By: Tijani Salako.
The Federal Government has pledged to increase electricity access to over 80 per cent within the next five years and close the gap between installed and available power generation within three years as part of efforts to tackle the energy crisis affecting Nigeria’s manufacturing sector.
The commitment was disclosed by the Minister of Power, Joseph Tegbe, during a presentation titled Industrialisation and Regional Competitiveness: The Role of Power at the just-concluded Nigeria Economic Summit Group event in Lagos.
The minister also said the government would align with the Nigerian Electricity Regulatory Commission’s target of reducing Aggregate Technical, Commercial and Collection (ATC&C) losses to below 16.92 per cent within three years.
The presentation, delivered on his behalf by his Special Adviser, Martins Olajide, outlined plans to strengthen major transmission corridors, including Lagos, Enugu–Port Harcourt, and Abuja–Kaduna–Kano, while expanding electricity access and improving supply reliability for businesses and households.
“Over 80 per cent access, ATC&C losses below 17 per cent, the capacity gap closed — Nigerian industry gets the reliable, affordable power it needs to compete for AfCFTA’s 1.4 billion consumers,” Tegbe said.
He noted that the reforms align with President Bola Tinubu’s goal of transforming Nigeria into a $1 trillion economy, stressing that electricity is central to achieving that ambition.
“President Bola Tinubu has been absolutely clear about the economic direction of this administration — to transform Nigeria into a one trillion-dollar economy — and electricity sits at the heart of that ambition,” he said.
Tegbe added that work had already begun on strengthening transmission infrastructure across the Lagos, Enugu–Port Harcourt and Abuja–Kaduna–Kano corridors, alongside the rollout of seven million electricity meters, training of 5,000 personnel and the development of captive power clusters for industries.
“The plan is in motion: transmission corridors through Lagos, Enugu–Port Harcourt and Abuja–Kaduna–Kano are being strengthened, seven million meters are rolling out, training of 5,000 recently commenced, and captive economic clusters are linking power directly to industry,” he said.
He added that the government was working towards creating an independent electricity market with less government intervention, improved liquidity, greater sustainability and reduced sector debts and losses.
The ministry described Nigeria’s electricity deficit as a major obstacle to industrialisation, noting that while the country has 13,625 megawatts of installed grid capacity, only about 4,854MW is available on an average day.
According to the presentation, about 62 per cent of installed capacity remains idle, while realistic peak demand is estimated at about 20,000MW. It added that inadequate electricity supply has forced businesses to depend heavily on self-generation, significantly increasing production costs.
“4,500 to 5,000MW average available for 200m+ people. Twenty-six grid collapses in 2024. Energy accounts for 30 to 40 per cent of factory costs,” the minister stated.
The presentation further revealed that Nigerians spent about N16.5 trillion on self-generation in 2023, compared with roughly N1 trillion generated through the national grid, while the World Bank estimates that unreliable electricity costs the Nigerian economy about $25 billion annually, equivalent to between five and seven per cent of Gross Domestic Product.
The ministry said improved grid stability, expansion of transmission infrastructure and the creation of economic clusters would boost industrial productivity, attract investment and improve the competitiveness of Nigerian industries through more reliable and affordable electricity.
Speaking on a panel at the summit, the Director of Research and Economic Policy at the Manufacturers Association of Nigeria (MAN), Dr Oluwasegun Osidipe, said inadequate energy supply remained the biggest challenge facing manufacturers, according to the association’s Q2 2026 Manufacturers’ CEO Confidence Index.
“In the Q2 2026 Manufacturers’ CEO Confidence Index Report, manufacturers identified 10 major constraints limiting their operations, and inadequate energy supply ranked first,” he said.
Osidipe said manufacturers had invested heavily in alternative power generation because of unreliable grid supply, further eroding their competitiveness.
“Manufacturers have not only established production facilities, they have also built power-generating plants. The cost of maintaining those facilities is enormous. Manufacturers spent about N1.35 trillion on alternative energy sources in 2025,” he said.
He noted that the figure excludes electricity bills paid to distribution companies, making it even harder for local manufacturers to compete.
“And that is excluding the bills paid for grid electricity. How do you expect such a manufacturing concern to remain competitive?” he asked.
Osidipe also identified regulatory bottlenecks as a major challenge, saying manufacturers face multiple agencies, overlapping regulations and excessive administrative charges.
“The second issue is regulatory tyranny. Time that CEOs and staff should devote to production is spent responding to different regulatory agencies,” he said.
He further listed exchange rate volatility, dependence on imported machinery, spare parts and strategic raw materials, as well as poor coordination between monetary and fiscal policies, among the major constraints affecting the manufacturing sector.
“The manufacturing sector cannot be competitive in an environment where the government’s right hand is countering what the left hand is offering to industry,” Osidipe added.
