Infrastructure deficit, vandalism mar Nigeria’s power sector growth in 2024
By Seun Ibiyemi
In an alarming turn of events, Nigeria’s national power grid collapsed 12 times in 2024 under President Bola Tinubu’s administration, leading to widespread power outages that disrupted lives and crippled businesses across the country. This marks a 43.9 percent increase in grid collapses compared to 2023, when the power sector faced a major crisis despite receiving a significantly smaller allocation of N239 billion.
For 2024, the Nigerian government allocated a whopping N344 billion to the power sector, an effort to address chronic power shortages and grid instability. Yet, even with this substantial budget increase, frequent outages have continued to ravage the nation, exacerbating existing economic challenges and placing a strain on businesses, healthcare, and everyday life.
The national grid’s collapse, on average, occurs every few weeks, and these disruptions underscore the grave deficiencies in the country’s power infrastructure. With a personnel cost of N4.59 billion allocated to the sector, the Nigerian government’s budgetary commitments seem to have done little to alleviate the persistent instability plaguing the energy sector.
A Deepening Crisis
The World Bank estimates that Nigeria loses approximately $29 billion annually due to unreliable electricity supply—a figure that reflects the devastating toll power failures have on the economy. The ripple effects of these outages are felt in every facet of life: businesses are forced to use expensive backup generators, healthcare facilities face difficulties in maintaining critical services, and households endure intermittent power supply, undermining quality of life.
Despite government efforts, including new policy reforms and initiatives aimed at improving power generation, the national grid remains a symbol of Nigeria’s energy woes. The administration’s inability to resolve the crisis highlights the urgent need for a long-term, comprehensive solution to the country’s energy deficit.
Underlying Causes of Grid Instability
Several factors contribute to the chronic instability of Nigeria’s national power grid. Aging infrastructure remains a major issue, with many parts of the grid outdated and in desperate need of maintenance. Over the years, insufficient investment has hampered efforts to upgrade and expand the infrastructure to meet Nigeria’s growing energy demand.
Another critical factor is the issue of gas supply, which directly impacts the country’s thermal power plants. Nigeria’s dependence on gas-fired plants to generate electricity has been hindered by frequent shortages in gas supply, leaving much of the nation in darkness.
Moreover, acts of vandalism, particularly in northern Nigeria, continue to damage key transmission infrastructure. These attacks disrupt power transmission, leading to widespread outages. The demand-supply imbalance also exacerbates the crisis, with the grid struggling to meet the growing electricity demands of a population exceeding 200 million.
Current Capacity vs. Actual Generation
Nigeria’s installed power capacity is estimated at 13,500 megawatts, but the country generates and distributes only about one-third of that potential on a consistent basis. This severe underutilization of available resources has led to a reliance on privately owned generators, which millions of Nigerians use to meet their daily electricity needs.
The result is a crippling energy crisis that not only affects the average citizen but also hinders industrial productivity and economic growth. The inconsistency in power supply has deterred investment and increased the operational costs for businesses that already face multiple challenges in a difficult economic environment.
Government Responses and Initiatives
In an attempt to address these challenges, the Nigerian government has introduced several reforms and initiatives:
Decentralisation of Power Generation: Recent policy changes have allowed individual states to generate and transmit their electricity. Lagos, for example, is developing an independent power market to reduce reliance on the national grid.
Promotion of Renewable Energy: The government has entered partnerships with international organizations, such as the World Bank, to enhance rural electrification through mini solar grids. However, large-scale solar projects have faced significant hurdles, primarily due to the government’s reluctance to provide the necessary guarantees to developers.
Infrastructure Rehabilitation: Efforts are underway to rehabilitate and expand the transmission network, with international funding and technical support aiding in these endeavors. But the sheer scale of the task raises questions about whether these initiatives will produce the desired results in a timely manner.
The road ahead: Recommendations for reform
To mitigate the persistent instability of Nigeria’s power sector, experts suggest several crucial steps:
Increased Investment: A significant capital infusion is needed to mmodernise the aging infrastructure and expand capacity to meet the growing demand for electricity. This could be achieved through public-private partnerships and greater foreign investment.
Enhanced Security Measures:
Strengthening security around power infrastructure is vital to combating vandalism. This can include surveillance systems and regular patrols in vulnerable areas.
Diversification of Energy Sources: The government must invest in renewable energy, such as solar and wind, to diversify the energy mix and reduce dependence on gas-fired power plants. This would make the grid more resilient to disruptions in gas supply.
Regulatory Reforms: Streamlining regulations to encourage greater private sector participation and investment is essential to revitalizing the power sector. This includes creating incentives for independent power producers and removing bureaucratic bottlenecks.
Capacity Building: Training and development programs for technical personnel will help improve maintenance and operational efficiency in the sector, ensuring that power generation and distribution are more reliable.
Improved Grid Management: Implementing advanced grid management technologies, such as smart grids, could significantly improve the resilience and efficiency of Nigeria’s power infrastructure.
Conclusion
The persistent grid collapses in Nigeria throughout 2024 have brought the country’s power crisis to the forefront of national discourse. While commendable efforts by the Tinubu administration, led by the Minister of Power Adebayo Adelabu, have seen some reforms and investments, the power sector remains in a state of instability. As long as these challenges are left unaddressed, Nigeria will continue to face economic stagnation, with businesses, households, and the health sector bearing the brunt of the crisis.
For Nigeria to realise its full economic potential, a reliable and efficient power sector must be prioritised. This requires bold investments, enhanced security measures, and a shift towards renewable energy solutions that can provide long-term stability. Only with sustained, transformative action will the country overcome its electricity crisis and unlock the growth and prosperity that its people deserve.
