Challenges relating to Electricity Supply in Nigeria

Challenges/Problems relating to Electricity Supply in Nigeria

Adequate electricity supply is necessary for a country’s economic development. Successive administrations in Nigeria have made various attempts to improve electricity supply. In this article, we take a look at some of the challenges and obstacles relating to electricity supply in Nigeria. Some of the challenges identified include old and inefficient and distribution network, poor logistics, climate change, insecurity, etc.

Electricity Supply, Development and Nigeria

All over the world, electricity is an important factor for both economic growth and socioeconomic development. Adequate supply of electricity is essential for economic development, because inadequate electricity supply hinders socioeconomic activities, restricts economic development and reduces the standard of living.

This is because electricity supply is important for proper functioning of key sectors of the economy such as service sector, industries, agriculture, and transportation.

As the population of Nigeria increases, the electricity demand increases proportionately; hence, the need to address the electricity crises facing the nation.

At the moment, electricity supply in Nigeria is unreliable and increases cost of production thereby reducing efficiency and competitiveness of local products and services.

Electricity Supply Status in Nigeria

Nigeria is endowed with a wide range of resources for electricity generation such as natural gas, sun (solar), coal, petroleum, hydro, etc; however, the country is unable to generate enough energy to meet its electricity demands. According to a World Bank report, only 48% of Nigeria’s 174 million people had access to electricity in 2013.

How then can the Nigeria increase its low electricity supply to an adequate level.

The Niger Dams Authority was established in 1962 to develop hydroelectricity and was later merged with the Electricity Corporation of Nigeria (ECN) to form the National Electric Power Authority (NEPA) in 1972.

Due to the inability of NEPA to meet the electricity demand of the growing population, the National Electric Power Policy (NEPP) was introduced in 2001 to kick-start a series of power sector reforms.

The NEPP in 2001 created the blueprint for the country’s Power Sector Privatization and was signed into law in 2005. The aim of this signed document was to encourage private investment in the power sector and improve electricity supply to Nigerians.

Thereafter, the Power Holding Company of Nigeria emanated from NEPA and later gave rise to more than 15 companies saddled with the responsibility of electricity generation, transmission, marketing, distribution and supply in the country.

Despite the series of reforms in the power sector, electricity supply has in Nigeria has been a dilemma.

As at 2015, Nigeria’s electricity utility grid comprised of four hydro power plants and six thermal generating stations with total installed capacity of more than 10, 000 MW but the production have never exceeded 3, 000 MW. During this time, data from reliable source indicated that Nigeria’s electricity production and consumption from the national grid was just a little above 2500 MW.

Challenges/Obstacles to Electricity Supply in Nigeria

Despite Nigeria being the largest economy in Africa, its Electricity access is low compared to the top ten economies in Africa.

In this section, we examine some of the challenges and obstacles relating to electricity supply in Nigeria.

1. Inefficiency:

The electricity generation and distribution system in Nigeria is grossly inefficient. The inefficiency is both technical and financial.

Technical: According to a World Bank Report Nigeria’s electricity sector has one of the highest rate of losses (33%), and the lowest generating capacity factor (20%), among a group of 20 low income and upper income countries.

Financial: Electricity tariffs are below the cost of service and there is poor revenue collection. Due to inefficiency in the sector, about 30-40 per cent of power supplied is never billed.

The power sector suffers enormous cash loss per month. Consequently, the Federal Government of Nigeria spends hundreds of millions of dollars as annual subsidy to cover losses.

The electricity generation efficiency is grossly low as the power plants in Nigeria are operating at a very low efficiency. This low efficiency is due to lack of proper maintenance culture in the power plants.

On the consumer side, low efficiency on electricity consumption occurs when the utility consumers don’t switch off their electrical appliance or use energy efficient appliances.

2. Climate Change and Hydro-electricity:

The increasing global climate change is threatening the future of the electricity sector in Nigeria.

Its impact on water supply has adversely affected electricity generation from hydro sources in Nigeria. Since the power output of hydro plants is dependent on the water level, with less water, there is less potential energy to harness.

3. Niger Delta Crises, Gas Supply and Electricity:

The supply of gas to the nation’s power plants has been affected by the security problems in Nigeria especially in the Niger Delta region.

The Niger Delta region where most of the thermal power plants are located still faces vandalism of gas pipes that supply gas to the various electricity generating plants across the country.

Hence, the challenge of inadequate gas supply has also been a major problem facing the power sector.

4. Poor Logistics:

There is inadequate data for proper estimation of the customers to plan for. This is responsible for the uneven allocation and distribution of available resources such as transformers.

5. Old Transmission lines and Distribution Network:

Electric cables that make up Nigeria’s transmission and distribution network are too old. This leads to uncontrolled power losses in the process of transmission.

Electricity losses result in lower power availability to the consumers, leading to inadequate power to operate the appliances. Thus, the high efficiency of the power system is determined by its low power losses.

In addition, regular vandalism of the lines, associated with low level of surveillance and security on all electrical infrastructures contribute to the poor electricity supply in Nigeria.

In order to improving electricity supply in Nigeria, there is the need to address the issues aforementioned.


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