In a detailed post shared on his X handle on Tuesday, Obi expressed concern over what he described as recurring financial approvals for the same liabilities without visible progress in electricity supply across the country.

“Let us reflect, sincerely and without sentiment,” he began, urging Nigerians to examine the pattern of policy decisions surrounding the power sector.

He noted that in recent days, the president reportedly approved N3.3 trillion as a “full and final” settlement for debts in the sector, pointing out that similar approvals had been made previously without clear evidence of resolution.

“On May 17, 2024, N3.3 trillion was approved for the same purpose. On July 25, 2024, another N4 trillion bond was approved to settle similar debts. There have also been other approvals in between, all targeted at addressing the same power sector liabilities,” he stated.

Obi questioned whether earlier approvals were effectively implemented, asking, “This raises a fundamental question: were the previous approvals mere announcements without execution?”

Highlighting the continued instability in electricity supply, he referenced campaign-era commitments made by the current administration.

According to him, the worsening state of power generation and distribution contradicts earlier assurances made to Nigerians.

“During the 2023 campaign, President Bola Ahmed Tinubu made a clear promise: that if he failed to deliver stable electricity, Nigerians should not re-elect him,” he said.

Obi added that the situation has deteriorated to the point where discussions have emerged about disconnecting the Presidential Villa from the national grid, describing it as indicative of broader systemic failure.

The Presidential Villa, also known as Aso Rock Presidential Villa, serves as the official residence and workplace of the Nigerian President.

He further argued that recurring policy announcements have not translated into measurable outcomes, stating that “each time legitimate concerns are raised, what we see appears more like policy pronouncements than measurable progress.”

The former Anambra State governor also raised concerns about accountability and transparency in the accumulation of power sector debts, noting that many of the liabilities were built up over successive administrations between 2015 and 2025.

“These debts were largely accumulated under successive administrations of the All Progressives Congress between 2015 and 2025. This raises serious concerns about accountability, transparency, and effectiveness in public financial management,” he said.

Obi questioned the rationale behind the persistent accumulation of obligations, particularly those owed by government institutions, including the Presidential Villa.

“It is important to note that government institutions and agencies, including the Presidential Villa, owe a significant portion of these debts. Year after year, budgets were made and funds appropriated. Why then were these obligations not settled when due?” he asked.

He also sought clarity on the funding structure of the latest approval, raising concerns about whether additional borrowing would be required.

“And from what source will this new payment be made? Are we resorting once more to borrowing to service inefficiencies?” he queried.

Obi further posed several unanswered questions regarding the power sector’s financial structure, including the total size of the debt, the origins of the liabilities, and the extent to which inefficiencies by operators may have contributed.

“Key questions remain unanswered: How did the debt accrue? What is the actual total debt in the power sector? Which components of the debts are due to operators’ inefficiency and should be borne by them? Why have previous approvals not translated into tangible improvements?” he asked.

He also queried whether the newly approved N3.3 trillion is separate from or related to earlier approvals, including the N3.3 trillion sanctioned in 2024 and the N4 trillion bond approved later that year.

“Is the N3.3 trillion approved on April 6, 2026, the same as the N3.3 trillion approved in May 2024, and how does it relate to the N4 trillion bond approved in July 2024?” he wrote.

Concluding his remarks, Obi urged a shift away from what he described as repetitive policy announcements toward meaningful reform of the electricity sector.

“Nigeria must move beyond recycled announcements and confront the power sector crisis with sincerity, transparency, and decisive reforms. Until we do so, we will remain trapped in a cycle of debt and darkness,” he stated.

It’s a recipe for backwardness. It is also a sad commentary on the failure of successive governments over a hundred years. No wonder the hum of progress is too often drowned out by the silence of power outages.

Today, homes flicker into darkness, businesses grind to a halt, and dreams of economic growth stall in the face of an unreliable electricity grid. The numbers paint a grim picture.

Nigeria generates a mere 6,000 megawatts (MW) of electricity against an estimated demand of 40,000 MW needed for a stable, nationwide supply.

The World Bank estimates this power deficit costs the economy $29 billion annually, an economic haemorrhage that highlights the urgency of reform. This may explain why Adebayo Adelabu, Nigeria’s Minister of Power, laid out a bold vision: a $200 billion investment over 20 years to deliver a 24/7 electricity supply.

This staggering figure, $10 billion a year, has sparked both hope and scepticism. Can Nigeria transform its beleaguered power sector, and what will it take to light up the nation?

Experts argue that Nigeria’s power crisis is a hydra-headed beast. The issues span generation, transmission, and distribution.

The national grid, a relic of decades-old infrastructure, is plagued by inefficiencies. Reports indicate that for every 100 MW generated, 7.79 MW is lost in transmission, a figure that reflects both technical shortcomings and systemic neglect. Vandalism compounds the problem. Indeed, between January 2022 and October 2024, the government spent ₦29.3 billion (roughly $17.7 million) repairing 266 vandalised electricity towers, an average of $66,500 per tower. These fixes however are mere Band-Aids on a system that demands a full overhaul.

The human toll is palpable. In Lagos, small businesses and homeowners alike are compelled to rely on costly petrol/diesel generators to keep their machines/households humming.

Many businesses spend more than half of their earnings on fuel. Across rural Nigeria, entire communities remain off the grid, their potential stifled by darkness; e.g. Otueke in Bayelsa state.

The metering gap, less than half of customers have metres, further complicates matters, leading to estimated billing and revenue losses for distribution companies and discontent from electricity consumers.

These challenges are not new, but the scale of the solution proposed is unprecedented.

The $200 billion goal is ambitious. It seeks to achieve a generation capacity of 88,000 MW, enough to ensure uninterrupted electricity nationwide by 2045.

This figure encompasses upgrades across the entire value chain, generation, transmission, and distribution.

It also accounts for the integration of renewable energy, grid modernisation, and policy reforms to attract private investment.

Breaking down the numbers, the plan allocates significant funds to each segment. Transmission infrastructure, for instance, requires a massive investment.

The Presidential Power Initiative, launched to modernise the grid, has already committed $1.9 million and €62.9 million in its first phase, boosting capacity by 2,000 MW.

Yet, industry experts estimate that $100 billion over 20 years is needed just to maintain current service levels, let alone expand them. Distribution upgrades, including metering initiatives, also demand substantial funding.

The Nigerian Electricity Transmission Access Project (NETAP), backed by a $486 million World Bank credit, is a step toward addressing these gaps, but it’s a drop in the bucket compared to the broader need.

So, while the government focuses on grid expansion, decentralised solutions like mini-grids and solar projects are gaining traction. In a country where vast rural areas remain unconnected, off-grid systems offer a lifeline.

Mini-grids, in particular, are emerging as a game-changer. In northern Nigeria, communities like Gbangba in Niger State have seen transformative change through solar-powered mini-grids. One shudders to imagine what the people used before the project.

The private sector’s role is critical. Of the $32.8 billion needed by 2030 for universal electricity access, the government plans to provide $17 billion, leaving $15.8 billion to come from private investors.

Embedded generation, small-scale power plants serving specific communities or industries, and renewable projects like solar and hydro are seen as cost-effective, but progress is slow.

Revenue shortfalls and bureaucratic red tape deter investors, leaving Nigeria’s power sector in a Catch-22: it needs funds to improve, but improvement is needed to attract funds.

The $200 billion estimate is a roadmap, but its success hinges on collaboration between government, private investors, and communities.

We can agree that the $200 billion price tag is daunting. But this is not just about money. Implementation efficiency, transparency, and anti-corruption measures are equally critical. Nigeria’s history of mismanaged projects looms large, with critics pointing to past initiatives that fizzled out despite hefty budgets. The truth is that the funds are one thing, but execution is another. Without accountability, $200 billion could vanish into thin air.

Short-term goals offer a glimmer of hope. Experts estimate that $15-30 billion by 2030 could stabilise the grid, expand metering, and deploy more mini-grids.

These steps wouldn’t deliver 24/7 power but could significantly reduce outages and connect millions more to electricity. For urban centres like Lagos and Abuja, grid upgrades could mean fewer blackouts. For rural areas, off-grid solutions could bridge the gap, promoting economic growth and improving quality of life.

The stakes are high. A reliable power supply could unlock Nigeria’s potential, fueling industries, creating jobs, and reducing poverty.

The World Bank’s $29 billion annual loss estimate underscores the cost of inaction. Yet, the path to transformation is fraught with challenges, technical, financial, and political.

As Nigeria grapples with its power crisis, the $200 billion question remains: Can the nation muster the resources and resolve to light up its future?

Eromosele, a corporate communication professional and public affairs analyst, wrote via elviseroms@gmail.com

As a sponsor and exhibitor at the event, Remita is spotlighting its robust payment infrastructure and demonstrating how businesses, fintechs, banks, aggregators, OEMs, and developers can seamlessly tap into a world of opportunity – through a single, intelligent connection.

With over 15,000 digital products and services accessible across more than 150 countries, Remita offers one of the continent’s most extensive payment and service ecosystems.

Participants at PayExpo will explore how Remita enables organisations to collect payments, resell high-demand services, and scale operations without the usual operational friction.

“Our presence at the Digital PayExpo is a deliberate move to show what’s possible for anyone who builds, distributes, or relies on digital services,” said ‘DeRemi Atanda, managing director, Remita Payment Services Limited. “We are here to enable businesses, fintechs, and institutions to connect, scale, and earn – without complexity. Our goal is simple: reduce friction, simplify integration, and multiply opportunity, while we manage the infrastructure that makes it sustainable.”

One of the core offerings Remita will be showcasing is its digital service infrastructure, which enables resellers to distribute products such as airtime, data, PayTV, electricity, airline tickets, movie tickets, eSIM, school fees, and other bill payments.

With 99.9% uptime powered by smart redundancy across multiple service providers, partners benefit from unmatched availability, instant top-ups, and real-time commission payouts.

Equally significant is Remita’s collection capability, which allows businesses and institutions to receive payments on behalf of government agencies, educational institutions, religious bodies, associations, and private enterprises.

This service is trusted by over 5,000 merchants, including all Federal MDAs, 36 state governments, and leading corporate institutions, offering full transparency, real-time reporting, and verifiable receipts.

Participants will also see firsthand how businesses and developers can quickly onboard, access functionalities, and begin testing integrations with minimal effort.

The Remita integration experience is designed to be fast, intuitive, and secure, supported by layered authentication, including IP whitelisting, encrypted tokens, and multi-channel verification for enterprise-grade protection. The platform is designed to be almost entirely self-service, giving users full control to build, test, and go live within 24 hours.

By participating in Digital PayExpo 2025, Remita reinforces its commitment to reducing integration complexity, expanding digital distribution, and powering financial inclusion across the continent. Attendees will engage directly with Remita experts at the booth, experience live demonstrations, and explore how to monetize digital services through a unified, performance-ready infrastructure.

As Africa moves toward a more interconnected digital future, Remita stands as a foundational infrastructure designed to power that journey.

It embodies Remita’s bold vision to empower everyone, everywhere, through innovative thinking and excellent technology, beginning in Nigeria, extending across Africa, and ultimately reaching the rest of the world.

Remita envisions a future where payments and digital transactions are seamless, accessible, and familiar, no matter the distance, scale, or service.

With this project, the company is laying the groundwork for a continent-wide transformation, offering developers, businesses, and institutions the tools to build resilient ecosystems that support ambition, growth, and shared prosperity.

In a statement released on Thursday, the company outlined its intention to expand into the electricity sector as part of a long-term roadmap.

Roger Brown, chief executive officer (CEO) of Seplat Energy, said the energy firm is focused on bolstering Nigeria’s energy sector by addressing the country’s power challenges.

He highlighted that this move follows Seplat’s recent acquisition of assets management from Mobil Producing Nigeria Unlimited (MPNU), which has doubled its reserves and expanded its footprint and diversified its portfolio across upstream and midstream sectors.

The acquisition led to the formation of Seplat Energy Producing Nigeria Limited, now overseeing offshore operations and two onshore terminals.

“This gives us a fully integrated value chain — from the wellhead to export via vessel — with Seplat in full control of operations. Our production has materially increased. We’ve moved from around 50,000 barrels per day to over 120,000 barrels per day. We are to say our workforce now includes around 1,500 professionals. The vast majority of whom are Nigerians.”

Brown also emphasised the potential of Nigeria’s abundant gas resources to address electricity issues, noting the company’s interest in deploying modular gas-to-power systems in rural areas.

“These will play a key role in solving last-mile electricity access problems.”

While Seplat has ambitions to expand into renewable energy and electricity generation, Brown noted that the company will, for now, maintain its focus on upstream oil and gas and midstream gas processing.

The deal, finalised with the International Finance Corporation (IFC) and Stanbic IBTC Bank, is the largest energy access facility ever arranged in local currency in West Africa.

This development is particularly important because the funds are denominated in naira, not dollars. In a market repeatedly battered by currency volatility, this matters. “What’s really exciting about this is that it’s a local-currency facility. It eliminates foreign-exchange risk and allows us to offer more affordable financing to our customers,” said Anish Thakkar, Sun King’s co-founder.

Sun King plans to use the funds to provide solar electricity systems to an additional four million households across Nigeria within the next five years. That would more than double its existing footprint, which currently covers two million homes.

The solar kits come with small panels and rechargeable batteries, and users pay around $0.21 (N320) daily over the course of a year. For many rural communities, it’s a significant yet manageable cost in exchange for the stability and dignity of having constant power. The hardware is designed to last up to a decade.

We can’t ignore the scale of Nigeria’s electricity problem. Around 90 million people in the country remain disconnected from the grid. That’s nearly half the population. Diesel generators and candlelight remain their fallback options.

This new loan is part of an international initiative to bridge Africa’s energy gap. It feeds into Mission 300, a joint initiative by the World Bank and African Development Bank that aims to connect 300 million people in sub-Saharan Africa to electricity by 2030.

The project expects both public and private investments to pour into scalable, cost-effective energy solutions.

In 2021, Sun King, previously known as Greenlight Planet, pulled off a similar $75 million deal in Kenya focused on off-grid energy expansion.

For Nigeria, international support for electrification continues to build. Last December, the World Bank helped arrange a separate $750 million loan targeting renewable and off-grid energy.

That deal is expected to unlock over $1 billion in private capital and deliver electricity to 17.5 million Nigerians.

In this country, we are bathed in 2,555 kWh/m² per year of solar radiation, but still bargain over fuelwood in 2025. The paradox of power supply is so absurd. 

As of 2023, Nigeria’s solar energy capacity finally crept to 112 megawatts, a 2,700% growth from 2014. A giant one for renewables? Perhaps. But with 39% of Nigerians still without access to electricity, and 67.8% still burning wood to cook dinner, it feels more like a brisk shuffle forward.

Recently, the government announced a ₦10 billion solar budget for Aso Rock alone, the reason being that the annual electricity bill for the presidential villa has reached ₦47 billion, which officials say is unsustainable, bringing forth the need to diversify energy sources, cut governance costs, and reduce reliance on the national grid.

At least some people will have light to admire their own progress, but the rest of us must lean heavily on private sector innovation.

So, let’s help ourselves, individuals, SMEs and corporate companies. Let’s talk about two solar energy companies operating in Nigeria, comparing Lumos and Daystar Power.

Different philosophies, different strategies, but one mission, to drag Nigeria, kicking and screaming, into the age of clean, reliable energy.

Background of the Brands

Lumos

Lumos entered the Nigerian market with a simple pitch: affordable, pay-as-you-go solar systems, targeted mainly at households and micro-businesses.  

The company formed a partnership with MTN, leveraging mobile payments to deploy this solar system model. Its signature product? A “yellow box” solar kit — simple, affordable, and effective.

Daystar Power

On the other hand, Daystar took one look at the retail market and politely passed. Instead, it targeted the corporate sector, including banks, telecom towers and manufacturing plants. 

Its solutions, usually a combination of solar and hybrid energy systems, are designed for heavy lifting, backed by long-term contracts and serious engineering muscle. Shell Investments and other backers recognised Daystar’s potential early, pumping millions into its expansion.

Business Model Comparison

Lumos is the street hustler of solar. The company’s model is pay-as-you-go, highly consumer-friendly, and deeply integrated with mobile money. The focus is to scale fast and keep it simple.

Daystar, meanwhile, plays the long game. It operates a business-to-business (B2B) model, offering energy-as-a-service. Clients don’t buy solar panels; they sign up for long-term savings and reliable electricity without the headache of ownership.

Product/Service Offering

Lumos offers solar home systems designed to power small electronics like TVs, laptops, fans, lights, even clippers. Think of it as solar energy with training wheels. Lumos’ user experience is seamless. Sign up, pay a token via your phone, and bask in light.

Daystar provides industrial-scale solutions such as massive solar plants, hybrid systems combining solar, diesel, and battery storage. Remote monitoring, predictive maintenance, and optimised energy management are standard. While Lumos gives you a torch, Daystar is building the entire lighthouse.

Target Audience

Lumos focuses on low to middle-income households, small businesses, and rural communities usually abandoned by Nigeria’s national grid.

Daystar courts the big fish—banks, telecom operators, agricultural firms, and manufacturing plants—organisations where a power outage can cost millions.

Pricing and Affordability

Lumos is like a friendly loan shark — small initial payments, spread out through affordable mobile instalments. It’s electricity on a budget.

Daystar is a capital commitment. Upfront investments can be steep, but businesses are rewarded with energy savings over time. If Lumos is a sprint, Daystar is a marathon.

Market Presence and Reach

Lumos, powered by its MTN partnership, has spread across several Nigerian states, mostly focusing on areas with poor electricity access. Expansion beyond Nigeria remains tentative.

Daystar, on the other hand, has expanded across West Africa, with operations in Nigeria, Ghana, and Côte d’Ivoire, among others. With backing from Shell and other investors, its goals are decidedly continental.

Performance and Reliability

Lumos customers praise the ease of use and reliability, though many note that the systems struggle with heavy appliances. The company’s customer service and multi-year warranties are strong selling points.

Daystar boasts of uptime guarantees north of 99%, great engineering credentials, and a corporate client list that speaks for itself. It’s the solar solution you buy when failure isn’t an option.

Both brands have received industry recognition, but Daystar’s accolades usually include global awards for innovation and sustainability.

Challenges

Lumos faces a natural ceiling: its systems simply can’t power larger household devices like fridges or air conditioners without upgrades.

Daystar struggles with the high entry cost. Many SMEs would love a Daystar system but can’t afford the upfront costs or complex contracts.

Impact on Nigeria’s Renewable Energy Drive

Lumos has calmly led a grassroots solar uprising. In making solar accessible to rural homes and small shops, it has introduced millions to renewable energy.

Daystar is killing diesel—slowly but surely. Every bank branch or telecom mast that switches to Daystar shaves a little off Nigeria’s diesel dependency and reduces emissions.

In 2023 alone, Nigeria generated 50 gigawatt-hours of electricity from solar, maintaining growth. Renewables now contribute 20.5% of total power generation, thanks, in no small part, to companies like Lumos and Daystar.

In Nigeria’s solar sector, Lumos and Daystar are not competitors, they are allies on different fronts.

• Lumos is the democrat, bringing power to the people.
• Daystar is the strategist, rewiring industry from the ground up.
• For families and small shops in dusty towns, Lumos is the light at the end of the tunnel.
• For banks, factories, and corporate giants, Daystar is the trusted path out of darkness.

Simple Comparison Table:

In a ceremony to mark the takeover at the NERC headquarters in Abuja, Sanusi Garba, the NERC Chairman expressed his delight that KSERC officials twinned with NERC and gained regulatory knowledge from staff members of NERC.

He assured that NERC will keep an open door to assist KSERC in their information need to support their seamless operation.

In his remarks, Engr. Ibrahim Abdulwaris, the chairman of KSERC, commended NERC for the support and twinning sessions during the transfer period.

He noted that KSERC will leverage the relationship towards more collaborations with NERC.

NERC is empowered by the Electricity Act 2023 to transfer oversight of the electricity market to states that apply for such and duly meet the requirements.

So far, NERC has issued orders of transfer of oversight of the electricity market to ten states. While some have fully taken charge, the others have up till July 2025 to fully take over the oversight in their respective states.

Even with decades of “endeavours,” our power sector always presents the same results: frequent blackouts, high costs of electricity, and an overwhelming reliance on petrol and diesel generators.

Nigeria, Africa’s largest economy serving a population of over 200 million, has an installed generation capacity of 13,000MW, but actual power output does not go beyond 4,000MW—far below the estimated demand of 30,000MW. 

Businesses lose billions annually due to unreliable power, while households are unable to keep the lights on.

Hence, we wonder if Nigeria should continue banking on fixing its dysfunctional national grid, or if it’s time to take up a decentralised alternative—mini-grids? 

While the national grid collapses under systemic failures, mini-grids have been seen as a feasible solution, particularly in off-grid communities. 

But can they scale fast enough to bridge the energy deficit? Or would hybrid just be the best solution?

Let’s discuss! 

The National Grid: Can it be Fixed?

Nigeria’s national grid, managed by the Transmission Company of Nigeria (TCN) and serviced by private electricity distribution companies (DisCos), is unreliable till today. 

The country has experienced repeated grid failures over the years, with 2024 recording 12 collapses, implying systemic weaknesses.

As of February 23, 2025, two major grid failures have already been reported this year. The first occurred on February 12, 2025, at 11:34 a.m., resulting in nationwide blackouts. 

Several electricity distribution companies, including Ikeja Electric and Abuja Electricity Distribution Company, confirmed the outage and worked to restore supply. 

However, the TCN denied that this was a full grid collapse, instead attributing the incident to a transmission line trip at the Omotosho-Ikeja West 330kV line.

While consumers are left in prolonged outages, official explanations downplay the severity of the problem, leaving millions inconvenienced.

Why Does the National Grid Keep Failing?

• Ageing Infrastructure: Much of Nigeria’s transmission network is outdated and prone to breakdowns.
• Transmission Bottlenecks: Even when power is generated, it usually cannot be efficiently transmitted due to network limitations.
• Revenue Shortfalls: DisCos find it hard to recover costs due to electricity theft, billing inefficiencies, and non-cost-reflective tariffs.
• Regulatory & Political Barriers: Government policies usually interfere with market-driven electricity pricing and investment.
• Heavy Reliance on Fossil Fuels: The national grid is highly dependent on gas-fired power plants, leaving it vulnerable to fuel supply disruptions.

Nonetheless, the government is working to overcome these challenges and expand and modernise the grid. The Siemens-backed Presidential Power Initiative (PPI) aims to boost generation and distribution capacity. 

However, results have been slow, and many Nigerians are sceptical about whether the grid can ever meet the country’s energy requirements.

Mini-Grids: A Decentralised Alternative

So mini-grids—independent, small-scale electricity systems—might just be the solution to the national grid’s weaknesses.  These decentralised power solutions, often powered by renewable energy sources like solar and hydro, have been particularly effective in rural communities where the national grid is either absent or unreliable.

Advantages of Mini-Grids

• Reliability: Mini-grids operate independently, meaning they are not affected by national grid failures.
• Scalability & Faster Deployment: Unlike large power plants, mini-grids can be deployed quickly, often in under a year.
• Sustainability: Many mini-grids rely on solar and hydropower, reducing dependence on fossil fuels.
• Lower Transmission Losses: Since they generate power close to consumers, mini-grids avoid the high transmission losses associated with the national grid.

Challenges of Mini-Grids

• High Initial Costs: Mini-grid projects require high upfront investment, making them difficult to scale without subsidies.
• Regulatory Uncertainty: Nigerian energy policies are focused on grid expansion, creating hindrances for mini-grid investors.
• Limited Capacity for Industrial Use: While great for households and small businesses, mini-grids may be unable to support large industries, unless strategically allocated.

With strategic planning and allocation, mini-grids can be designed to support specific industrial activities. For example, integrating productive uses of electricity, such as agriculture, manufacturing, and service sectors, can enhance the economic viability and sustainability of mini-grids.

Several successful mini-grid projects in Nigeria, such as Rubitec Solar in Lagos and Husk Power Systems in Nasarawa, show that this model can be successful. However, general adoption requires policy changes and financial support.

Comparing the Two Models: National Grid vs. Mini-Grids

What Works Best? The Case for a Hybrid Approach

Given the weaknesses and strengths of both models, Nigeria needs a hybrid approach. While the national grid is essential for industrial power needs, mini-grids can provide reliable electricity for communities and small businesses.

Key Recommendations:

• Grid Modernisation: Invest in smart grids, improved transmission infrastructure, and decentralised generation.
• Mini-Grid Incentives: Provide subsidies and regulatory support to attract investment in mini-grids.
• Public-Private Partnerships: Leverage private sector expertise to develop both grid and off-grid solutions.
• Renewable Energy Integration: Scale up solar, wind, and hydropower generation across both national and mini-grid networks.

Nigeria’s electricity problem demands assertive reforms and innovative solutions. While the national grid is important, its frequent failures ascertain the need for alternative energy models. 

Mini-grids provide a decentralised, renewable, and resilient solution that can complement the national system.

Hence, policymakers need to take up this hybrid vision, or Nigeria’s power sector will continue to operate in the dark.

The manufacturers declared the exercise unfruitful, even as Nigeria requires 30,000MW of electricity to appreciably meet the growing electricity demand.

MAN said beneficiaries of the privatisation lacked the technical and financial capacity to operate and deliver power optimally.

MAN made the declaration yesterday in a public statement that decried the incessant increase in electricity tariff, which it said had hindered the performance of the manufacturing sector and growth of the economy.

The statement signed by Mr. Segun Ajayi-Kadir, the director-general of MAN, urged the government to commission a review of the performance of power Distribution Companies (DisCos) after the last unwarranted increase.

It also asked government to conduct a study on the impact of the increase on the manufacturing sector, in particular, and businesses and households, in general

Ajayi-Kadir urged the government to sincerely and critically interrogate the so-called cost reflective tariff template of the DisCos, and audit their level of commitment to investment in distribution infrastructure.

He emphasised that electricity was a critical input in manufacturing processes, with significant effect on production cost and prices of products.

The statement said,

“It was based on the critical importance of energy security in achieving the industrial aspiration of Nigeria, that the power sector was privatised in 2013 to improve the scale of energy supply to the nation, particularly the industries.

“Unfortunately, this particular privatisation has not yielded the desired results. It is widely believed that this is because the operators in the value chain lack the technical and financial capacity to operate and deliver optimally.”

Ajayi-Kadir pointed out that the Nigerian power sector’s installed capacity, put around 10,000 megawatt (MW), had not been fully utilised due to the limited capacity of the power generating companies (GenCos) and DisCos to generate and distribute adequate electricity nationwide.

He said,

“Despite the inability to meet the consumer demand, we have witnessed consistent increase in tariff without a commensurate and good quality supply.

“According to the National Bureau of Statistics (NBS), the electricity supply stood at 5,909.83 (Gwh) in Q2 2023 but reduced to 5,769.52 (Gwh) in Q1 2024 and 5,612.52 (Gwh) in Q2 2024, when the tariff increase of over 230 per cent was implemented.

“Thus, indicating 5.03 per cent decrease year-on-year and 2.72 per cent quarter-on-quarter.”

According to him, MAN has severally advocated increase in electricity supply from the abysmal average of 4,000MW of electricity per day for over 200 million people.

He said Nigeria needed more than 30,000MW of electricity to appreciably meet the growing electricity demand by businesses and households in the country.

Ajayi-Kadir also advised the government against yielding to any proposed increase in electricity tariff because it would be “inimical to the competitiveness of Nigerian products and businesses”.

He said such increase would also further exacerbate the effect of high cost of production, worsen the current inflationary pressure, aggravate the pressure on the disposable income of the average Nigerian, increase the unsold inventory of manufacturers, erode their profit margin, increase unemployment rate, and lead to closure of more private businesses.

The MAN director-general stated, “The persistent increase in tariff means that consumers will continue to bear the brunt of the inefficiency in the electricity value chain.  “As it stands, manufacturers are disadvantaged as the increase cannot be transferred to consumers who are currently battling with low purchasing power.

“However, I am not certain that the federal government has reached the conclusion that electricity tariff would be increased. I hope not.”

According to MAN, it goes without saying that incessant increase in electricity tariff in Nigeria is hindering the performance of the manufacturing sector and growth of the economy.

It said, “No nation can attain significant industrial development without energy security, which is timely access to sustainable and cost-effective energy.”

MAN added that “sustainable and low-cost energy supply provides incentives for scale production and competitiveness of the industrial sector”.

This development comes as the Nigerian Electricity Regulatory Commission (NERC) changed pricing control to competitive bidding, thereby aiming to increase transparency and efficiency in the sector.

Beginning November 5, 2024, the cost of single-phase meters has jumped from an average of N117,000 to as much as N149,800, depending on the DisCo and meter vendor. 

This upward revision impacts Nigerian electricity consumers, who are struggling with the growing cost of accessing metering services amidst inflationary pressures.

Breakdown of New Meter Prices Across DisCos

An overview of the latest prices reveals varied charges based on location and vendor, showing the diverse operational aspects and competition levels across the country:

• Eko DisCo: Single-phase meters range from N135,987.5 to N161,035, while three-phase meters are priced between N226,600 and N266,600.
• Ibadan DisCo: Single-phase meters cost between N130,998 and N142,548, with three-phase meters at N226,556.25 to N232,008.04.
• Abuja DisCo: Single-phase meters are priced from N123,130.53 to N147,812.5, and three-phase meters between N206,345.65 and N236,500.
• Kano Electricity: Single-phase meters range from N127,925 to N129,999.75, while three-phase meters cost between N223,793 and N235,425.
• Kaduna DisCo: The cost of single-phase meters varies between N131,150 and N142,548.94, with three-phase meters at N220,375 to N232,008.04.

Deregulation and the Changing Meter Market

Earlier in April, NERC announced a change in policy by deregulating the meter prices under the MAP scheme. Previously, NERC controlled meter prices across DisCos to reduce customer costs, but the centralised approach inadvertently hindered competition and transparency within the supply chain. 

NERC’s revised order now allows MAP permit holders to operate and price meters competitively, with the intention of enabling a healthier market that benefits both consumers and DisCos through improved pricing and service delivery.

Under the new model, DisCos and customers are encouraged to engage with multiple vendors, creating an open market where competitive bids determine meter prices. 

This flexibility also enables MAP providers to expand their services across Nigeria, provided they meet compliance and quality requirements set by NERC. 

However, some industry stakeholders warn that deregulation could make meters less affordable for the average Nigerian, as competitive pricing might not immediately translate to lower costs in a period of rising inflation.

Implications for Nigerian Consumers

With prices reaching over N140,000 for single-phase meters in some regions, affordability has become a focal issue, especially as electricity access and cost remain critical for many Nigerians. 

The adjustment in meter prices adds another layer to household expenses, making access to metered electricity increasingly challenging for lower-income households.

NERC has asserted that this policy is designed to boost the sector by enhancing competition among MAPs, which should theoretically lead to long-term benefits, such as better service quality and increased transparency. 

However, the short-term impact reveals further stress on consumers already facing high energy tariffs and rising costs of living.