?angote Refinery has exceeded Nigeria’s electricity generation growth over the past decade.
While Nigeria’s grid added just 760 megawatts in eleven years, ?angote’s refinery quickly produced 1,500 megawatts (MWs) independently.
Despite Nigeria’s potential to generate 13,000 MWs, its aging infrastructure currently delivers only 4,160 MWs on average, a modest increase from 3,400 MWs in 2013.
UGC Data obtained from the Nigeria Electricity System Operator demonstrated that, as of June 12, 2024, the average generation of 4,160 MWs had increased by 22%, from an average of 3,400 MWs in November 2013 to the Distribution Companies (Discos) delivery to the Generation Companies (Gencos) via the Transmission Company of Nigeria, (TCN).
However, following construction in 2018, Dangote’s oil refinery generated 1,500 MW of power—more than the entire country’s grid expansion accomplished in more than ten years.
Aliko ?angote confirmed, at the Afreximbank Annual Meetings, that the refinery’s power is used internally, avoiding pressure on the national grid.
The situation has raised concerns about the slow progress of Nigeria’s electricity sector, despite significant billion-dollar investments and an 11-year-old privatisation process.
Analysts highlight inefficiencies and management issues as key barriers to growth, contrasting Nigeria’s stagnation with rapid advancements in other African countries such as Egypt and Ghana.
A senior energy analyst at Sofidam Capital, Charles Akinbobola, said, “The Government and some operators in the sector may say there has been some form of growth since 2013, but in actual terms, how many people are benefiting from the privatised power sector? most conglomerates are generating their power.
“The challenge of the power sector has not entirely been the scarcity of funds, several trillions of naira have been pumped into that industry. The sector has been plagued by the shortcomings of its managers”.
Nigeria has the capacity to generate 13,000 MWs of power, while South Africa, with a comparable economy and 25% of the world’s population, can produce about 58,095 MWs. Yet, Nigeria’s aging power infrastructure only supplies approximately 4,000MWs of electricity to its 200 million inhabitants, or about the same amount as Edinburgh, home to 548,000 people, does.
To address power shortages, the Nigerian Electricity Regulatory Commission, (NERC), has directed a reduction in electricity exports, prioritising domestic supply amid unpaid bills from neighboring countries like Togo and Benin.
