Nigeria's power sector reform: Progress and achievements

Nigeria's power sector has been undergoing significant changes and improvements in recent years, with the country now producing more power than it can sell. The Minister of Power Works and Housing, Babatunde Fashola, highlighted the progress made in the sector during a recent interview at the Power Summit in Lagos. Fashola pointed out that one of the major achievements in the power sector is the successful implementation of policies aimed at increasing power generation. Since 2015, the country has seen a significant rise in power generation from 2000 megawatts to 7001 megawatts as of September 12, showcasing an impressive growth in power production. However, the Minister also highlighted a new challenge facing the sector - the surplus power generated exceeds the current capacity of the distribution network, leading to issues with selling the excess power. This surplus power has created a need for substantial investment in upgrading the distribution infrastructure, including transformers and expanding transmission capacity to ensure efficient power distribution across the country. Fashola emphasized the importance of addressing these challenges to maintain liquidity in the sector and ensure that power generated translates into revenue. While the improvements in power generation are a significant achievement, the focus now shifts to enhancing the distribution network's capacity to accommodate the excess power and improve access to electricity for local communities. Despite the challenges, Fashola remains optimistic about the sector's future, highlighting the government's commitment to addressing these issues with a dedicated approach. The Minister outlined plans to support the distribution companies in accessing capital for infrastructure upgrades and reducing losses in the distribution network to enhance the sector's overall efficiency. Additionally, he discussed the importance of cost-reflective tariffs to ensure fair pricing and adequate return on investments for power producers. Fashola reiterated the need for transparent procurement practices and regulatory guidelines to prevent inflated costs from being passed on to consumers, emphasizing the significance of a balanced approach to tariff regulation. The Minister's approach to addressing the power sector's challenges reflects a comprehensive strategy that aims to enhance power generation, distribution, and affordability for all Nigerians. With continued investment and regulatory reforms, Nigeria's power sector is poised for further growth and development, driven by the government's commitment to achieving a reliable and sustainable power supply for the country.