FG signals higher electricity tariffs as subsidy costs move

From Isaac Anumihe, Abuja

President Bola Tinubu has directed Budget Office of the Federation to operationalise a clearer framework to share the cost of electricity subsidies across the federation so that the burden is not treated as an open-ended federal residual, adding that if electricity customers want a stable power they should be prepared to pay for it.

Speaking at the training of the staff of the Ministries Departments and Agencies (MDAs) on the 2026 post-budget preparation using Government Integrated Financial Management Information System, Director General, Budget Office, Tanimu Yakubu, said that if Nigerians want a stable power, they must be ready to pay for it.

“If we want a stable power sector, we must pay for the choices we make. When tariffs are held below cost, a gap is created. That gap is a subsidy. And a subsidy is a bill. In 2026, we will stop pretending that this bill can be left to the Federal Government alone—especially where the policy choice or the political benefit is shared across tiers of government. The president’s directive is to invoke the electricity-sector legal framework to make burden-sharing practical and transparent. This means, subsidy costs must be explicit, tracked, and funded—so they do not return as arrears, liquidity crises, or hidden liabilities in the market. It also means that if any tier of government chooses affordability interventions, the funding responsibilities must be clear, agreed, and enforceable. This is not punishment. It is alignment. When everyone carries a fair share of the cost, everyone also has an incentive to support cost-reflective efficiency, targeted protection for the vulnerable, and a power market that can actually deliver” the DG, stated.

Tanimu who was represented by the Director, Expenditure, Budget Office, Mr Yusuf Muhammed, told 2026 Budget planners to make subsidy-related costs visible in their planning and submissions, urging them not to push liabilities into the market as arrears or unfunded commitments.

“Support transparent, rules-based attribution and financing of affordability decisions” he charged.

Tanimu lamented that rollover budgeting and fragmented project lists have weakened execution.

According to him, such a policy reduces clarity, dilute accountability

and create hidden obligations.

“We must speak plainly. Rollover budgeting and fragmented project lists have weakened execution. They reduce clarity. They dilute accountability. They create hidden obligations.

“The 2026 Budget corrects this.

It is built as one coherent implementation framework.

In line with Mr. President’s directive, the approach is to consolidate commitments into a single, visible pipeline and manage them as a disciplined programme of delivery.

This is what I call the “single-train” approach” he said.