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According to data acquired on Sunday, the Federal Government paid N375.8 billion in energy subsidies between January and September of this year, while power users paid N782.6 billion in total for the good.

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According to the most recent data on power subsidies, which were received in Abuja from the Federal Government’s Nigerian Electricity Regulatory Commission, the government provided electricity subsidies in 2023 for the first, second, and third quarters.

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Additionally, it was learned that despite widespread blackouts in Nigeria, power distribution companies collected N782.6 billion during the nine-month period, while billing energy users a total of N1.06 trillion nationally.

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Regarding subsidy payments, it was noted that the Federal Government provided power subsidies of N36 billion in the first quarter of this year, N135.2 billion in the second, and N204.6 billion in the third. Since we are still in the fourth quarter of 2023, the figures for that quarter are not available.

In its recently published third-quarter 2023 report, the NERC provided an explanation for the subsidy, stating that it resulted from the lack of cost-reflective rates.

“The government undertakes to cover the resultant gap (between the cost-reflective and allowed tariff) in the form of tariff shortfall funding in the absence of cost-reflective tariffs,” it stated. The NBET (Nigerian Bulk Electricity Trading Company) invoices that need to be paid are applied using this funding.

On the payment of electricity bills, it was observed from the three quarterly reports of the power regulator, that consumers paid N247.09bn, N267.86bn and N267.61bn in the first, second and third quarters of 2023 respectively. This represents a total of N782.56bn. It was also observed that during the three quarters: first, second and third, the electricity bills from Discos to consumers were N349.55bn, 354.61bn and N359.38bn respectively. The total bill for the nine-month period was N1.06tn.

In its latest third quarter 2023 report, the NERC stated that “the total revenue collected by all Discos in 2023/Q3 was ₦267.61bn out of ₦349.55bn billed to customers. “This translates to a collection efficiency of 76.56 percent, which represents an increase of +1.02 basic points when compared to 2023/Q2 (75.54 percent). The increase in collection efficiency can be attributed to the implementation of various collection campaigns for improved remittance by post-paid customers.” On market remittance, it stated that “in 2023/Q3, the cumulative upstream invoice payable by Discos was ₦208.7bn, consisting of ₦167.4bn for generation costs from NBET and ₦41.3bn for transmission and administrative services by the Market Operator.

Regarding remittance by special and cross-border customers in 2023/Q3, the commission stated that none of the four international customers supplied by Nigeria’s power generation companies in the sector made any payment against the cumulative invoice of $11.16m issued to them by the MO for services rendered in 2023/Q3. Out of this amount, the Discos collectively remitted a total sum of ₦158.43bn (₦124.53bn for NBET and ₦33.9bn for MO), with an outstanding balance of ₦50.27bn. “This translates to a remittance performance of 75.91 percent in 2023/Q3”

In a similar vein, none of the 16 bilateral clients involved in the Nigeria Electricity Supply Industry (NESI) paid the N2,814.68 million cumulative invoice that the MO had sent them for services completed in 2023/Q3, according to the NERC.

The president of the Nigerian Electricity Consumers Association, Chijioke James, told The PUNCH that it was unclear whether the government was actually providing the electricity subsidies that were being claimed.

Additionally, he took issue with the government’s comparisons, which seemed to imply that Nigerians were paying less for energy than many of their peers.

“The subsidy that they claim the government is paying is unclear,” he remarked. The manner in which the government funds this subsidy is unclear. Everyone would be able to recognize and appreciate the government’s level of commitment if the process was open and transparent.”The subsidy that they claim the government is paying is unclear,” he remarked. The manner in which the government funds this subsidy is unclear. Everyone would be able to recognize and appreciate the government’s level of commitment if the process was open and transparent.

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