Power sector facing challenges at every stage — Minister

The Federal Government has highlighted several challenges affecting the electricity sector across Nigeria, stating that the issues are present at every stage of the value chain. These challenges include constrained gas supply, ageing generation equipment, deferred maintenance, financial constraints, and infrastructure constraints, all of which are hindering power supply and increasing the burden on consumers.

The Minister of Power, Joseph Tegbe, emphasized that the government's priority is to address these issues rather than imposing additional costs on Nigerian households. Tegbe stated that his administration has been working to diagnose the problems, stabilize existing infrastructure, and restore market discipline. He also mentioned that the sector's weaknesses include poor payment discipline, with generation companies receiving only 27% of their bills.

The sector diagnosis revealed that only 27% of generation companies' bills were paid, which undermined their ability to maintain plants and pay gas suppliers. Additionally, the distribution companies are experiencing significant technical, commercial, and collection losses due to inadequate metering, estimated billing, damaged assets, and weak payment discipline.

Tegbe acknowledged that the challenges are interconnected, creating a cycle where unpaid electricity bills weaken gas supply, reduce maintenance, and result in unreliable electricity, which in turn reduces collections and increases sector debts. He emphasized that a new power station alone cannot resolve this cycle and that sustainable improvement requires repairing the physical system and strengthening commercial relationships.

The government has taken steps such as restoring the Alaoji open-cycle power plant, commissioning transformers to unlock transmission capacity, and installing over 350,000 electricity meters in the first 100 days. The minister also disclosed that the government has raised an estimated N1.23tn to address part of the N3.3tn power-sector debt backlog.