The indebtedness of Nigeria’s power sector to electricity generating companies and gas producers has risen to about N3.3tn, the Federal Government declared on Wednesday.
It also revealed that subsidy on electricity for 2024 would gulp about N3tn, whereas only N450bn was budgeted for this purpose in this year’s budget, adding that it was now very difficult to sustain power subsidy.
Minister of Power, Adebayo Adelabu, said Nigeria must begin to move towards a cost-effective tariff model, as he revealed that the country was currently indebted to the tune of N1.3tn to electricity generating companies, while the debt to gas companies was $1.3bn.
The minister, who spoke at a press conference in Abuja, which also had the heads of all the agencies under the Federal Ministry of Power in attendance, however, insisted that he would not resign his position as power minister following calls for his resignation by some persons.
Although he stated that the ministries of power, finance and petroleum were making efforts to tackle the crisis in the sector, Adelabu revealed that the electricity subsidy for January 2024 had not been paid yet by the Federal Government.
He also revealed that the crash in power generation and attendant poor supply in January was because gas suppliers stopped supplying gas for the generation of electricity due to the indebtedness of the sector to gas producers.
Buttressing the issue of subsidy, the minister stated that countries such as Ghana, Togo, Benin Republic pay much more than Nigeria for electricity, stressing that the government might not be able to continue funding subsidies.
