Reported By Mary Udezue | Edited by: Pierre Antoine
Nigeria’s electricity sector is once again in the spotlight as the national grid struggles to deliver reliable power amid escalating fuel supply constraints, particularly an acute shortfall in natural gas for thermal generating stations. The latest statements from the Nigerian Independent System Operator (NISO) underscore a growing structural crisis that has far-reaching consequences for industry, households and national economic performance.
In late February 2026, grid operators confirmed that average daily electricity generation had fallen to approximately 4,300 megawatts (MW), significantly below Nigeria’s installed capacity of over 13,000 MW and insufficient to meet even basic demand nationwide. The primary cause, according to NISO, is inadequate gas deliveries to thermal power plants, which collectively require an estimated 1,629.75 million standard cubic feet (MMSCF) of gas per day to operate at optimal capacity. Actual deliveries on February 23 were reported at just 692 MMSCF per day — roughly 43 per cent of requirements — directly limiting the volume of electricity produced and dispatched to distribution networks. System operators have been compelled to implement load-shedding to prevent wider grid instability.
The persistent gas shortfall reflects deep challenges across Nigeria’s energy value chain. Although the country is rich in natural gas resources, upstream production and delivery systems have frequently failed to supply sufficient volumes to power generators due to a combination of pipeline vandalism, infrastructure constraints, financial bottlenecks, and contractual disputes. Analysts note that pipeline attacks and maintenance issues have intermittently disrupted flows, while outdated transmission infrastructure further constrains the system’s ability to absorb and deliver electricity.
Recent historical data highlight the severity of the grid’s fragility. In December 2025, a major system collapse occurred against a backdrop of vandalism on the Lagos-Escravos-Lagos gas line, which cut critical supply to generating plants and prompted rapid declines in available generation. At one point during that disturbance, total grid generation plunged from over 2,000 MW to under 150 MW within a single hour, leaving most distribution companies without meaningful supply. Efforts by the grid operator to isolate and restart sections of the system restored minimal capacity to some regions, but the incident illustrated the vulnerability of the network to fuel and infrastructure disruptions.
These recurring failures have become a pattern rather than an anomaly. Partial and total grid collapses have been reported with increasing frequency over recent years, with both gas shortages and transmission constraints cited as major drivers. The electricity sector’s structural weaknesses are compounded by an enduring lack of investment, outdated equipment, and weak commercial performance throughout the value chain, including generation companies (GenCos), transmission infrastructure and distribution networks (DisCos).
The prevailing dependence on gas-fired thermal generation — which constitutes more than three-quarters of Nigeria’s on-grid generation — amplifies the impact of supply disruptions. When gas deliveries falter, turbines slow or shut down, reducing available power output and triggering cascading effects across the grid. Beyond immediate operational challenges, long-standing financial disputes have further constrained performance. Multiple reports indicate that cumulative sector debts, particularly those owed to gas suppliers and within Power Purchase Agreements, have ballooned to unsustainable levels, depressing investment incentives and eroding confidence amongst producers and service providers.
Market design issues also contribute to instability. Generation companies have warned that non-recognition of capacity payments under current market rules, along with significant unpaid invoices, threaten the commercial viability of electricity production and could lead to stranded capacity of thousands of megawatts. When generation companies cannot recover costs or secure timely payment, their ability to maintain existing plants or invest in new capacity deteriorates, exacerbating supply constraints.
Complicating the picture further, distribution challenges — including theft, non-payment by consumers, and unmetered billing — erode the revenue base for DisCos and limit their capacity to invest in grid upgrades or expand service coverage. The Multiyear Tariff Order framework, intended to stabilise pricing and encourage private sector engagement, has not fully mitigated these issues, leaving networks underfunded and vulnerable to strategic default.
Nigeria’s federal authorities have acknowledged these systemic issues and pledged incremental reform. Official statements from the Federal Ministry of Power outline plans to modernise grid infrastructure, expand metering, and improve accountability within the sector, alongside broader energy transformation strategies. Initiatives such as the deployment of off-grid mini-grids and solar hybrid plants are progressing, particularly in rural and underserved areas. However, energy experts emphasise that such measures complement but do not replace the need for foundational reforms to the gas supply chain and the national grid’s operational architecture.
Investment in ancillary technologies — such as supervisory control and data acquisition (SCADA) systems — and improvements in pipeline integrity and security are often cited as prerequisites for enhancing grid resilience. Without robust real-time monitoring and control, grid operators face significant limitations in balancing generation and demand, increasing the risk of partial or full system failures. Historic underinvestment in such technologies has left the grid less responsive to abrupt changes in supply or demand, magnifying the impact of any single disruption.
The social and economic toll of Nigeria’s power crisis is multifaceted. Persistent outages disrupt healthcare services, education, digital connectivity and manufacturing output, inflicting annual economic costs estimated in the billions of dollars. Small and medium enterprises, which form a significant portion of the economy, incur additional expenses through reliance on diesel and petrol generators, contributing to persistent inflationary pressures in energy-intensive sectors. In metropolitan centres, households face prolonged periods without electricity, exacerbating energy poverty and widening inequality between urban and rural communities.
Efforts by individual energy firms to mitigate these challenges have yielded mixed results. In Aba, for example, independent operator Geometric Power succeeded in restoring uninterrupted supply from its 188 MW facility after securing alternative gas supplies, demonstrating that targeted interventions can provide localized relief. Such examples underscore the potential of private sector resilience when effective supply arrangements are in place but also highlight the uneven nature of electricity access across the nation.
Looking ahead, policy analysts argue that diversifying Nigeria’s energy mix — including accelerated deployment of renewables and decentralised generation — could reduce reliance on gas and strengthen grid stability. Nonetheless, without addressing the immediate structural bottlenecks in gas production, infrastructure security and financial viability across the power sector, Nigeria’s national grid is expected to remain vulnerable to recurrent supply shocks.
Stone Reporters note that while incremental improvements and targeted initiatives offer short-term relief, systemic change — backed by sustained investment, regulatory clarity and collaboration between government and private stakeholders — is essential to transform Nigeria’s energy landscape and deliver reliable electricity for its fast-growing population.
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