Nigeria has more people without electricity than any other country
Fixing that will be fiendishly difficult
Nigeria has more people without electricity than any other country
Summarize
Fixing that will be fiendishly difficult
May 8th 2025
A welder sources power from fuel-powered generator in Nigeria
Noisy but necessaryPhotograph: Getty Images
Before George Etomi went to university in 1972, his home in Lagos, Nigeria’s commercial capital, had near-constant power. When he returned from studying abroad a few years later, power cuts had become frequent. By 1984, Mr Etomi needed a fuel-powered generator to open his law firm. Today roaring generators provide the soundtrack to urban Nigerian life. They produce more than twice as much power as Nigerians get from the grid.
Decades of underinvestment in Nigeria’s power supply mean it has not kept pace with the country’s growth. More than 90m of its 230m people live without access to electricity, the highest number in any country. Deep dysfunction in the sector and a gaping lack of funds mean things are unlikely to improve soon.
Plenty of poor countries struggle with intermittent power. Yet Nigerians are uniquely deprived. Just under half the country has never been connected to the national grid, which has never carried more than 6 gigawatts (GW). South Africa, which has suffered blackouts and load-shedding, manages 48GW of grid power for its 63m people. Even Bangladesh, poorer than Nigeria until recently and home to 170m people in an area a sixth of Nigeria’s size, generates around 16GW. In Nigeria, when production reached a high of more than 5GW one day in March, the surge made the grid collapse. When the power comes back, “it’s as if a goal has been scored in football,” says Mr Etomi.
The lack of grid power is a massive drag on the economy and Nigerians’ quality of life. Frequent power cuts in hospitals cost lives. Air-conditioning is a luxury. Tech entrepreneurs are forced to build their own power plants to run their data centres. More than half the country’s manufacturers no longer even bother to try to connect to the grid, according to the power minister. In 2023 Nigerians spent 16.5trn naira ($10.3bn) on generating off-grid power, equivalent to 60% of the entire government budget for the following year. That brings total supply to some 20GW, a quarter of the country’s estimated power needs.
Decades of underinvestment have kiboshed the system in so many different places that it is fiendishly hard to fix. The grid, still run by the government, is dilapidated and prone to collapse. That limits the amount of power it will agree to buy from generator companies. These, in turn, have problems beyond the lack of demand from the grid. Gas plants, which produce most grid power, are badly maintained and often fail to pay their suppliers. What’s more, gas prices are capped, which means it can be cheaper for suppliers to burn off gas rather than ship it to plants that may pay them very little or nothing. On average, plants run at less than half their capacity.
Distribution companies, 60% of which are privatised, struggle to cover their costs as people often fail to settle their bills. The government is the worst offender. Last year the distribution company in Abuja, the capital, threatened to disconnect the presidential villa and 86 government agencies over 47.2bn naira ($29m) of unpaid bills. When one company in Lagos asked the air force to pay for a nine-year backlog, soldiers stormed its headquarters and beat up the staff.
Powering up
Government initiatives have not got off the ground. A partnership between Nigeria, Germany and Siemens, a German firm, is supposed to add 12GW to the grid’s ability to handle throughput. But the project has completed only a pilot phase since it was signed in 2019. Privatisation, which helped improve telecoms and banking in the 1990s, has failed to revamp the power sector. More than half the distribution companies that were privatised in 2011 have gone bust, dampening investor appetite. “Why would anyone put a dime in the sector?” asks Noelle Okwedy, an energy analyst.
It is politically hard to persuade more people to pay for electricity, given the service’s shoddy quality, but the government has been trying. Still, even after prices quadrupled for the richest households last year, today payments cover only around 65% of the cost of providing power.
Most progress is being made off the grid. A consortium involving the World Bank and the African Development Bank wants to spend up to $55bn to provide electricity to 300m Africans, including many Nigerians, by the decade’s end. Concessional financing has helped build off-grid solar projects, such as a 12MW solar hybrid plant powering a university that was recently completed in the northern city of Maiduguri. In March, a group of organisations including Nigeria’s sovereign-wealth fund launched a $500m fund for bigger renewable-energy projects.
Such projects alone will not cover Nigeria’s massive electricity shortfall, so fixing the grid is still vital. Yet successful off-grid options may make it harder. As reliable solar alternatives or private power plants become more widespread, as in South Africa and Pakistan, the cost of maintaining and upgrading the grid will be shouldered by fewer people. As costs go up and service fails to improve or deteriorates, opting out entirely becomes ever more attractive. The government’s response looks muddled: it wants to integrate more solar power into the grid, but is also mulling banning the import of solar panels.
If the electricity problem is not fixed, the economy will also continue to operate below capacity. Nigeria cannot be Africa’s economic powerhouse until it can power its houses. ■
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