Overview

The Power sector is a critical infrastructure needed for the economic, industrial, technological and social development of Nigeria. Electricity consumption has become one of the indices for measuring the standard of living of a country. In Nigeria power sector is presently being managed by the National Electric Power Authority (NEPA) as an integrated utility with generation, transmission and distribution all in the same organization. The national electricity grid presently consists of nine generating stations (3 hydro and 6 thermal) with a total installed generating capacity of 5906MW. The Transmission network is made up of 5000km of 330KV lines, 6000km of 132KV lines, 23 of 330/132KV sub–stations and 91 of 132/33KV substations. The Distribution sector is comprised of 23,753km of 33kv lines, 19,226km of 11kv lines, 679 of 33/11kv sub–station. There are also 1790 distribution transformers and 680 injection substations.

Although the installed capacity of the existing power stations is 5906MW the maximum load ever recorded was 4,000MW. Presently most of the generating units have broken down due to limited available resources to carry out the needed level of maintenance. The transmission lines are radial and are overloaded. The switchgears are obsolete while power transformers have not been maintained for along time. The distribution sub-sector is in dire need of upgrading as many of its distribution transformers are overloaded while the lines look more like „Cobwebs”. Overall transmission and distribution losses are in the range of 30–40%. The electricity network has been characterized by constant system collapses as a result of low generating capacity by the few generating stations presently in service.

The present installed generating capacity in Nigeria is around 6000MW and NEPA has only been able to generate a maximum of 4000MW. For a country of more than 120 million people, this indeed is grossly inadequate to meet the consumers’ electricity demand. The current projected capacity that needs to be into the system is estimated at 10,000 MW. It is hoped that these would come in through Independent Power Producers (IPPs) as soon as a liberalized Electricity Supply Industry is established in Nigeria. In addition, massive injection of funds is needed to expand the distribution and transmission networks to adequately transport the electricity generated to consumers.

Power Sector Reform

In order to attract private sector investment and sustain the development of the power sector to ensure uninterrupted and efficient power supply in the country, the NCP defined the objectives for power sector reform as follows:

• To promote competition to facilitate more rapid provision of service throughout the country.
• To create a new legal and regulatory environment for the sector that establishes a level playing field, encourage private investment and expertise, and meet social goals.
• To restructure and privatize the National Electric Power Authority (NEPA).
• To encourage the successors to NEPA to undertake an ambitious investment programme.