Stakeholders Push for Nigeria’s Power Sector Reforms, Cost-Reflective Tariffs
By Naija Enquirer Staff
Stakeholders in Nigeria’s power sector have renewed calls for urgent reforms to enhance efficiency, expand electricity access, and ensure sustainable operations through decentralised energy systems and cost-reflective tariffs.
Speaking at the 5th Annual Conference of the Power Correspondents Association of Nigeria (PICAN) held in Abuja, participants emphasised the importance of micro-grids, embedded generation, and off-grid systems in strengthening Nigeria’s energy resilience and tackling rural electrification challenges.
Decentralisation Key to Energy Access
Engr. Lamu Audu of the Nigerian Independent System Operator (NISO) highlighted that decentralised energy solutions can improve efficiency and attract much-needed private investment. He cited the Electricity Act 2023 as a progressive legal framework that empowers states to create local power markets and collaborate with the private sector to expand generation and distribution capacity.
“Decentralised power systems and embedded generation are the future of Nigeria’s electricity market. They reduce transmission losses, promote local participation, and ensure more stable power supply,” Audu said.
Tariff Reform to Drive Investment
Audu also stressed the importance of tariff reform, warning that keeping electricity prices artificially low discourages investors and compromises supply reliability. He urged regulators to adopt a cost-reflective tariff structure that balances investor returns with consumer affordability.
“Tariffs must reflect the true cost of power generation and supply while remaining fair to consumers. Without fair pricing, the sector cannot attract capital or sustain operations,” he added.
Financial Constraints Threaten Sector Stability
PCAN Chairman, Obas Esiedesa, described the sector’s deepening financial crisis as a major impediment to progress. He disclosed that the Federal Government currently owes ₦6 trillion to power generation companies, a debt burden that continues to strain liquidity and discourage new investment.
Esiedesa further cited gas shortages, currency instability, and ageing infrastructure as additional challenges, urging urgent policy interventions to stabilise the power value chain.
Consumers Demand Fairness and Transparency
Chief Princewill Okorie of the Electricity Consumer Protection Advocacy Centre criticised electricity distribution companies (DisCos) for poor service delivery and non-transparent billing practices. He called on regulators and human rights organisations to strengthen enforcement of consumer protection laws.
“Consumers are paying for power they do not get. Regulators must act to enforce fair billing, improve service delivery, and restore confidence in the system,” Okorie said.
Pathway to a Sustainable Power Market
At the conclusion of the conference, stakeholders unanimously agreed that Nigeria’s power sector requires a balanced, transparent, and practical reform agenda. They identified decentralised energy, cost-reflective tariffs, and strong consumer protection as the three pillars of a sustainable and inclusive electricity market.
They urged both federal and state governments to accelerate implementation of the Electricity Act 2023, promote private investment, and prioritise policies that can bridge Nigeria’s enduring electricity access gap.
