Power Sector Reforms Attract $2 Billion, Cut Liabilities – FG

The Federal Government of Nigeria has reported that reforms in the power sector under President Bola Tinubu’s Renewed Hope Agenda are yielding significant results. Improvements across the electricity value chain have attracted over $2 billion in investment, while liabilities have been reduced to N146 billion.

Minister of Power, Adebayo Adelabu, disclosed the figures during the commissioning of the new headquarters of the Nigeria Electricity Liability Management Company (NELMCO) in Abuja, describing the development as a major milestone in strengthening the sector’s financial and institutional framework.

“The commissioning of NELMCO’s new headquarters is more than the unveiling of a building; it represents a reinforcement of the institutional and financial backbone required to sustain the reform process,” Adelabu said. He highlighted that the agency reduced inherited liabilities from N2.303 trillion to N146.76 billion and delivered over N700 billion in savings to the government through verification and reconciliation processes. Ground rent claims fell from N644 billion to N41.8 billion, while post-privatisation debts owed by government agencies to electricity distribution companies were cut by 45 percent.

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Adelabu noted that the Electricity Act 2023 has decentralised the electricity market, enabling subnational participation. “Central to the reform drive is the Electricity Act 2023, which has enabled the decentralisation of the sector and opened the door for subnational participation. This has already led to the activation of 16 state electricity markets, while also stimulating competition and innovation within the industry,” he said.

Generation capacity rose from 13 gigawatts to 14 gigawatts, with a peak generation of 5,801.44 megawatts recorded. The Presidential Metering Initiative, backed by N700 billion from the federal allocation and a $500 million World Bank facility, aims to close the nation’s metering gap. The minister also announced successful synchronisation of Nigeria’s national grid with ECOWAS networks, underscoring readiness for regional electricity trade.

“The government is addressing long-standing metering gaps… with procurement processes already underway to deliver millions of meters nationwide,” he added. Adelabu affirmed that the sector reforms are laying the foundation for a transparent, sustainable, and commercially viable power industry capable of supporting economic growth.