Nigeria’s longstanding power supply challenges may be on the path to resolution as the federal government introduces major interventions targeting the sector.
At the Nigeria Energy Summit in Lagos, Minister of Power Adebayo Adelabu announced that President Bola Tinubu has approved a N4 trillion bond to clear verified debts owed to Generation Companies (GenCos) and gas suppliers. He added that a targeted subsidy framework is being developed to protect vulnerable households while paving the way for full commercialization of the power sector.
Adelabu highlighted efforts to strengthen commercialization, boost revenue, and increase investor confidence. “Through tariff reforms that introduced cost-reflective rates for select consumers, supply reliability has improved, industrial energy costs have reduced, and sector revenue rose by 70 per cent to ₦1.7 trillion in 2024 compared to the previous year. Revenue is expected to surpass ₦2 trillion in 2025,” he said.
The Minister noted that the National Electricity Regulatory Commission (NERC) and State Regulatory Commissions are collaborating to monitor sector performance and enforce improvements across utilities.
Despite these gains, challenges remain. Several Distribution Companies (DisCos) face under-capitalization and a heavy debt burden that has affected operational efficiency and service delivery. To address this, the government plans to introduce minimum capital adequacy requirements during license renewals to strengthen the financial health and liquidity of the utilities.
On infrastructure development, Adelabu said the Federal Government has implemented targeted programs to modernize and expand the national grid. “Under Phase Zero of the Presidential Power Initiative (PPI), transmission capacity has been enhanced, grid stability improved, and overall system reliability strengthened, achieving over 700MW of additional transmission capacity,” he said.
These measures signal a decisive push to ensure a reliable, financially sustainable, and commercially viable power sector in Nigeria.