By:Ecofinagency

Nigeria's Minister of Power, Adebayo Adelabu, announced that the country is relying on tariff adjustments to address daily electricity outages. A key element of this strategy is the planned installation of seven million smart meters nationwide. This initiative aims to eliminate estimated billing and improve revenue collection across the power sector. The announcement was confirmed on Sunday, June 1, by Olu Verheijen, Energy Special Advisor to President Bola Tinubu.

Verheijen stated that the effort is part of a broader structural reform of the energy sector, with a focus on strengthening the financial stability of the power value chain—especially electricity generation from natural gas.

"We are working to enhance revenue guarantees by ensuring that most grid customers are equipped with meters," Verheijen said. "With this, we can end estimated billing and minimize recoupment losses so that power supply comes with effective payment."

The government is also working to settle debts to electricity producers and gas suppliers, estimated at 3.3 trillion naira ($2.6 billion). These debts, partly tied to public electricity subsidies, will be cleared using a combination of cash and credit notes. Authorities plan to phase out subsidies for the 15% of customers who account for 40% of national electricity consumption.

In exchange, all stakeholders in the power sector are expected to meet performance benchmarks. Recently, several distribution companies were sanctioned by the Nigerian Electricity Regulatory Commission (NERC) for exceeding billing limits, reflecting increased regulatory enforcement.