s power sector requires significant investment to meet its energy goals.
Of the 14 gigawatts of installed power capacity, only 8 gigawatts can be transmitted nationwide, and just 4 to 5 gigawatts are effectively delivered to homes and businesses.
The government is currently working with Siemens AG on a $2.3 billion project aimed at improving power transmission and distribution infrastructure.
Additionally, more than 7 million Nigerians in rural areas have gained access to electricity through decentralized renewable energy projects
Verheijen highlighted the importance of aligning energy policies with Nigeria’s economic ambitions.
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“Our goal is to become a $1 trillion economy in five years and transition to an upper-middle-income country within 25 years,” she said.
Currently, Nigeria’s Gross Domestic Product (GDP) stands at just under $200 billion, according to the International Monetary Fund (IMF).