Nigeria’s Electricity Crisis Is No Longer a Power problem—it is an Economic Emergency
By Jerry Adesewo
Ben Murray-Bruce’s recent open letter to President Bola Ahmed Tinubu, provocatively titled “Start the Dance on Electricity. The Privatisation Failed. The Owners Are Billing Darkness” deserves to be read beyond its political rhetoric. Beneath the colourful language and sharp accusations is a question that Nigeria can no longer postpone: ‘How much longer can Africa’s largest economy afford to operate without reliable electricity?
For decades, Nigeria has treated electricity as an infrastructure problem. It is much more than that. It is now an economic problem, a productivity problem, an investment problem, and, ultimately, a national competitiveness problem.
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The most disturbing feature of the crisis is not simply that Nigerians experience blackouts. It is that the country has constructed an elaborate economic system around the assumption that public electricity will fail. Businesses buy generators. Households buy generators. Banks, hospitals, hotels, schools, churches, and government institutions buy generators. Manufacturers maintain multiple power sources. Small businesses factor fuel into the price of everything they produce.
In other words, Nigerians are not merely paying for electricity. They are paying repeatedly for the failure of electricity.
The World Bank has estimated that unreliable electricity costs Nigeria between $25 billion and $28 billion annually, equivalent to roughly 5–7 percent of GDP in some estimates. It has also documented the enormous dependence of households and businesses on petrol and diesel generators, with more than 20GW of generator capacity estimated to be serving homes and small businesses—nearly twice the capacity connected to the national grid.
That should frighten any government more than the latest headline about a tariff increase.
A country cannot become an industrial power while businesses spend scarce capital generating the electricity required to manufacture goods. A baker who spends a significant portion of his income buying diesel cannot compete with a baker operating in a country where electricity is dependable. A manufacturer who must maintain generators as a permanent part of production has an additional cost that competitors elsewhere simply do not bear.
The consequence is visible in the prices Nigerians pay every day.
Electricity shortages increase the cost of production, transportation, food processing, refrigeration, telecommunications, and virtually every other economic activity. When the generator comes on, the meter may not be running, but the Nigerian economy is still paying.
This is why the electricity crisis must be viewed as an economic emergency rather than merely a complaint about poor service.
The tragedy is that Nigeria has spent years attempting to reform the sector without resolving its fundamental contradictions. The 2013 privatisation was supposed to introduce private-sector efficiency into generation and distribution. Instead, the country has inherited a complicated system in which private operators depend heavily on a financially fragile market, government intervention remains substantial, debts accumulate, and consumers remain dissatisfied.
The World Bank itself observed that the transition to a largely privately owned electricity sector did not produce the expected outcomes. It identified distribution losses, tariff weaknesses, and failures in the payment chain among the factors undermining the sector.
This is where Murray-Bruce’s intervention is particularly useful, even where one may disagree with some of his prescriptions. His central argument is that Nigeria must stop pretending that the existing model is working.
We cannot keep throwing money into the same structure and expect a different outcome.
There is, however, an important distinction to make. The failure of the electricity market cannot simply be blamed on DisCos and GenCos. The sector is a chain. Generation depends on gas supply and payment; transmission depends on infrastructure and system management; distribution depends on investment, metering, collection, and regulation; and the entire market depends on tariffs that are politically and economically sustainable.
Everybody has a part to play.
Government must therefore resist the temptation to respond to every crisis with another bailout. Public money may be necessary to stabilise the sector, but a bailout without structural reform merely converts private-sector weakness into public-sector liability.
The more promising development may actually be the decentralisation of electricity regulation.
The Electricity Act 2023 opened the door for states to establish and regulate electricity markets within their territories. By July 2026, NERC said 16 states had completed the transition to state electricity regulation. This is potentially one of the most consequential changes in Nigeria’s electricity architecture in decades.
It means that the old excuse that everything must be solved from Abuja is becoming increasingly difficult to sustain.
States can now develop electricity markets suited to their economic realities. Industrial states can develop dedicated power arrangements for manufacturing clusters. Commercial centres can encourage embedded generation and mini-grids. Rural communities can develop decentralised renewable-energy systems. States with abundant gas or renewable resources can build investment strategies around those advantages.
But decentralisation must not become another excuse for shifting blame.
If a state assumes regulatory responsibility for electricity, its government must also accept political responsibility for the quality of the electricity market within its jurisdiction. The era when every electricity failure could automatically be blamed on Abuja should gradually come to an end.
There are already examples suggesting that alternative models are possible. The Aba Integrated Power Project, for instance, combines generation and distribution within a ring-fenced area, with an initial generation capacity of 188MW. Its significance lies not simply in the number of megawatts but in the principle of integrating generation, distribution, and customers around a defined economic geography.
Nigeria needs more experimentation of this kind.
The future of electricity should not necessarily be one gigantic national system attempting to solve every problem from a single centre. It should be a network of interconnected systems: national infrastructure where national infrastructure makes sense, state-level markets where state markets make sense, and decentralised mini-grids and embedded generation where they are more efficient.
Solar, gas, hydro, and other technologies should compete according to economics and reliability rather than political fashion.
What matters ultimately is not whether the electricity comes from the national grid, a solar farm, a gas-fired plant, or a community mini-grid. What matters is that it comes reliably, predictably, and at a price businesses and households can afford.
That is the standard by which the Tinubu administration should ultimately be judged.
There have been reforms. There is now a legal basis for decentralisation. NERC and state regulators are developing mechanisms for coordination, including the Forum of Nigerian Electricity Regulators, while the Federal Government has begun addressing some of the institutional questions arising from the new framework.
But reform must now move from legislation to electricity. Nigerians cannot power their factories with Acts of Parliament. They cannot refrigerate vaccines with policy documents. They cannot run businesses on presidential assurances. And they certainly cannot build a $1 trillion economy in darkness.
The president, therefore, needs to make electricity one of the defining economic missions of his administration. Not another conference. Not another committee. Not another promise of megawatts. Nigerians need a measurable electricity compact: how many megawatts will become available, how many new connections will be delivered, how many customers will be metered, how much investment will enter the sector, and how much will the cost of unreliable electricity fall?
Most importantly, government must measure success not by the amount of money spent but by the amount of economic activity electricity makes possible.
A reliable electricity supply would do more than illuminate Nigerian homes. It would lower production costs, strengthen manufacturing, create jobs, improve healthcare, extend productive hours, make digital businesses more competitive, and attract investment.
That is why electricity should no longer be treated as simply another item on Nigeria’s infrastructure agenda.
It is the infrastructure upon which almost every other economic ambition depends.
Nigeria has spent too long paying for darkness. The real dance now is not between the President and the electricity sector. It is between Nigeria and the economic future it says it wants.
And time is running out.