Energy stakeholders, policymakers, and industry experts convened for the 116th Power Dialogue to examine the theme: “Power and Productivity: How Energy Cost Exposes Power Sector Gaps.” The session brought to the fore urgent concerns about Nigeria’s energy landscape, emphasising the far-reaching economic and social implications of rising electricity and fuel costs.
Moderated by Sokoyebom “Yum” Alabi, an energy and policy research consultant with Nextier, the dialogue featured leading voices across research, policy, and renewable energy, including Basil Abia (Co-founder and Chief Research Officer, Truva Intelligence), Achenyo Alfa (Program Coordinator, Husk Power Systems), and David Arinze (Renewable Energy Specialist and Lead, Renewable Energy Thematic Group, Nigeria Economic Summit Group).
Energy Costs Driving Inflation and Economic Strain
Opening the discussion, Basil Abia highlighted that recent spikes in global energy prices, driven in part by geopolitical tensions, are not merely temporary shocks but indicative of deeper structural imbalances within Nigeria’s energy system. He noted that rising fuel prices are directly contributing to inflationary pressures and reducing GDP growth prospects. According to projections, Nigeria may experience an additional 1.5% increase in inflation due to current energy price trends, alongside continued contraction in household consumption.
Despite these challenges, Abia pointed out that higher global oil prices could boost government revenues, presenting an opportunity to reinvest in critical energy infrastructure.
Power Supply Deficits Undermining Productivity
The dialogue underscored how unreliable electricity supply continues to hinder productivity across sectors. David Arinze emphasised that energy access is fundamental to economic activity, noting that increased reliance on diesel generators has significantly raised the cost of goods and services, from printing to small business operations.
He stressed that off-grid and on-grid solutions should not be viewed as competing alternatives but as complementary systems that can collectively improve energy access. However, affordability remains a major barrier, particularly in the adoption of renewable energy solutions such as solar.
Bridging the Gap: Policy, Regulation, and Implementation
Achenyo Alfa highlighted that Nigeria does not lack regulatory frameworks but rather struggles with implementation and enforcement. While the Electricity Act provides a foundation for decentralised energy governance, inconsistencies between federal and state regulations, coupled with weak enforcement mechanisms, continue to discourage investment.
She called for improved coordination among regulators, clearer policy direction, and stronger enforcement to build investor confidence and accelerate energy access, particularly in underserved communities.
Identifying Systemic Bottlenecks Across the Value Chain
The panel identified critical bottlenecks across generation, transmission, and distribution:
- Generation: Despite abundant gas resources, supply is constrained by infrastructure challenges, pipeline vandalism, and commercial inefficiencies.
- Transmission: Aging infrastructure and limited capacity prevent efficient power evacuation, with outdated systems unable to handle peak generation levels.
- Distribution: High Aggregate Technical, Commercial, and Collection (ATC&C) losses, driven by poor metering and revenue collection, continue to undermine the financial viability of distribution companies.
Experts agreed that addressing these issues requires significant liquidity injection, infrastructure modernisation, and adoption of data-driven solutions such as centralised systems and SCADA technologies.
The Rise of Alternative Energy and Local Manufacturing
With grid limitations persisting, solar and hybrid energy systems are gaining traction. However, stakeholders emphasised the need for innovative financing models, import duty reforms, and local manufacturing to make these solutions more accessible.
Arinze further noted that Nigeria’s growing population presents a unique opportunity to position the country as a hub for renewable energy manufacturing, leveraging local resources such as lithium and cobalt.
E-Mobility and Emerging Opportunities
The dialogue also explored the growing interest in electric mobility. While electric vehicles (EVs) present environmental and economic benefits, participants highlighted the need for supporting infrastructure, including widespread charging stations and reliable power supply.
Pilot initiatives, such as EV charging stations and battery-swapping models in rural communities, demonstrate the potential for scalable solutions if properly supported.
A Call for Strategic Action and Policy Continuity
Panelists stressed the importance of long-term planning and policy continuity to sustain reforms in the power sector. Recommendations included strengthening institutional frameworks, enhancing coordination between federal and state actors, and establishing mechanisms to ensure consistent policy implementation across administrations.
Basil Abia further advocated for the establishment of a strategic oil reserve to shield the economy from future global energy shocks, describing the current crisis as a “generational stress test” for Nigeria’s energy resilience.
In closing, the panelists agreed that rising energy costs have exposed fundamental weaknesses in Nigeria’s power sector, but also present an opportunity for transformation. Addressing these challenges will require coordinated action across government, industry, and regulatory bodies.
The 116th Power Dialogue ultimately highlighted a critical reality: energy is the backbone of productivity. Without reliable, affordable, and sustainable power, Nigeria’s economic ambitions will remain constrained. The path forward lies not just in identifying the gaps, but in decisively closing them.