The Minister of Power, Chief Adebayo Adelabu, has revealed that Nigeria’s power sector requires approximately N6 trillion in annual revenue to ensure a stable and uninterrupted electricity supply.
Speaking at the ongoing Nigerian Oil and Gas Energy Week in Abuja, Adelabu emphasized the need for significant investment to enhance power generation and distribution across the country.
Currently, the industry generates about N1 trillion annually, necessitating an additional N5 trillion to stabilize power supply.
The minister highlighted the challenge of attracting the N16 trillion spent annually by individuals and entities on self-generation of power.
“The requirement to have a stable, uninterrupted, and functional electricity supply in Nigeria requires huge funds that the government and its budgets cannot afford to fund alone,” Adelabu stated.
He underscored the scale of the power industry compared to the telecommunications sector, noting the substantial amount spent on diesel, petrol, generators, and maintenance for self-generated power.
“Last year, a total of N16.5 trillion was spent on self-generation, while the revenue for the entire industry, the grid, and the formal power sector was just N1 trillion,” he added.
Despite the $1.3 billion debt owed to gas suppliers, Adelabu called on the oil and gas sector to supply more gas to the power industry.
“The domestic gas-power market accounts for 60 percent (approx. 700 MMSCF Daily) of the total domestic gas supply. This gas quantity currently sustains Nigeria’s 4GW average grid generation capacity,” he noted.
The minister outlined the vision of the Nigeria Energy Transition Plan, aiming for 30GW by 2030, with an energy mix projected to be 70% thermal (predominantly gas) and 30% renewable. To achieve this, the power sector would need over five times the current domestic gas utilization.
“Additional investments are necessary to increase the country’s gas production to meet this level of supply to the power sector without compromising export obligations. I call on investors to consider further development of gas production, especially our abundant unexploited Non-Associated Gas reserves,” Adelabu concluded.
The minister’s remarks underscore the critical financial and infrastructural needs of Nigeria’s power sector and the importance of strategic investments to ensure long-term energy stability and sustainability.