How Nigeria can fix its power sector

Nigeria needs no less than $ 10 billion in the next few years to reinstate its power infrastructure.

Nigerian bureaucrats tend to have a ravenous inclination for monumental solutions to problems without putting practical measures in place to tackle the real issues, and this is clearly evident in the power sector. After spending over $10billion in the last 10 years to fix this problem, the power sector has continued to deteriorate, forcing Nigerians to look for alternatives.

Ever since Buhari assumed office as the president of Nigeria on May 29, 2015, the quality of power supply in Nigeria has dwindled. The power generated is grossly inadequate for its teeming population, where about 50 percent have no access to the national electricity grid and only 18 percent of people living in rural areas are connected. So far, the unbundling of the Power Holding Company of Nigeria (PHCN) and the privatisation of generation and distribution have not yielded any significant results as the industry still faces numerous challenges in the generation, transmission and distribution of electricity. This is in spite of the enormous investments made by the current and previous governments.

In Nigeria today, the biggest problem in electricity generation is the unavailability of gas to power the electricity plants. Consequently, many power plants are lying dormant or operating below their full capacities as a result of this.

Nigeria has a gas reserve of 187 trillion cubic feet, the 7th largest in the world, which is a huge potential revenue earner for the country if properly utilised. However, the sector remains largely ineffective due to the lack of investments, caused by a poor regulatory environment.

The poor gas infrastructure and constant pipeline vandalism are some of the greatest challenges faced by generation companies (GENCOs). Cases of pipeline vandalism have been on the rise in recent years and this action culminated in the production of zero megawatts of electricity a fortnight ago, in the country.


The need to promote investment and private participation in the gas sector is critical in improving the sector. Private investors should be encouraged to invest due to the likelihood of high profits and the government can support this by creating policies to revamp the industry. Also, they can help by giving out incentives, such as tax holidays, to entice investors.

The government should also consider deregulating the gas market so that the free market determines the price of gas. The inundation of investors into Nigeria’s gas industry could appreciably thrust the country’s revenue and create jobs for many of its citizens simultaneously.

Another major area which must be tackled to improve gas supply is the issue of pipeline vandalism. There is an urgent need to develop effective strategies to fight pipeline vandalism by all stakeholders in the gas industry. The government must enable security agencies with the tools and training to fight vandalism properly. Also, there should be strict penalties for defaulters because of the losses and excruciating pain they inflict on the masses due to poor power generation and its concomitant effects on economic activities.

A country that is ready to grow economically will invest in its energy sector and Nigeria, which has a vision to be among the top 20 nations economically by 2020, should focus more on the power sector as the present state of the power sector is deplorable.

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