Financial Energy Review
The Federal Government of Nigeria expended over ₦633.30 billion on electricity subsidies during the first quarter of 2024, according to recent findings.
The Nigerian Electricity Regulatory Commission’s quarterly report highlighted that this figure marks a 150.5 percent increase from the ₦252.76 billion spent in the last quarter of 2023.
The amount spent in the first quarter of 2024 also surpasses the total of ₦628.61 billion paid throughout the entire year of 2023.
A detailed breakdown of the ₦633.30 billion revealed the subsidy amounts for each quarter in 2023: ₦36.02 billion in Q1, ₦135.23 billion in Q2, ₦204.6 billion in Q3, and ₦252.76 billion in Q4.
The report attributed the surge in subsidy costs to the government’s policy of harmonizing exchange rates and the lack of cost-reflective tariffs across all electricity distribution companies (DisCos).
“It is important to note that due to the absence of cost-reflective tariffs across all DisCos, the Government incurred a subsidy obligation of ₦633.30 billion in 2024/Q1, an average of ₦211.10 billion per month,” the report stated.
Regarding revenue collection, the DisCos faced a shortfall, collecting ₦291.62 billion out of the ₦368.65 billion billed to customers during the period.
The total energy received by all DisCos was 7,171.93 GWh, while the energy billed to end-use customers amounted to 5,769.52 GWh, reflecting an overall billing efficiency of 80.45 percent.
Ikeja DisCo led in revenue collection with ₦57.88 billion, followed by Eko DisCo at ₦48.74 billion. Yola DisCo recorded the least revenue at ₦5.46 billion.
Other notable collections included Abuja DisCo with ₦48.60 billion, Ibadan DisCo with ₦30.35 billion, Benin DisCo with ₦22.46 billion, Enugu DisCo with ₦21.24 billion, and Port Harcourt DisCo with ₦20.39 billion. Additionally, Kano DisCo collected ₦13.62 billion, Jos DisCo collected ₦13.29 billion, and Kaduna DisCo collected ₦9.60 billion.
