Nigeria’s persistent struggle with unreliable electricity reached a critical point in 2026, when Adewale-Smatt Oyerinde, Director-General of the Nigeria Employers’ Consultative Association (NECA), publicly called for a fundamental shift. He stressed the urgent need for sustainable, long-term solutions to the nation’s energy crisis, which had plagued its development for decades and continued to stifle progress.
His appeal, made during an exclusive interview with BusinessDay, highlighted that previous interventions frequently overlooked the necessity of enduring strategies. The country’s energy woes impacted over 85 million people, with an estimated 43 percent of the population still disconnected from the national grid.
Why short-term fixes failed to resolve the Nigeria energy crisis
The energy crisis wasn’t merely about insufficient generation; it was a systemic failure spanning decades. Over 80 percent of Nigeria’s projected electricity demand remained unmet, and a substantial portion of available power vanished through inefficient distribution and transmission networks. This chronic instability crippled businesses and households alike, leading to frequent national grid collapses.
Nigeria’s historical reliance on fossil fuels, particularly gas, for its energy mix also proved unsustainable. While the nation boasted vast gas reserves, converting them into reliable electricity proved challenging due to infrastructure deficits, pipeline vandalism, and persistent supply issues. This dependence also clashed with the country’s 2060 net-zero emissions target, adopted during COP26.
A century of struggling for light: Nigeria’s power history
Nigeria’s quest for consistent power began in 1896 with the introduction of electricity by colonial authorities. The formal structure evolved with the Electricity Corporation of Nigeria (ECN) in 1950, which later merged with the Niger Dams Authority (NDA) in 1972 to form the National Electric Power Authority (NEPA).
By 1999, the power sector was in severe decline, with only 19 of 79 generation units operational and daily generation averaging a mere 1,750 MW. Decades passed without significant new infrastructure. The government’s 2005 Electric Power Sector Reform (EPSR) Act aimed to overhaul the sector, renaming NEPA to Power Holding Company of Nigeria (PHCN).
The landmark privatization of the power sector in 2013 promised increased generation and efficiency through private capital. However, a decade later, electricity supply showed little improvement. Challenges like inadequate plant maintenance, obsolete equipment, and funding problems persisted, leaving over 100 million Nigerians without reliable access. The impact of economic reforms on energy supply proved limited.
Even the Power Reform Act 2023, which decentralized regulatory authority to states, faced an uphill battle. These historical efforts consistently struggled with inadequate infrastructure, poor maintenance, and insufficient funding, creating a cycle of underperformance that Oyerinde’s 2026 call sought to break.
Oyerinde’s vision for a sustainable energy future
Oyerinde advocated for a comprehensive, strategic approach to power generation and distribution. He pointed to the updated Energy Transition Plan (ETP), launched in October 2024, as a crucial framework. This plan aimed to address energy poverty, combat climate change, and achieve net-zero emissions by 2060, delivering on SDG7 by 2030.
The ETP outlined pathways for low-carbon development across key sectors including Power, Cooking, Transport, Industry, and Oil and Gas. Its ambitious goals required an estimated capital investment of approximately $500 billion above business-as-usual spending. Such an investment promised significant fuel savings of $686 billion, making it economically viable in the long run.
Central to Oyerinde’s recommendations was the expanded use of renewable energy sources. Nigeria possessed vast, untapped potential in solar, wind, hydro, and biomass. For example, only 20 percent of its hydro potential was utilized, and none of its 5.5 KW/hr/m² daily solar radiation was effectively harnessed.
The Nigeria Energy Transition Office (ETO), established in 2022, had already mobilized over $3.6 billion in investment towards these goals.
Projects like the World Bank-backed Nigeria Distributed Access through Renewable Energy Scale-up (DARES), which secured $750 million in December 2023, aimed to bring reliable power to 17.5 million of the 85 million unserved Nigerians. Renewable mini-grids were identified as a cost-effective solution for rural electrification, promising an $8 billion annual market. Nigeria’s economic outlook often depended on these crucial infrastructural improvements.
The crippling cost of darkness: Lives and livelihoods affected
The human toll of Nigeria’s energy crisis was immeasurable. Over 85 million people lacked access to modern energy, primarily in rural areas, hindering basic development and quality of life. Daily power outages disrupted education, healthcare, and household routines across the nation.
Economically, the unreliable power supply cost the Nigerian economy over ₦48 trillion annually, a figure close to the federal budget. This translated to an estimated $28 billion annually in lost productivity and increased operational expenses for businesses. More than 70 percent of Nigerian enterprises relied on expensive fossil-fuel generators to sustain operations, adding $22 billion yearly to their costs.
This burden disproportionately affected small and medium-sized enterprises (SMEs), stifling innovation and growth. Critical sectors like manufacturing and agriculture, vital for job creation and diversification, faced severe disruptions. The continuous need for alternative power sources eroded profits and made Nigerian goods less competitive.
Towards a brighter future: Economic impact and the path forward
Oyerinde’s call underscored the necessity of prioritizing long-term energy security, not just for economic gain, but for national stability. Achieving the ETP’s goal of 277 GW total installed power capacity by 2060, heavily leaning on renewables and energy efficiency, was paramount. This strategic pivot could alleviate the dual battle against logistics and energy crises, transforming the nation’s economic landscape.
Nigeria’s energy future now depended on a concerted, strategic vision. It meant moving beyond intermittent fixes and committing to sustainable development, harnessing its vast renewable resources. This fundamental shift was crucial not only for economic prosperity but for improving the quality of life, health, and opportunities for all Nigerians, finally illuminating a path forward after decades of darkness.
