Despite a few strategic moves, the power sector continues to grapple with deep-seated structural issues, financial inefficiencies, and unmet performance expectations. TOPE SUNDAY writes.
Two years into President Bola Tinubu’s administration, Nigerians are still grappling with darkness—despite a staggering ₦2.34tn budgeted for the power sector. While bold reforms and new initiatives like the Electricity Act Amendment and the Presidential Metering Initiative signaled hope, the reality on ground remains grim: erratic supply, unresolved GenCo debts, stalled metering programs, and little relief for consumers battered by rising tariffs and failing infrastructure.
In his inaugural speech on May 29, 2023, Tinubu, pledged to ensure accessible and affordable electricity for all Nigerians.
Tinubu highlighted his administration’s dedication to delivering efficient governance in alignment with the aspirations of the Nigerian people.
He had said, “Electricity will become more accessible and affordable to businesses and homes alike. Power generation should nearly double, and transmission and distribution networks improved. We will encourage states to develop local sources as well”.
To walk the talk, President Tinubu signed the Electricity Act (Amendment) Bill 2024 into law in February 2024.
The bill, which was passed by the House of Representatives on July 27, 2023, and the Senate on November 14, 2023, was sponsored by Honourable Babajimi Benson, who represents Ikorodu Federal Constituency of Lagos State.
The Electricity Act (Amendment) Bill 2024 seeks to address the development and environmental concerns of host communities and sets aside five per cent of the actual annual operating expenditures of power generating companies (GENCOs) from the preceding year for the development of their respective host communities.
Also, in the 2024 fiscal year, the Tinubu-led administration
allocated approximately ₦344.1bn to the power sector, marking a 43.9 per cent increase from the previous year’s allocation of ₦239bn. This allocation represented about 1.45 per cent of the total federal budget for 2024.
Similarly, in 2025, his government also allocated approximately ₦2tn to the power sector.
This sums up the budgetary provisions for the power sector in two years under Tinubu to N2.34tn.
This development, stakeholders in the country’s power sector, viewed it as the administration’s determination to turn the sector around.
The administration in the year under review also introduced
Presidential Metering Initiative, which is aimed at eliminating estimated billing, closing the national metering gap, and improving consumer confidence in the electricity value chain.
According to the Minister of Power, the sum of N700bn had been secured to implement the initiative.
The initiative is built on the National Mass Metering Programme (NMMP) launched in 2020 and is seen as a continuation of the government’s efforts to ensure transparency in electricity billing.
As part of this effort, N59.28bn was earmarked by the Central Bank of Nigeria (CBN) under Phase Zero of the NMMP for the procurement and installation of one million meters. Although the actual disbursement amounted to N55.4bn, only 962,832 meters were reportedly installed, a shortfall that had raised questions about efficiency and transparency in execution.
The repayment performance has also been poor, with only N7.1bn refunded as of 2024, excluding the agreed nine per cent interest.
To cap it all, the Tinubu administration has created the Nigerian Independent System Operator (NISO) as a step toward unbundling the Transmission Company of Nigeria (TCN) and introducing competition and efficiency in system operations.
This move is seen by stakeholders as a potential enabler for future structural transformation in the sector.
However, despite the initiatives, significant challenges continue to undermine progress; a steady electricity supply remains elusive.
This has forced Nigerians to experience erratic power delivery, with insufficient generation and distribution infrastructure across the country.
Another major blow to the power sector under Tinubu is the unresolved GenCo debt.
The financial health of the sector remains fragile, compounded by the N4tn debt owed to power generation companies (GenCos).
This debt, according to GenCos, has strained the liquidity of the sector, weakened investor confidence, and continues to obstruct the flow of power from generation to end-users.
Also, twelve years after the 2013 privatisation of the power sector, there has been no formal review of the DisCos’ performance or their licences. This failure contravenes the original reform blueprint, which stipulated a mid-term licence review after five years.
Stakeholders argued that most DisCos are technically and financially insolvent and have shifted the burden of infrastructure investment to consumers.
In some cases, end-users reportedly contribute as much as N500,000 to fix local faults or purchase transformers.
Likewise, despite increases in tariffs, in some areas rising to N250/kWh, there is no corresponding investment in network upgrades or infrastructure expansion by the DisCos.
There have been allegations of widespread inefficiency, regulatory violations, and minimal reinvestment that continue to do their operations.
There is also an allegation of a lack of transparency in the handling of the National Mass Metering Programme (NMMP).