The Minister’s Call for N6trn Yearly Revenue to Stabilize Nigeria’s Power Sector
The Minister of Power, Chief Adebayo Adelabu, revealed that Nigeria needs about N6 trillion each year to ensure a stable power supply. Speaking at the Nigerian Oil and Gas Energy Week in Abuja, he emphasized the necessity of significant investments to boost power generation and distribution.
Currently, the industry generates around N1 trillion annually, but an additional N5 trillion is needed to stabilize the power supply.
Adelabu highlighted the need for the industry to attract the N16 trillion that individuals and businesses spend annually on generating their own power.
He stated that achieving a stable and uninterrupted electricity supply requires substantial funds beyond what the government alone can provide.
He also noted that the power industry is larger than the telecommunications industry, pointing out the massive expenses on diesel, petrol, and generators by Nigerians.
In 2023, a study showed that self-generation costs amounted to N16.5 trillion, while the formal power sector’s revenue was just N1 trillion.
Despite a $1.3 billion debt owed to gas suppliers, Adelabu urged the oil and gas sector to provide more gas to support power generation.
He mentioned that the domestic gas-power market supplies 60% of Nigeria’s gas needs, sustaining the 4GW average grid generation capacity.
Looking forward, according to the Nigeria Energy Transition Plan vision 30:30, by 2030, Nigeria aims to achieve 30GW of power, with 70% (21GW) from thermal sources (mainly gas) and 30% (9GW) from renewable sources. To reach the 70% thermal energy target, the power sector would need over five times the current domestic gas supply.
This goal requires additional investments to increase gas production without affecting export commitments. Adelabu called on investors to consider investing in the development of Nigeria’s vast untapped gas reserves.
