Nigeria’s power sector faces a mounting crisis as the government reveals an alarming debt of about N3.3 trillion owed to electricity generating and gas companies.
Minister of Power, Adebayo Adelabu, expressed concern over the subsidy of N3 trillion projected for 2024, far exceeding the allocated budget of N450 billion. Adelabu emphasized the urgency of transitioning to a cost-effective tariff model, citing the unsustainable nature of current subsidies.
Addressing reporters in Abuja, Adelabu defended his position amid calls for resignation, affirming collaborative efforts across ministries to address the sector’s challenges.
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He highlighted the ripple effects of the debt, including January’s power crisis triggered by gas suppliers withholding supply due to outstanding payments.
Adelabu underscored the complexity of the crisis, citing factors such as inadequate gas supply, aging infrastructure, and insufficient investment hindering sectoral growth. He stressed the need for a national discourse on electricity’s role, urging consensus on defining its nature – whether a commercial commodity or a social service.
Proposing solutions, Adelabu advocated for debt settlement, tariff review, and increased investment in infrastructure and renewable energy. He called for a diversified generation strategy to ease pressure on the national grid and accelerate the transition to sustainable energy sources.
As Nigeria grapples with its power sector challenges, the government faces tough decisions regarding subsidy sustainability and long-term sectoral viability.
The looming threat of continued debt accumulation underscores the urgency for comprehensive reforms to ensure reliable and affordable electricity for all Nigerians.