Abuja, Aug. 15, 2025 – The federal government is to launch pay-as-you-go model of payment for electricity to eliminate subsidies and stop government’s indebtedness to power sector operators.
Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, disclosed this in Abuja on Thursday.
He said this would be part of the steps by government to tackle its debts and transit to a fully deregulated environment.
The minister said the transition to the new model would take effect after the government settles its outstanding N4 trillion debt to operators in the sector.
He stressed the need for a sustainable approach in managing electricity bills across the country.
“Going forward, we are focused on ensuring that collections increase while adopting a pay-as-you-go system that does not leave the government with a bill to pay,” he said.
The minister condemned the age-old power purchase agreements that had imposed financial burdens on the government.
“The goal is to replace these agreements with investments in power generation that do not require government guarantees for payment,” he said.
