Nigeria eyes $15b private investors cash for power sector

Nigeria is taking bold steps to revive its faltering power sector, aiming to attract $15 billion in private investments while keeping its most vulnerable citizens in mind.

At a World Bank energy summit in Tanzania, the government outlined a plan that combines higher electricity tariffs with fresh subsidies to ease the burden on households.

Under the proposal, households will receive 50 kilowatt hours of subsidized electricity monthly, either through direct consumption or vouchers. This is part of a broader effort to address a massive $23 billion funding gap in the power sector and bring electricity to the 86 million Nigerians still living in the dark.

Despite being Africa’s top natural gas producer with abundant hydro and solar resources, Nigeria generates a paltry 13,000 megawatts of electricity for over 200 million people. For comparison, South Africa, with just 62 million people, produces 52,000 megawatts. Frequent blackouts and widespread reliance on private generators have become the norm for Nigerians who can afford them.

The government’s pitch includes plans to double the number of households connected to the grid annually and boost renewable energy from 22per cent to 50per cent of the generation mix within five years. While the nation removed subsidies for about 15per cent of urban households last year, tripling tariffs, it still spent N2.2 trillion on subsidies. The new plan aims to implement full-cost tariffs by 2027 while providing a buffer for vulnerable households.

The country’s power sector ambitions are similar to its recent oil sector recovery, where a combination of strategic planning, good fortune, and bold leadership brought production back from near collapse. With a renewed focus and an investor-friendly pitch, the nation is looking to spark a similar turnaround in its power sector.

THE NATION