The Federal Government has said sweeping reforms introduced in Nigeria’s power sector under President Bola Tinubu’s Renewed Hope Agenda are beginning to yield measurable results, with improvements recorded across the electricity value chain.
These improvements across the electricity value chain have attracted $2 billion in investment, as the Federal Government cut liabilities to ₦146 billion.
The Minister of Power, Adebayo Adelabu, disclosed this on Thursday in Abuja during the inauguration of the new headquarters of the Nigeria Electricity Liability Management Company, describing the development as a critical milestone in strengthening the sector’s financial and institutional framework.
Adelabu said the reforms, anchored on policy overhaul, market liberalisation and institutional strengthening, are repositioning the power sector for sustainability and increased private sector participation.
He noted that the unveiling of NELMCO’s headquarters goes beyond infrastructure, stressing that it symbolises renewed efforts to stabilise the sector.
“The commissioning of NELMCO’s new headquarters is more than the unveiling of a building, noting that it represents a reinforcement of the institutional and financial backbone required to sustain the reform process,” he said.
The minister commended NELMCO for reducing inherited liabilities from N2.303tn to ₦146.76 billion, adding that the agency has also delivered over ₦700 billion in savings to the Federal Government through verification and reconciliation processes.
He further disclosed that the company cut ground rent claims from N644bn to N41.8bn, while also achieving a 45 per cent reduction in post-privatisation debts owed by Ministries, Departments and Agencies to electricity distribution companies.
“The agency has played its role in stabilising the sector, disclosing that it has reduced inherited liabilities from N2.303tn to N146.76bn and delivered over N700bn in savings to the Federal Government through rigorous verification and reconciliation processes,” he added.
According to him, these efforts have improved liquidity in the sector and boosted investor confidence.
Adelabu linked the progress to the implementation of the Electricity Act 2023, which he said has decentralised the electricity market and created room for subnational participation.
“Central to the reform drive, he noted, is the Electricity Act 2023, which has enabled the decentralisation of the sector and opened the door for subnational participation. This, he said, has already led to the activation of 16 state electricity markets, while also stimulating competition and innovation within the industry,” he said.
He added that the development of a National Integrated Electricity Policy, the first in over 20 years, has provided a unified framework for implementing reforms and improving coordination between federal and state governments.
The minister also revealed that the reforms have attracted over $2bn in fresh investments into the sector, while ongoing efforts to transition the industry to full commercialisation have strengthened its financial outlook.
“We have recorded a 70 per cent growth in sector revenue in 2024, alongside a reduction of about N700bn in government liabilities. These are clear indicators that efficiency is improving and cost recovery mechanisms are working,” Adelabu stated.
On operational performance, he said generation capacity has increased from 13 gigawatts to 14 gigawatts, with a peak generation of 5,801.44 megawatts recorded.
He also highlighted efforts to close Nigeria’s metering gap through the Presidential Metering Initiative, backed by ₦700 billion mobilised through the Federal Account Allocation Committee and an additional $500 million World Bank facility.
“The government is addressing the long-standing metering gap through the Presidential Metering Initiative, backed by N700 billion mobilised through the Federal Account Allocation Committee and an additional $500 million World Bank facility, with procurement processes already underway to deliver millions of meters nationwide,” he said.
Adelabu further disclosed that Nigeria recently achieved synchronisation of its national grid with those of other ECOWAS countries after a successful four-hour uninterrupted test run.
He said the feat demonstrates growing stability and technical capacity within the system and signals readiness for expanded regional electricity trade.
“This milestone underscores our readiness to integrate more effectively into the regional power market and leverage cross-border electricity exchange for improved supply,” he added.
The minister maintained that the reforms are focused on building a transparent, sustainable and commercially viable power sector capable of supporting economic growth.
He stressed that the progress recorded so far reflects the government’s commitment to delivering reliable and affordable electricity to Nigerians.
Nigeria’s power sector has long struggled with liquidity challenges, weak infrastructure and poor revenue collection, despite the 2013 privatisation of generation and distribution assets.
The introduction of the Electricity Act 2023 marked a significant shift, granting states greater control over electricity markets and paving the way for increased investment and competition.
While recent gains are encouraging, sustained policy consistency, improved gas supply and continued investment will be critical to achieving a stable and reliable power supply nationwide.
The latest reform update comes amid growing public frustration over persistent power outages across the country.
Earlier this week, Adelabu publicly apologised to Nigerians, admitting that the situation had caused hardship for households and businesses.
“I want to apologise to Nigerians for this temporary issue that is leading to hardship,” he said, noting that the outages have affected homes, schools and industries.
He attributed the disruptions largely to gas supply constraints and infrastructure challenges, particularly during the current dry season when electricity demand has surged.
The minister, however, assured Nigerians that efforts were underway to restore stable supply, expressing optimism that improvements would be seen within weeks.
The PUNCH