The World Bank Group will support reforms to Nigeria's electricity tariff and subsidy frameworks as part of a push to restore financial sustainability in the power sector. According to the World Bank's Country Partnership Framework for the Federal Republic of Nigeria covering FY26-FY32, the intervention targets both on-grid and off-grid access improvements for households and businesses.
"The WBG will also support reforms to restore financial sustainability, focusing on tariff and subsidy frameworks, competitive investment planning, and sound sector regulation," the document stated. The framework ties this support directly to Nigeria's Mission 300 Compact targets, a continent-wide electrification push led jointly by the World Bank and the African Development Bank.
The Bank said Nigeria currently holds the world's largest electricity access deficit, with more than 86 million people lacking power, a scale consistent with the Bank's own global tracking data. Frequent outages have pushed households and businesses toward costly generators, a pattern the document says has weighed on firm productivity nationwide.
The financial position of the sector remains unsustainable, with tariff shortfalls estimated at $2.45 billion by the end of 2025. For years the Federal Government froze tariffs, letting consumers pay less than actual consumption costs, and the failure to cover the resulting shortfalls as promised has driven much of the sector's liquidity crisis.
The World Bank said its support would help mobilize private capital for renewable energy expansion and grid densification, aiming to widen both affordability and access. It also confirmed continued backing for the Nigeria Distributed Access through Renewable Energy Scale-up platform, intended to catalyze private investment in mini-grids and standalone solar systems.
"Together, these off- and on-grid efforts under the CPF will provide electricity access to over 32 million Nigerians," the document stated. The Bank said it would help the Federal Government structure public-private partnerships across generation, transmission and distribution, including project preparation and transparent competitive investment processes.
The six-year framework arrives as the government and sector regulators work through the financial strain that has hobbled electricity supply for years. According to Minister of Power Joseph Tegbe, the liquidity challenges facing the sector would be addressed next year, though the CPF document does not specify how that timeline intersects with the Bank's own reform targets.
