In Search of Solutions to Nigeria’s Power Challenges

A Sector Seeking a Savior

Having electricity to power your home has three major components — generation, transmission, and distribution.

The Issue of Crazy Bills

While writing this section, someone chatted me up about the crazy bill his DisCo brought. Here is why that happens: GenCos and TCN have given a certain amount of energy to the DisCos. They expect to get paid. The DisCos get paid from only 25% of the energy users. But there is still a definite amount of energy used for which they cannot account for because of tampered meters and customers who are not even registered on the grid. So they do the next best thing — calculate how much they should get from the energy used and remove the revenue they got from the paying customers. The remaining balance is shared among registered users who do not have meters.

A House of Darkness

All these problems lead to Nigeria hosting the largest population living with no electricity access in the world. About 50% of Nigerians, 96 million, lack access to power (24). Out of the remaining 50% with access, only 25% of them are in the rural areas, according to the World Bank-sponsored Energy Progress Report of 2022 (25). This report shows that the access rate increased by an annual average of just 0.7% (4 million people) as against the population growth rate of 2.5% (14 million). All these despite Nigeria being one of the top three recipients of international public financing available for energy projects in the world. All these despite the Nigerian government spending N11 trillion on the sector since 1999 (26). In 2019, the Vice President said his government spent N1.5 trillion on the power sector in two years (27). The Central Bank of Nigeria (CBN) has provided N1.5 trillion in interventions and loans in the last 5 years to the sector.

References

1. https://www.thecable.ng/peter-obi-visits-egypt-to-understudy-countrys-education-power-finance-sectors

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