The Federal Government has decided that state governments must now help pay for electricity subsidies in Nigeria.
Electricity subsidy means the government pays part of the electricity bill so people don’t pay too much money for power.
President Bola Tinubu said the Federal Government cannot keep paying this money alone. He wants states to help too, especially because electricity is used in every state.
A special fund called the Power Assistance Consumers Fund (PCAF) will be used to help poor and vulnerable people pay for electricity. Instead of helping everyone, the government will now focus on people who really need help.
A government official explained that when electricity prices are kept low, someone must pay the difference — and that difference is the subsidy.
He said that from 2026, the government wants everything to be clear and honest. States and the Federal Government must show how much they are paying and not hide unpaid bills.
More than 18 states, including Lagos, Delta, Anambra, Imo and others, already help regulate electricity in their areas. This is why the Federal Government says they should also help pay for subsidies.
The President also wants stricter rules on how government money is spent, so Nigeria does not waste money or borrow too much.
Some governors said they are still studying the decision and are not ready to talk about it yet.
Electricity experts say the government owes a lot of money, about ₦5 trillion, to companies that generate and supply power. They believe the Federal Government cannot continue paying alone.
However, some lawyers and experts say it is not clear if the Federal Government can force states to pay. They believe states should agree first or that the money may be taken from the funds states receive every month.
In simple terms, the government wants everyone to share the cost of electricity, so the power system does not collapse.
