The World Bank Group has expressed its readiness to support Nigeria’s efforts to reform electricity tariffs and subsidy arrangements as part of measures to improve the financial health of the power sector.

The commitment was contained in the World Bank’s Country Partnership Framework for Nigeria, covering the 2026 to 2032 financial years.

Under the framework, the development institution plans to support initiatives aimed at expanding electricity access and improving the reliability of power supplied to homes and businesses.

The programme will cover both grid-connected and off-grid electricity solutions and is aligned with the objectives of Nigeria’s Mission 300 Compact.

The World Bank said its assistance would also target changes to tariff and subsidy structures, investment planning and regulatory systems in order to create a more financially sustainable electricity market.

Focus on Private Investment

The bank is also expected to assist Nigeria in creating stronger frameworks for public-private partnerships and private investment across electricity generation, transmission and distribution.

Such assistance will include helping with project preparation, structuring transactions and establishing transparent competitive processes capable of attracting investors into the sector.

The World Bank’s proposed interventions are expected to complement ongoing efforts by the Federal Government and industry regulators to address longstanding financial and operational challenges within Nigeria’s electricity market.

Nigeria’s Electricity Access Challenge

Nigeria continues to face a significant electricity access gap. The World Bank estimates that more than 86 million Nigerians currently lack access to electricity, placing the country among those with the largest electricity deficits globally.

Poor reliability of supply has also increased the dependence of households and businesses on private generators, adding substantially to operating costs and affecting productivity.

The World Bank said improving electricity access and reliability would therefore be critical to supporting economic activity and improving living standards.

Tariff and Subsidy Changes

The planned reforms come against the backdrop of long-running concerns over electricity subsidies and the financial sustainability of the power market.

For years, electricity tariffs were kept below the actual cost of supplying power, leaving a gap between the amount paid by consumers and the cost incurred by service providers.

The resulting financial shortfalls have contributed to liquidity problems across the electricity value chain.

The World Bank’s support is expected to help address these challenges by promoting reforms that make the sector more financially sustainable while encouraging greater private-sector participation.

The six-year partnership framework is also expected to support Nigeria’s broader efforts to expand electricity connections through a combination of conventional grid infrastructure and decentralised renewable-energy solutions.

The World Bank said the combined on-grid and off-grid interventions under the framework could provide electricity access to more than 32 million Nigerians.

The initiative forms part of the wider Mission 300 agenda, which seeks to accelerate electricity access across Africa and support economic development through improved energy infrastructure.