- Nigeria’s €2.3 billion Presidential Power Initiative failed to meet its targets and closed without raising electricity output beyond 7,000 MW.
- Experts say weak transmission and distribution infrastructure, alongside liquidity and gas supply challenges, continue to cripple the power sector.
Nigeria launched the Presidential Power Initiative (PPI) as its flagship electricity reform programme. However, the project has failed to meet its core targets despite a €2.3 billion (about ₦3.7 trillion) investment.
The Federal Government partnered with Siemens Energy to implement the five-year programme. The initiative aimed to increase Nigeria’s electricity capacity to 25,000 megawatts by 2025. However, industry data show that power output remains far below expectations. Generation still struggles to reach 7,000 MW.
The project roadmap outlined a phased expansion plan. The government aimed to reach 7,000 MW by 2021. It then targeted 11,000 MW by 2023 and 25,000 MW by 2025.
However, recent figures from the Nigerian Independent System Operator (NISO) show persistent shortfalls. Nigeria currently generates about 5,000 MW. The grid transmits roughly 4,000 MW and distributes about 3,000 MW. This supply serves a population exceeding 200 million people.
Industry operators attribute the gap to structural weaknesses in the electricity value chain. Nigeria’s installed generation capacity exceeds 12,000 MW. However, gas shortages, grid instability and weak distribution infrastructure limit actual output.
Meanwhile, FGN Power continues to drive the project. The company said it conducted extensive negotiations to secure financing arrangements. It also obtained regulatory approvals before implementation began. According to the company, these steps ensured transparency and long-term sustainability.
Phase 1 of the project remains in progress. Contractors expect to complete three substations by the end of 2026. These include New Abeokuta, Ayede and Onitsha. They also plan to complete substations in Sokoto and Offa by 2027. These projects will add about 984 MW of transmission wheeling capacity.
Furthermore, project managers expect to sign contracts for 12 additional substations in May 2026. Under Phase 1 Batch 2, developers target delivery by 2028.
Professor of Energy Law at the University of Lagos, Yemi Oke, highlighted structural weaknesses in transmission and distribution. He described distribution as the weakest link in Nigeria’s power value chain.
Oke noted persistent challenges in the sector. These include metering gaps, estimated billing and energy theft. He also highlighted tariff collection problems and significant commercial losses. Oke pointed to weaknesses in the transmission network. He cited frequent grid collapses and vandalism of high-voltage lines. He also noted the grid’s limited capacity.
The Transmission Company of Nigeria manages most transmission infrastructure. However, the network has struggled to exceed about 5,000 MW of wheeling capacity. Oke urged Nigeria to reduce its reliance on the centralised national grid. He recommended expanding decentralised systems such as mini-grids and embedded generation.
The Lagos Chamber of Commerce and Industry warned about economic consequences. The organisation’s Director-General, Dr Chinyere Almona, said unreliable power affects business operations. Many firms now rely on diesel and petrol generators. As a result, businesses face higher production costs. These costs weaken competitiveness and limit expansion by small and medium-sized enterprises.
Almona said unstable electricity discourages foreign direct investment. Investors often prefer economies with reliable energy infrastructure. In addition, she said that problems persist across the electricity value chain. These include transmission constraints, gas supply limitations and commercial inefficiencies in distribution companies. She called for stronger investments in transmission infrastructure. She also urged improvements in gas-to-power supply chains. In addition, she recommended regulatory reforms that improve transparency and financial sustainability.
The Centre for the Promotion of Private Enterprise also raised concerns. The organisation warned that weak electricity supply could constrain economic growth.
According to the group, productivity and industrialisation depend heavily on reliable power. However, many businesses rely on expensive alternative energy sources. This situation reduces competitiveness and increases production costs. The group also warned that poor electricity supply could weaken Nigeria’s position under the African Continental Free Trade Area.
Meanwhile, the Federal Government plans to establish a Grid Assets Management Company (GAMCO). The Federal Executive Council approved the proposal. President Bola Tinubu has also constituted an 11-member committee to review the implementation framework.
According to the Chief of Staff to the President, Femi Gbajabiamila, the proposed company will address challenges related to stranded generation capacity, grid management and transmission infrastructure. The committee will therefore review existing power sector laws, examine the implications of the Electricity Act 2023 and assess the ownership and operational framework of key assets such as the Niger Delta Power Holding Company and National Integrated Power Project plants.
If the initiative succeeds, GAMCO’s pilot phase will focus on unlocking stranded power from selected plants and developing a high-capacity transmission corridor along the Benin–Lagos axis.
However, power sector advocates have raised concerns about potential overlaps between the new structure and existing institutions. For instance, the Executive Director of PowerUp Nigeria, Adetayo Adegbemle, urged the government to clarify how GAMCO will interact with current power sector agencies and the Presidential Power Initiative in order to avoid duplication of responsibilities.
He warned that unresolved overlaps could create institutional conflicts and ultimately undermine ongoing reforms in Nigeria’s electricity sector.