NIGERIA
Overview
Nigeria is the largest economy in sub-Saharan Africa. Despite its privatisation in 2013, the Nigerian electricity supply industry delivers power that is significantly less than what is needed to meet the basic household and industrial needs. The country is endowed with large oil, gas, hydro and solar resources, but grid power is generated through thermal and hydropower sources. Nigerians and the country’s businesses spend around ₦5 trillion annually on small-scale generators that are expensive and hazardous to the environment.
Generation
Nigeria has 29 power generation companies connected to the grid with an installed capacity of 12,522MW. Its thermal stations can generate 10,142MW while hydro 2,380MW. However only about 4,000MW of electricity is currently generated, and this is predominantly due to gas constraints.
Transmission
The Transmission Company of Nigeria (TCN) manages the electricity transmission network in the country. It is one of the 18 companies that was unbundled from the defunct Power Holding Company of Nigeria (PHCN) in 2005. Nigeria’s transmission network consists of high voltage substations with a total capacity of 7,500MW and over 20,000km of transmission lines. Presently the transmission wheeling capacity (5,300MW) is higher than the mean generation capacity (3,879MW), but it is way below the total installed generation capacity. TCN is responsible for transporting electric power generated by electricity generation companies over to the distribution companies of Nigeria.
Distribution
In Nigeria, there are 11 electricity distribution companies (DisCos). DisCos are the front-end organisations in the electricity value chain. They act as an interface between the customers and the upstream part of the chain. A report published by the Independent Energy Watch Initiative (2016) ranked each of the DisCos according to certain parameters such as responsiveness, value for money, electricity supply infrastructure among others, and the Jos DisCo was rated highest while the Benin DisCo was the least rated.
Renewable energy
The World Bank highlights off-grid renewable energy technologies as the silver bullet for total electrification in Nigeria and sub-Saharan Africa by 2030. Thus, the country is beginning to explore its abundance of renewable energy resources which include solar, wind, biomass, and hydropower. Off-grid renewable energy is largely contemplated as the beam of hope to the millions of Nigerians without access to electricity. There are at least 40 privately-owned companies in Nigeria’s renewable energy sector headed by the Renewable Energy Association in Nigeria (REAN). The growth of the renewable energy industry is driven by the abundance of solar radiation, a constant decline in the cost of solar energy components, and the growth of project developers. As a result of this growth, the installed mini-grid increased from 1MW in 2018 to over 4MW in 2020. The vision of this sector is to improve the contribution of renewable energy up to 40 per cent of the National Energy Mix, by 2030.
Electricity Tariff
Electricity tariff in Nigeria are as follows
|
Distribution companies (DisCos) |
Service Band A (₦/kWh) |
Service Band B (₦/kWh) |
Service Band C (₦/kWh) |
Service Band D (₦/kWh) |
Service Band E (₦/kWh) |
|
Abuja DisCo |
48.041, 64.202, 53.053 |
46.141, 61.292 |
41.651, 54.032 |
|
|
|
Benin DisCo |
53.481, 49.272, 48.843 |
52.311, 48.332 |
46.661, 44.052 |
|
|
|
Kano DisCo |
58.751, 65.002, 70.143 |
56.16 |
48.09 |
|
|
|
Port Harcourt DisCo |
55.201, 54.802, 52.203 |
54.801, 52.202, 51.703 |
51.701, 49.202 |
|
|
|
Eko DisCo |
51.501, 54.072 |
47.551, 50.232 |
38.441, 45.122 |
40.821, 47.772 |
36.151, 39.632 |
|
Enugu DisCo |
55.93 |
54.80 |
48.89 |
|
|
|
Ibadan DisCo |
62.331, 61.332, 59.703 |
58.391, 57.332, 56.333 |
53.971, 52.932, 51.363 |
48.991, 47.932, 46.673 |
30.391, 40.302, 45.403 |
|
Ikeja DisCo |
51.221, 53.662, 54.123 |
46.931, 47.712 |
53.611, 37.952, 42.803 |
|
|
|
Jos DisCo |
50.731, 57.532, 60.863 |
48.991, 55.792, 57.833 |
47.211, 54.012, 56.053 |
|
|
|
Kaduna DisCo |
56.31 |
54.11 |
50.10 |
38.47 |
33.80 |
|
Yola DisCo |
|
|
51.121, 56.122, 59.123 |
46.461, 50.572, 53.573 |
|
Key: subscripts 1,2, and 3 represent Non-MD, MD1, and MD2 respectively.
Industry Prospects
The Federal Government of Nigeria set up three key ambitious targets for its electricity sector. By 2030, it hopes to have achieved access to electricity for all, 30 per cent renewable energy contribution to the energy mix, and improved electricity generation to 30GW.