The Federal Government of Nigeria has unveiled an ambitious plan to attract $15 billion in private investments to revitalize the nation’s power sector, aiming to bridge a $23 billion funding gap. This initiative, announced at the World Bank Energy Summit in Tanzania, seeks to address the country’s persistent electricity challenges and provide power to the 86 million Nigerians currently lacking access.
As part of this strategy, the government will offer households a subsidized 50 kilowatt-hours (kWh) of electricity monthly, either through direct consumption or vouchers. This subsidy is a critical component of the broader plan to make electricity more accessible and affordable for millions of Nigerians.
Despite being Africa’s most populous nation with abundant natural resources, including natural gas, hydro potential, and sunlight, Nigeria has only 13,000 megawatts of installed generation capacity. This limited output has led to frequent blackouts and a reliance on private generators, imposing economic strains on households and businesses.
However, challenges persist. Over the past decade, despite $1.4 billion invested in the power sector, the national grid has collapsed 105 times. Nigeria also secured about 10 loans worth $4.36 billion from the World Bank during this period to address key challenges in its power sector.
The government’s current plan to attract $15 billion in private investments, coupled with the retention of subsidies for vulnerable households, reflects a comprehensive approach to reforming the power sector. By addressing funding gaps and ensuring affordability, Nigeria aims to create a more reliable and inclusive electricity supply for its citizens.
