The Federal Government has spent over ₦633.30 billion on electricity subsidies in the first quarter of 2024, representing a significant increase of 150.5% from the ₦252.76 billion recorded in the fourth quarter of 2023.
PLATFORM TIMES reports that this substantial rise, detailed in the Nigerian Electricity Regulatory Commission’s (NERC) quarterly report, also surpasses the total subsidy of ₦628.61 billion paid throughout the entire year of 2023.
A detailed breakdown of the subsidy payments reveals a progressive increase over the quarters of 2023, culminating in the large outlay seen at the start of 2024.
Specifically, the government spent ₦36.02 billion in the first quarter, ₦135.23 billion in the second quarter, ₦204.6 billion in the third quarter, and ₦252.76 billion in the fourth quarter of 2023.
The surge in subsidy payments has been attributed to the government’s policy of harmonising exchange rates and the lack of cost-reflective tariffs across all electricity distribution companies (DisCos).
The NERC report highlighted that the absence of cost-reflective tariffs led to a subsidy obligation averaging ₦211.10 billion per month in the first quarter of 2024.
In terms of revenue collection, the DisCos faced challenges, with total revenue collected amounting to ₦291.62 billion out of the ₦368.65 billion billed to customers.
This indicates a shortfall in revenue collection efforts. The total energy received by all DisCos was 7,171.93 GWh, while the energy billed to end-use customers stood at 5,769.52 GWh, reflecting an overall billing efficiency of 80.45%.
Among the DisCos, Ikeja DisCo led in revenue collection, amassing ₦57.88 billion, followed by Eko DisCo with ₦48.74 billion.
Yola DisCo collected the least revenue, totaling ₦5.46 billion. Other notable collections include Abuja DisCo at ₦48.60 billion, Ibadan DisCo at ₦30.35 billion, Benin DisCo at ₦22.46 billion, and Enugu DisCo at ₦21.24 billion. Port Harcourt DisCo collected ₦20.39 billion, while Kano DisCo, Jos DisCo, and Kaduna DisCo collected ₦13.62 billion, ₦13.29 billion, and ₦9.60 billion, respectively.
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