FG incurs ₦633bn electricity subsidy in Q1 2024

The Federal Government paid over ₦633.30bn on electricity subsidy in the first quarter of 2024, findings have shown.

According to the Nigerian Electricity Regulatory Commission quarterly report, the sum represented a 150.5 per cent increase from ₦252.76 billion in Q4, 2023.

The sum paid in the first three months of the year is higher than ₦628.61bn paid from January to December 2023.

A breakdown of the ₦633.30bn showed that subsidy gulped ₦36.02bn in the first quarter, ₦135.23bn in the second quarter, ₦204.6bn in the third quarter and ₦252.76bn in the fourth quarter of 2023.

The electricity market regulator blamed the increase on the government’s policy to harmonise exchange rates, as well as the absence of cost-reflective tariffs across all electricity distribution companies.

“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.”

On revenue collection, the report said the DisCos recorded a shortfall, as the total revenue in the period was ₦291.62bn out of ₦368.65bn billed to customers.

Also, the total energy received by all DisCos was 7,171.93GWh while the energy billed to end-use customers was 5,769.52GWh, translating into an overall billing efficiency of 80.45 per cent.

Ikeja DisCo collected the highest revenue (₦57.88bn) in the period, followed by Eko DisCo at ₦48.74bn. While Yola DisCo collected the least revenue at ₦5.46bn.

Also, of the total revenue collected in the period, Abuja DisCo collected ₦48.60bn, Ibadan DisCo collected ₦30.35bn, Benin DisCo collected ₦22.46bn, Enugu DisCo collected ₦21.24bn, Port Harcourt DisCo collected ₦20.39bn.

Others include: Kano DisCo at ₦13.62bn, Jos DisCo collected ₦13.29bn, Kaduna DisCo collected ₦9.60bn.

Source: Channels