The president of Nigeria, Bola Ahmed Tinubu has expressed deep concern over Nigeria’s electricity crisis, stating that despite the privatisation a decade ago, more than 90 million Nigerians still lack access to electricity.
The president was represented by his Special Adviser on Power Infrastructure, Sadiq Wanka, lamented the stagnation in the grid’s capacity, which has barely increased from just over 3000MW to slightly above 4,000MW today. This falls significantly short of the Federal Government’s pre-privatisation target of 40,000MW by 2020. Moreover, he underscored the financial challenges faced by the sector, noting that only 60% of electricity sent to the grid is paid for, and existing tariffs do not reflect the actual costs, especially in light of the recent devaluation of the Naira.
Speaking at the 10th-anniversary event of the Nigerian Electricity Supply Industry (NESI) Market Participants and Stakeholders Roundtable in Abuja, Sadiq highlighted the grim reality that the national grid only caters to approximately 15% of the country’s demand. Consequently, households and factories are forced to rely on expensive self-generation, which supplies a staggering 40% of the nation’s demand, Dailytrust reported.
Addressing the critical issues plaguing the sector, President Tinubu stressed the urgent need for widespread metering, stating that only around 45% of NESI customers are metered. He highlighted the government’s commitment to supporting the metering drive through the World Bank DISREP program and the Meter Acquisition Fund. Additionally, he emphasized the necessity of rebasing tariffs to accurately reflect the costs and losses throughout the value chain while ensuring adequate cost recovery for investments.
In response, Minister of Power, Adebayo Adelabu, underscored the government’s intention not to renew licences for private sector entities in the electricity supply chain without scrutinizing the investments and infrastructure made in the sector.
Expressing dissatisfaction with the sector’s progress since privatisation, Adelabu questioned the efficacy of the privatisation strategy, suggesting that commercialisation with heavy government involvement might have been a more viable approach. He criticized private investors’ lack of patience in waiting for the sector to yield anticipated profits. The statements highlight the pressing need for a comprehensive reevaluation of Nigeria’s electricity strategy amid growing challenges in the sector.