The Nigerian Electricity Regulatory Commission (NERC) has taken a major step to improve electricity supply in the country by setting up a Transmission Infrastructure Fund (TIF). This new initiative is part of the May 2025 Multi-Year Tariff Order (MYTO), and it aims to fix the many issues affecting Nigeria’s power transmission network. The fund will be built through a N2.17 per kilowatt-hour (kWh) charge on electricity consumed by customers across the country.
Even though this new charge has been added, electricity tariffs will remain the same for all customer bands throughout May 2025. Customers in Band A will continue to pay N209.5 per kWh, while Bands B, C, D, and E will keep the same frozen rates they’ve had since December 2022. This move is in line with the Federal Government’s earlier decision to freeze electricity tariffs as seen in the MYTO 2024. Back then, it was agreed that the government would cover the gap between the actual cost of power and what customers are allowed to pay through subsidies. However, the latest MYTO hints that consumers may start paying full cost-reflective tariffs from later in 2025, depending on new government directions.
The Transmission Infrastructure Fund is meant to support key transmission projects across Nigeria’s electricity grid. It will also help fund new and innovative ideas that can make power delivery more reliable. According to NERC, the fund will be centrally managed to ensure transparency and accountability. It could also be used to attract vendor financing and other Public-Private Partnership (PPP) options to help bridge gaps in the electricity transmission network.
Executive Director of PowerUp Nigeria, Mr. Adetayo Adegbemle, spoke about the fund and said it wouldn’t cause an increase in electricity bills for consumers. He compared the TIF to the earlier Meter Acquisition Fund that was added to the MYTO without raising tariffs. “The N2.17 is a market contribution,” he said. “It’s like the contributory pension scheme where money is pooled together for a specific purpose.”
Adegbemle added that the success of the TIF will not depend on the money alone, but on how well it is managed. “If implemented properly, this fund will go a long way in improving Nigeria’s transmission infrastructure. But if not managed well, it could end up like many other initiatives that failed due to poor administration,” he said.
While the idea of a transmission fund has been welcomed, there are concerns from energy experts and stakeholders about how the fund will be used. Many believe that unless the money is invested in the right projects, the problems in the sector will remain. They stressed that transparency and regular monitoring of the fund’s usage are essential.
In the bigger picture, the Federal Government continues to spend heavily on electricity subsidies. Figures from December 2024 show that the government’s subsidy rose by 2.76%, hitting N199.64 billion in just one month. This was an increase from the N194.26 billion recorded in November 2024. These subsidies are used to balance the difference between how much it costs to produce electricity and what consumers actually pay. But some Nigerians believe the subsidy doesn’t make much sense if power supply remains poor. They are calling for improvements in service delivery along with financial support.
The creation of the Transmission Infrastructure Fund, alongside the continuation of subsidies, shows that the government is trying to address the deep-rooted issues in the power sector. The hope is that with proper implementation, Nigeria can finally begin to enjoy stable and efficient electricity. But time will tell if these efforts will make a lasting difference. Stakeholders will be watching closely to see whether this latest move will be a game-changer or just another policy that looks good on paper but fails in practice.
