Despite more than Power sector investments worth ₦10 trillion over the past 13 years, Nigeria’s electricity supply has remained largely stagnant, prompting the Federal Government to launch a fresh strategy aimed at overhauling the sector.
Minister of Power, Joseph Tegbe, acknowledged the industry’s long-standing structural challenges, saying the Tinubu administration has begun a comprehensive reset designed to improve electricity generation, transmission, distribution and market sustainability.
An analysis of public interventions since the 2013 privatisation of the electricity industry shows successive governments have committed enormous resources to stabilise the sector.
Major interventions include the Central Bank of Nigeria’s ₦213 billion Electricity Market Stabilisation Facility, the ₦701 billion Payment Assurance Guarantee for power generation companies, over ₦200 billion under the National Mass Metering Programme, the ₦700 billion Presidential Metering Initiative, the €2.3 billion Siemens Presidential Power Initiative, multilateral loans exceeding $2.4 billion and the recently introduced ₦4 trillion Presidential Power Sector Debt Reduction Programme.
However, average electricity generation has remained around 4,500 megawatts—far below Nigeria’s estimated demand of more than 30,000MW.
According to the Nigerian Electricity Regulatory Commission (NERC), average available generation capacity during the first quarter of 2026 stood at 4,457.96MW, while actual average hourly generation was 4,112.72MW, missing the Federal Government’s 6,000MW target.
Beyond inadequate generation, operators say the sector continues to struggle with severe financial challenges. The Association of Power Generation Companies (APGC) estimates that electricity subsidy-related debts have risen to about ₦6.2 trillion. While the Federal Government disputes the figure, Finance Minister Taiwo Oyedele said a verification exercise reduced confirmed liabilities to approximately ₦3.3 trillion.
APGC Executive Director, Dr. Joy Ogaji, challenged the government’s position, insisting generation companies were excluded from the reconciliation process and calling for full disclosure of how the revised figure was reached. Data from the Nigerian Bulk Electricity Trading Plc (NBET) also showed that between April 2025 and April 2026, subsidy invoices totalled ₦1.859 trillion, but only ₦76.95 billion was paid, leaving outstanding obligations of roughly ₦1.78 trillion.
To improve liquidity across the Nigerian Electricity Supply Industry (NESI), the Federal Government has intensified the Power sector investments programme through bond financing.
Authorities have already paid about ₦333 billion to electricity generation companies, while an additional ₦729 billion bond has been issued under the ₦4 trillion Presidential Power Sector Debt Reduction Programme. Officials believe the initiative will restore market confidence, improve liquidity and attract fresh private investment into the electricity industry.
Industry stakeholders argue that funding alone cannot solve the sector’s challenges. President of the Nigeria Consumer Protection Network, Kunle Olubiyo, blamed persistent inefficiencies on government involvement, saying public financing has encouraged leakages, inflated claims and poor operational efficiency.
He called for complete privatisation of the remaining government-owned assets, including the Transmission Company of Nigeria (TCN), while urging government to focus on regulation rather than operations.
Similarly, President of the Chartered Institute of Power Engineers of Nigeria (CIPEN), Engr. Israel Abraham, attributed the sector’s poor performance to inadequate technical leadership, arguing that competent professionals should be entrusted with managing critical electricity institutions.
Responding to the criticism, Tegbe said the Federal Government has begun implementing a comprehensive reform programme to reposition the industry. According to him, the strategy includes a nationwide technical audit of transmission infrastructure, harmonisation of federal and state electricity regulations, grid stabilisation projects, improved market liquidity, strategic asset optimisation and the rollout of a national Super Grid Programme.
The minister also highlighted the Presidential Metering Initiative, expanded rural electrification, transmission upgrades and the newly launched Power Force programme, which will train and deploy 5,000 young Nigerians for nationwide meter installation.
He disclosed that electricity generation has recently improved, with the national grid consistently producing about 5,000MW over the past two weeks. Tegbe expressed optimism that ongoing Power sector investments and reforms would deliver a stronger grid, lower technical losses, greater investor confidence, expanded electricity access and improved operational capacity within the next two to three years.
