The World Bank has thrown its weight behind Nigeria’s electricity tariff and subsidy reforms, saying the changes are necessary to restore financial stability and improve power supply across the country. The support is contained in the World Bank Group’s Country Partnership Framework for Nigeria covering 2026 to 2032, with the institution targeting better electricity access and reliability for households and businesses.
Nigeria’s power sector has continued to face serious financial and operational challenges, with millions of Nigerians still struggling with unreliable electricity supply. The World Bank said more than 86 million people currently lack access to electricity, describing Nigeria as having the world’s largest electricity access deficit. Frequent outages have also pushed households and businesses to depend heavily on generators, increasing operating costs and hurting productivity.
At the heart of the World Bank’s plan are reforms to the electricity tariff and subsidy frameworks, alongside stronger regulation and more competitive investment planning. The bank said the financial position of Nigeria’s electricity sector remained unsustainable, with tariff shortfalls estimated at $2.45bn by the end of 2025. For years, government intervention has kept electricity tariffs below the actual cost of supply, leaving a gap that has contributed to the sector’s liquidity problems.
Beyond tariff reforms, the World Bank plans to help attract more private capital into Nigeria’s electricity market, particularly in renewable energy, mini-grids and standalone solar systems. It will also support public-private partnerships across generation, transmission and distribution through project preparation, transaction structuring and transparent competitive processes. The institution said these combined efforts could provide electricity access to more than 32 million Nigerians.
The World Bank’s intervention comes as the Federal Government and industry regulators continue efforts to rebuild the financial health of the power sector and improve electricity supply. While tariff and subsidy reforms could help create a more sustainable electricity market, the success of the programme will ultimately depend on how effectively the reforms are implemented and whether consumers see a corresponding improvement in power supply. Power Minister Joseph Tegbe has also said the sector’s liquidity challenges will be addressed next year.
source: punch
