Every Nigerian knows that we have an electricity problem. It has been a
recurrent sound bite in development discourse in Nigeria post- independence.
This challenge is generational and has defied all attempts in the past to solve
it. And Nigerians are gleefully looking to the incoming administration to end
the search for the solution to this hydra-headed problem and terminate
Nigeria’s electricity conundrum. Whether this administration will succeed
where others have failed in unravelling the electricity conundrum depends on
its careful study and understanding of the problem. It will entail an in-depth
review of all previous initiatives to solve the problem, and the current state of
the whole electricity value-chain in Nigeria as well as providing bespoke
strategies to provide sustainable electricity supply that meets the massive
demand in Nigeria. Electricity, especially in Africa, connotes light, which
signifies progress, knowledge, and awareness. Therefore, literarily, the
absence of light is darkness; metaphorically, the lack of electricity connotes
the dominance of darkness, which Africans associate with everything negative
– witchcraft, poverty, stagnation, and even death. Little wonder the availability
of electricity, or lack thereof, is significant to Nigerians.
However, several studies have empirically proved that a lack of electricity
correlates with poor human development indices. And on the flip side, access
to reliable power can dramatically unlock higher quality of life. Three pertinent
questions merit consideration: what is the current state of our electricity
challenge ? What are some of the negative consequences of Nigeria’s
electricity conundrum? And what solutions can the new administration pursue
to solve the problem? Answers to these questions, though limited in detail and
a rather snapshot of the current realities, provide a clear picture of the way
forward for Nigeria and a bird’s eye view of the electricity ecosystem in
Nigeria.
The current state of electricity generation, transmission and distribution in
Nigeria is a study in crisis. This crisis has become endemic and defied logic
and common sense. First, Nigeria’s installed electricity generation capacity is
said to be about 13,000 MW. However, actual generation capacity delivered to
the national grid for transmission to Nigerians has during the past 8 years
stagnated at an average 4100MW – 4200MW daily, even though during the
past 2 years there has been a marginal improvement in energy quantities
delivered to the grid reaching 4,753MW on February 2023. The consistent
inability to deliver much beyond 33% of total installed generation capacity is a
function of fairly long- standing market, infrastructure and regulatory
challenges. This is for a population of over 200 million. Egypt’s installed
electricity generation capacity was approximately 58,000 MW, making it one of
the highest in Africa, with 100% access, for a population of about 80 million
people. As of 2021, the installed electricity generation capacity in South Africa
was approximately 58,000 MW, with 84.4% access for a population of about
60 million people. These two countries, with a similar economic size to
Nigeria, produce and distribute about 15 times more MW than Nigeria, whose
population is almost three times more.
Second, Nigeria’s electricity distribution infrastructure needs to be updated
and requires substantial investment. Transmission and distribution losses are
high, resulting in a significant waste of generated electricity. Frequent system
failures, such as blackouts and voltage fluctuations, are common due to
inadequate infrastructure. Third, the regulatory framework for the Nigerian
electricity sector has faced criticism for needing to be more effective and
conducive to attracting investments. Inconsistent policies, bureaucratic
hurdles, and difficulties enforcing regulations have hindered progress in the
power sector. Fourth, electricity theft and non-payment of bills pose significant
financial challenges for power distribution companies in Nigeria, affecting their
ability to invest in infrastructure improvements and sustain operations
effectively.
Fifth, lack of a systematic, integrated approach to investment in the sector and
a need for sufficient diversification among gas, solar, wind, nuclear, and hydro
sources. And finally, inadequate planning in anticipation of demographics,
domestic and industrial power needs, and sabotage of public power supply to
favour the generator lobby. These factors compound our electricity conundrum
and render most efforts in improving electricity ineffective.
The consequences of this electricity quagmire are dire. Nigeria’s failure to
actualise its full potential is partially attributed to this electricity conundrum.
Studies have shown how the lack of reliable, affordable, and quality electricity
has systematically underdeveloped our country in the past 30 years. And I will
point out a few ways lack of electricity has stagnated our development or
underdeveloped us.
The first is that it impaired economic productivity. Electricity is a fundamental
requirement for industrial and commercial activities. Without reliable power,
businesses face operational difficulties, reducing productivity and
competitiveness. Lack of electricity also limits the establishment and growth of
new industries, hindering job creation and economic growth. As a result, the
country’s inadequate power supply has induced low economic development
and a high unemployment rate. The Africa Industrial Index Report and World
Bank data show Nigeria has had a low industrial growth rate over the past two
decades.
The second is that it significantly limited access to essential services.
Electricity is a fundamental aspect of modern life and vital in providing critical
services such as healthcare, education, food security and clean water supply.
Without electricity, healthcare facilities struggle to operate medical equipment,
schools face challenges in delivering quality education, and communities may
lack access to safe drinking water. This limited access to essential services
hampers human development and perpetuates the country’s poverty cycle.
This partially explains why our poverty rate is one of the highest globally.
The third is that it creates social and political tensions. The lack of reliable
electricity can exacerbate political instability, particularly in fragile or conflict-
affected states, and it can limit the government’s ability to provide essential
services and create a sense of angst and frustration among electricity
consumers. This has led to social unrest, political instability, and sometimes
violence in the country.
The fourth is the environmental consequences. The reliance on fossil fuel-
based generators as an alternative power source contributes to increased
carbon emissions, air pollution, and ecological degradation. Inadequate
electricity infrastructure impedes the development and adoption of renewable
energy sources, slowing the transition to a more sustainable and low-carbon
energy system.
The final impact is on security. Power outages and unreliable electricity supply
have security implications. In urban areas, the absence of street lighting
during blackouts can increase crime rates and compromise public safety. It
can also negatively impact the operations of security systems, such as
surveillance cameras and alarm systems, affecting overall security measures.
We appreciate this electricity challenge and how it has played a crucial role in
our stagnated development, and we keep trying to fix it. However, we have
been making cyclic movements – “motions without movement” in the same
spot. The government created NEPA, embarked on massive electricity power
sector reforms in 2005, started Nigeria Bulk Electricity Trading Company in
2010, privatised Distribution Companies in 2013 and Generation Companies
in 2014. Yet the challenge remains. Progress has been marginal. Power
generation on the grid rose from a meagre 3,183 MW in 2013 to 4,753.9 MW
in 2023. With about a sixth of our population, even Ghana has a dependable
electric power generation of 4,710 MW, with the access of 85.9% against our
57%.
How can the incoming administration rescue Nigeria from this intractable and
malignant malady of electricity poverty?
The new administration must understand the four-fold snags the electricity
industry faces: an exponential increase in the demand for electricity due to a
rapidly increasing population without commensurate investment in the
supplyend; pervasive insecurity threats to power installations and gas
infrastructure given that about 80% of grid-tied generation are gas fired; high
electricity transmission and distribution losses; over-reliance on generators
which last year cost more than $5.2billion for importing and running
generators; and liquidity challenges faced by distribution companies due to
low collection efficiency and theft.
This understanding must lead them to declare a state of emergency on
electricity. We can only imagine the multiplier effect of the government getting
electricity right on our way of life. Nigerians over the generations have yet to
experience sufficient electricity. The culture shock most Nigerians have when
they go abroad is experiencing a constant electricity supply, and it takes a
while to get used to it. This government must take Nigeria out of this “self-
inflicted” electricity conundrum and put us on the road to sustainable electricity
sufficiency.
I will suggest a cocktail of options available to the government. The
government must create the right policy environment and framework for
increased private investment in power generation, leading to the
modernisation of transmission infrastructure and management. It must work
towards greater diversification of energy sources, emphasising renewable and
clean energy sources. It is time the government considered nuclear energy as
an option. If South Africa , Iran and Turkey can build nuclear power plants , we
have no excuse not to. Government must review existing distribution
concessions with greater due diligence on the financial health of distribution
companies. It must implement a steep upward review of tariffs on generator
imports after a given period of grace to discourage generator dependency,
and the government must do this simultaneously with improvement in power
supply. The government must upgrade and modernise the national grid to
make it more flexible and compliant with current global trends. State
Governments , with the new constitutional provisions must play a critical role
in our drive towards power sufficiency .
I am unconvinced that Nigeria is doing enough to fix this intractable electricity
challenge that has held our development down from pre- independence. It’s
from one tell-tale to another. Like a new chapter, the beginning of a new
administration is not a time to blame past governments, the private sector,
contractors, or consumers for our serial failure to fix power. It is time to
assemble our best hands wherever they may be, be single-minded and drive
the optimisation of electricity as a national project to unlock our true potential.
The leadership of our country must show real commitment and strong will to
improve the generation, transmission, and distribution of electricity. Nigerians
expect nothing less. Failure is not an option—Nigeria’s economic, social, and
political future hinges on solving our electricity conundrum .
