Expert Warns of Inequality Risks in Nigerian Electricity Subsidy Removal Plan

An expert has cautioned against the Nigerian government's plan to remove electricity subsidies, which involves deducting N1.8 trillion annually from the federal account between 2026 and 2028. This move aims to reduce the subsidy burden on the federal government, which has accumulated N6 trillion in unpaid electricity subsidies.

The expert highlighted the potential for inequality among states, citing examples like Lagos State, which accounts for 40% of energy consumption, and Taraba State, with minimal grid access. The expert criticized the blanket deduction approach, emphasizing the need for a more nuanced strategy to address the disparities in energy consumption and grid connectivity.

The Nigerian Bulk Electricity Trade (NBET) plays a crucial role in managing the market shortfalls and subsidy payments in the power sector.