- Nigeria is expanding its electricity market and regional power-trading capacity.
- Low generation remains the key challenge despite 8,700MW of transmission capacity.
Nigeria is repositioning its electricity market to meet rising domestic demand and expand regional power trading.
The Nigerian Independent System Operator (NISO) said the country can now wheel about 8,700 megawatts (MW) through its transmission network. However, actual power generation remains far below installed capacity.
NISO Managing Director Abdu Mohammed said the operator is improving coordination across the electricity value chain. The work covers generation, transmission and distribution. The aim is to improve efficiency and make better use of available power. It could also strengthen Nigeria’s position in the West African electricity market.
“We are rejigging the energy market and we have the capacity to deliver value to regional economies,” Mohammed told LEADERSHIP. He said Nigeria could provide commercial electricity to neighbouring countries while meeting its own growing demand.
The comments followed reports that Ghana could supply electricity to Nigeria. Ghana already exports power to Togo, Benin, Côte d’Ivoire and Burkina Faso. Ghana wants to expand its role as a regional electricity supplier. Nigeria could become another market for its surplus power.
However, Mohammed said NISO had not discussed electricity imports with Ghana. He pointed instead to Nigeria’s large generation base and its potential to supply other West African markets. Both Nigeria and Ghana belong to the West African Power Pool (WAPP). The regional market allows member countries to trade electricity across borders.
Sadiq Wanka, Special Adviser to the President on Power Infrastructure, said power could move between both countries when market conditions make it commercially attractive. He said Nigeria has strong gas, hydro and solar resources. These resources give the country the potential to remain a net electricity exporter over time.
Wanka also said Ghana could supply Nigeria during periods of surplus generation. Such imports would not necessarily change Nigeria’s longer-term position as a regional exporter.
Nigeria’s bigger challenge remains the gap between installed capacity and actual generation. The country has 13,625MW of installed generation capacity, according to the Nigerian Electricity Regulatory Commission (NERC).
Yet the national grid has never received power close to that level. The highest recorded generation delivered to the grid reached 5,801.84MW on March 4, 2025. The figures point to significant unused generation capacity. They also show that adding more power plants alone will not solve Nigeria’s electricity problems.
The country must improve gas supply and plant performance. It must also address market liquidity and distribution constraints. Transmission capacity has expanded in recent years. The Transmission Company of Nigeria (TCN) said its network can now wheel about 8,700MW.
TCN Managing Director Sule Ahmed Abdulaziz said the grid can evacuate all available generation. He therefore does not consider transmission capacity the main constraint at present.
TCN has increased wheeling capacity from about 7,000MW to 8,700MW. The company has also expanded transformation capacity across the country. Between January 2024 and November 2025, TCN commissioned 82 power transformers. The projects added about 8,500 megavolt-amperes (MVA) to the grid.
The company also secured more than $1.4 billion in development financing. The funding came from institutions such as the World Bank, African Development Bank, Japan International Cooperation Agency (JICA) and Agence Française de Développement.
Meanwhile, Nigeria is changing how its electricity market operates. The Electricity Act 2023 allows states to establish electricity markets within their jurisdictions. The law has also created more room for private investment. Investors can now explore opportunities across different parts of the electricity value chain.
This decentralisation could encourage more embedded generation and mini-grid projects. It could also bring electricity production closer to consumers. However, investors will need to understand both federal and state electricity regulations.
NISO will play an important role as the market develops. Mohammed said the operator would promote a more transparent and orderly electricity system. He also said NISO would focus on reliability and power quality. Better system management will become more important as electricity trading expands.
Nigeria still faces a major investment gap. Experts estimate that annual electricity investment must rise from about $1 billion to roughly $10 billion. That level of investment would support wider electricity access and provide more reliable power for industry.
Nigeria therefore has two priorities. It must improve the use of existing power assets while investing in new infrastructure.
Success at home could also strengthen its regional position. More reliable domestic supply would give Nigeria a stronger foundation for electricity exports across West Africa.