A recent report from the Nigerian Electricity Regulatory Commission (NERC) has highlighted a concerning decline in the country’s available electricity generation capacity. According to the report, Nigeria’s electricity generation capacity has dropped by 2,324 MW due to factors such as diminishing plant capabilities, poor maintenance caused by liquidity concerns, and other challenges within the electricity supply industry.
Despite a minor increase in the existing electricity generation capacity, the available electricity declined significantly by more than 2,300 MW between 2015 and 2022. The report noted that since the privatization of electricity generation companies in 2015, the installation and generating capacity of power plants connected to the grid have increased. As of December 2022, a total of 28 power plants, both privately and publicly owned, were operational and connected to the grid.
The report revealed that challenges such as deteriorating plant capacities, inadequate maintenance due to financial constraints, limited access to foreign exchange, non-binding contracts, delayed payments, and stringent regulatory measures contributed to the decline in available electricity capacity. Despite NERC’s recommendations and regulatory support to address these issues, the average daily generation continued to decrease.
While the report acknowledged some improvements in competition within the electricity generation segment due to various regulations and market dynamics, it highlighted the need for addressing challenges in the industry to ensure sustainable and reliable electricity supply for the Nigerian populace.
