The Nigerian Bulk Electricity Trading (NBET) Plc has told the senate that only N60 million was released out of the N858 billion appropriated in the 2025 capital budget to bridge the electricity tariff shortfall.
Johnson Akinnawo, acting managing director of NBET, spoke on
Thursday during the agency’s 2025 budget performance review and defence of its
2026 proposal before the senate committee on finance chaired by Sani Musa,
Niger east senator.
Akinnawo said persistent underfunding and
non-cost-reflective tariffs continue to weaken Nigeria’s electricity market.
He noted that while N858 billion was appropriated to address
the tariff gap and outstanding obligations to generation companies (GenCos),
the release fell far short of expectations.
“Only N60 million was released,” Akinnawo said, adding that
the fund could not be utilised due to procurement process constraints.
“The gap between generation costs and allowed tariffs is
substantial, and without government intervention, the market cannot remain
stable,” he said.
Akinnawo warned that the non-release of the bulk of the
funds has worsened NBET’s debt exposure to GenCos.
NBET was established to purchase electricity from GenCos and
sell to distribution companies (DisCos), while guaranteeing payments to power
generation firms.
Lawmakers observed that inadequate capitalisation has
limited the agency’s ability to effectively discharge its stabilising role in
the electricity value chain.
Musa expressed concern over the widening financial strain in
the power sector and suggested that the committee might recommend a review of
the tariff regime or explore alternative funding mechanisms.
In response, Akinnawo acknowledged that insufficient
capitalisation remains a major challenge and said the management had engaged
the budget office and the ministry of finance over the non-release of
appropriated funds.
He said without adequate funding support, NBET’s capacity to
stabilise the electricity market would remain constrained, with implications
for power supply nationwide.
Musa advised NBET to submit a comprehensive proposal
detailing its funding requirements and strategic plan to address structural
challenges in the sector.
The committee is expected to review the submission as part
of its consideration of the 2026 budget proposal.
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