In a startling revelation, the Federal Government of Nigeria declared that the country generates about 40,000 megawatts (MW) of electricity from generators powered by Premium Motor Spirit (petrol) and Automotive Gas Oil (diesel). This disclosure was made during the ministerial summit on Integrated National Electricity Policy and Strategic Implementation Plan, where key challenges to Nigeria’s electricity reliability were discussed.
Despite an estimated population of 200 million people, Nigeria’s power generation from its national grid hovers between 3,500MW and 4,500MW. Minister of Power, Adebayo Adelabu, highlighted that the objective of the Nigerian electricity sector reform initiated over 23 years ago was to provide efficient and consistent electricity to consumers across the country, a goal yet to be achieved.
Adelabu expressed concern over Nigeria’s deep electricity paradox, citing the country as hosting one of the world’s largest fleets of diesel- and petrol-powered generation capacity, totaling at least 40,000MW. He emphasized the economic implications of this inefficiency, with a daily cost in tens of billions of naira.
The minister advocated for a transformation in the ratio between backup electricity generation and on-grid supply in the near to mid-term. He proposed the restructuring of the Transmission Company of Nigeria into two entities: the Independent System Operator and the Transmission Service Provider. Adelabu also raised the question of whether the government should directly provide electricity nationwide or facilitate its provision, drawing comparisons with models in China and the US.
Adelabu urged stakeholders to collaborate and encouraged Pension Fund Administrators, holding over N17tn, to understand the Nigeria Electricity Supply Industry (NESI) and contribute capital. He emphasized the need for states, Local Government Areas, and Distribution Companies (Discos) to work together to invest in reinforcing and extending local distribution infrastructure while fostering competition and recognizing the vested interests of states in the Discos.
The power minister concluded by stressing that state-level policymaking and regulation should attract investment into domestic electricity markets for sustained growth and development.
