The Federal Government is seeking $15 billion in private investment to revive Nigeria’s struggling power sector, offering higher electricity tariffs while introducing fresh subsidies to cushion the impact on households.
The proposal was presented to investors at a World Bank energy summit in Tanzania, where Nigeria outlined its strategy to plug a $23 billion funding gap needed to fix its electricity infrastructure.
As part of the plan, the government will provide subsidized electricity for up to 50 kilowatt-hours per month to consumers, either through direct consumption or vouchers, ensuring that low-income households are shielded from immediate cost increases.
Despite Nigeria’s abundant gas reserves, hydro resources, and solar potential, the country generates only 13,000 megawatts of electricity for over 200 million people. By contrast, South Africa, with a population nearly a third of Nigeria’s size, has a capacity of 52,000 megawatts.
The government’s energy reform agenda includes raising the renewable energy share from 22% to 50% within five years and more than doubling the number of households connected to the grid annually.
The proposed tariff framework will reflect the full cost of electricity production by 2027, while maintaining a buffer for vulnerable households.
“Let us work together to create a brighter future for our citizens—where every African can access reliable and affordable energy. A future where our industries thrive, our economies grow, and our people prosper,” President Bola Tinubu said in a speech delivered by the Minister of Power, Adebayo Adelabu, at the summit.
Nigeria previously removed electricity subsidies for 15% of mostly urban households, leading to a threefold increase in tariffs. Despite this move, the government still spent an estimated N2.2 trillion on power subsidies last year.
The success of Nigeria’s investment drive will depend on regulatory stability, infrastructure development, and private sector participation, as the country aims to expand access to electricity for 86 million citizens currently without power.