Stakeholders at the just-concluded 6th National Council on Power (NACOP) have adopted a cost-reflective tariff regime. The council’s communique, issued by the Federal Ministry of Power, reveals a unified stance among federal, state, and private sector actors on the urgent need to reform electricity pricing—an action that could save the country over N200 billion monthly.
Held in Maiduguri, Borno State, the high-level summit was attended by over 400 delegates from across Nigeria’s energy value chain. The council reaffirmed its position as the apex decision-making body in the power sector by endorsing tariff reforms that balance financial sustainability with social responsibility.
According to the communiqué, the council concluded that “electricity must be paid for at a cost-reflective rate, while subsidies must still exist for the vulnerable but must be targeted and well-administered at a manageable and sustainable level.”
Minister of Power, Adebayo Adelabu, who presided over the council, has consistently warned that the N200bn monthly subsidy for electricity is not financially viable. He reiterated that only Band A customers currently pay the actual cost of power, a situation he described as inequitable and fiscally dangerous.
“The status quo is no longer sustainable,” Adelabu said, pointing to the distortion in the market and the inability of power generation and distribution companies to recover costs and invest in infrastructure.
He also stressed the need for band-based tariff adjustments, which will ensure wealthier or higher-usage consumers pay closer to actual costs, while subsidy interventions are redirected to the most vulnerable segments of the population.
In its broader reform agenda, the council adopted a policy that mandates apportioning market liabilities to all participants—generation companies (GenCos), distribution companies (DisCos), and regulatory agencies—subject to engagements to clarify asset-liability responsibilities.
The Nigerian Electricity Management Services Agency (NEMSA) was directed to work closely with the Nigerian Electricity Regulatory Commission (NERC) and the Power Ministry to push for increased capital expenditure. This includes ensuring DisCos recapitalise in order to address infrastructure challenges at key grid interfaces and improve supply reliability.
The council also encouraged sub-national governments to develop embedded generation networks and collaborate with federal agencies like the Rural Electrification Agency (REA) for solar mini-grid deployment, especially in underserved regions like Borno State.
The Nigerian Bulk Electricity Trading Company (NBET) was tasked with re-engaging stakeholders at the sub-national level to realign its operational framework. This is part of a wider strategy to transform the electricity market and improve efficiency through structural reforms and innovation.
Further aligning with the federal government’s energy diversification plan, the council acknowledged a request by the Ministry of Petroleum Resources (Gas) for a new Renewable Energy Initiative. However, it noted that an existing renewable energy and energy efficiency policy, driven by the Power Ministry, should guide all future collaborations. Agencies including the Ministry of Environment and the National Council on Climate Change are to be looped into inter-agency task forces to ensure policy coherence.
Given the peculiar energy challenges in the North-East, the council adopted the recommendation to construct additional double-circuit 330/132kV transmission lines to reinforce the region’s grid.
On security, stakeholders were reminded of the pressing need to develop multi-agency approaches to protect critical electricity infrastructure from vandalism and insurgent threats. This came in response to renewed calls to fast-track the Mambilla Hydropower Project—currently stalled due to legal issues.
The council’s resolutions mark a significant turning point in Nigeria’s electricity policy. By backing cost-reflective tariffs while maintaining targeted subsidies, the government aims to address financial imbalances in the sector, boost investor confidence, and improve long-term power supply stability.
If successfully implemented, these reforms could spell an end to chronic underinvestment and pave the way for a more resilient, efficient, and equitable energy sector.