Nigerian manufacturers spent N1.34tn on alternative electricity sources in 2025 as persistent power outages forced factories to rely increasingly on diesel generators, gas and other off-grid energy solutions to sustain production.

Data from the Manufacturers Association of Nigeria (MAN) obtained by The PUNCH showed that manufacturers’ spending on alternative power increased by about 21 per cent, rising from N1.11tn in 2024 to N1.34tn in 2025.

The latest increase highlights the growing cost of unreliable electricity supply to Nigeria’s industrial sector, with manufacturers increasingly bearing the financial burden of generating the power needed to keep their factories running.

Manufacturers’ Power Costs Surge

MAN data showed that expenditure on alternative electricity has risen significantly over the past decade, despite fluctuations in some years.

Manufacturers spent N25bn on alternative power in 2014, with the figure rising to N59bn in 2015 and N129.95bn in 2016.

The expenditure fell to N117.4bn in 2017 and declined further to N93.11bn in 2018 and N61.38bn in 2019.

Spending rose to N81.91bn in 2020 before dropping to N71.22bn in 2021.

However, the cost began rising sharply from 2022, reaching N144.5bn that year. It surged to N781.7bn in 2023 before crossing the N1tn mark at N1.11tn in 2024.

By 2025, manufacturers’ alternative power bill had climbed further to N1.34tn.

The development has raised concerns about the competitiveness of Nigerian manufacturers, particularly as businesses continue to face weak consumer purchasing power and pressure on operating margins.

Grid Power Supply Drops

MAN, led by Segun Ajayi-Kadir, said grid reliability deteriorated significantly in 2025.

According to the association, average daily power supply dropped from 16.7 hours in the first half of 2025 to 13.1 hours in the second half of the year.

The decline has increased manufacturers’ dependence on alternative energy sources, adding substantially to production costs.

Industry stakeholders have continued to call for more reliable electricity supply and increased investment in alternative energy infrastructure to reduce dependence on expensive diesel-powered generation.

Manufacturers Turn Away From DisCos

Many manufacturers are reportedly reducing their reliance on electricity distribution companies, popularly known as DisCos, by deploying gas and low-pour fuel oil (LPFO) to power their production facilities.

The shift is aimed at reducing losses caused by power interruptions during manufacturing operations.

According to the Nigerian Electricity Regulatory Commission (NERC), several major companies have obtained permits or licences to generate electricity for their operations.

They include Dangote Industries Limited, Flour Mills of Nigeria Plc, Lafarge Africa, Nigerian Breweries Plc, Cadbury Nigeria Plc, Procter & Gamble Nigeria Limited, Seven-Up Bottling Company Plc, Dangote Cement Plc, Guinness Nigeria Plc, Nestlé Nigeria Plc, Unilever Nigeria Plc and Mikano International Limited, among others.

Pure Flour Mills Limited in Rivers State obtained a licence to generate 546MW of electricity in 2025, according to NERC.

Dangote Industries Limited also generated about 1,500MW of electricity in 2025, according to Aliko Dangote. The Dangote Refinery alone operates a 435MW power plant, with capacity capable of meeting the total power requirement of the Ibadan Electricity Distribution Company, based on the comparison cited in the report.

Other companies with generation capacities include United Cement Company of Nigeria Limited with 105MW, Flour Mills of Nigeria Plc with 70MW and Lafarge Cement WAPCO Nigeria Plc with 90MW.

The growing investment in captive and alternative power generation underscores the extent to which unreliable grid electricity continues to affect Nigeria’s manufacturing sector.

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Abuja Electricity Distribution Plc (AEDC) has clarified that the ongoing electricity outages affecting Lafia, Keffi, Nasarawa, Masaka, and surrounding communities in Nasarawa State are largely due to factors beyond its control.

The company cited limited power allocations from the national grid, compounded by seasonal and infrastructural challenges, as the primary reasons for the extended disruptions.

In a statement released on Wednesday, AEDC highlighted that power allocations to Lafia have recently hovered between 5MW and 10MW, far below the demand required to meet the needs of residents, businesses, and government institutions in the state capital and adjoining areas.

“The Management of Abuja Electricity Distribution Plc (AEDC) wishes to inform our valued customers in Lafia, Keffi, Nasarawa, Masaka, and other affected communities that the current supply constraints are largely due to national-level factors beyond our direct control,” the statement read.

According to AEDC, Nigeria’s power sector experiences significant limitations during the dry season, which typically runs from November to April. During this period, hydropower generation declines due to low dam water levels, while several thermal plants face reduced gas supply caused by pipeline vandalism, operational disruptions, and broader supply-chain issues. These factors collectively result in lower overall electricity generation, reducing the amount of power available for distribution companies across the country, including AEDC.

The company also explained that disruptions in gas supply and system limitations have occasionally led to dramatic drops in allocations from the national grid, affecting energy availability for end-users. “Despite our efforts, power allocations have at times been insufficient to meet the growing demand, creating frustrations for our customers,” AEDC said, emphasizing its commitment to transparency and accountability in communicating these challenges.

AEDC assured that, where possible, it has increased supply to Lafia to approximately 10MW, even as pressures from neighboring regions and national limitations persist. The company also called for cooperation among stakeholders, including generation companies, gas suppliers, regulators, and DisCos, to ensure that electricity supply stabilizes across affected regions.

The ongoing outages have sparked concerns among residents and businesses, who face extended periods without electricity, affecting both domestic life and commercial activities. Energy experts argue that these recurring shortages underline structural weaknesses in Nigeria’s power sector, highlighting the need for improved coordination, investment in infrastructure, and proactive planning to address growing urban energy demands.

“The current power situation is not only a technical challenge but also a socioeconomic one,” said an energy analyst who requested anonymity. “Limited electricity availability in fast-growing states like Nasarawa impacts productivity, disrupts business operations, and can stall economic growth if prolonged.”

AEDC further clarified that the outages are not due to mismanagement at the distribution level but are symptomatic of systemic issues affecting Nigeria’s energy supply chain. This includes insufficient gas deliveries, operational downtime at generation plants, and inadequate maintenance of transmission infrastructure.

For residents in affected areas, the company urged patience and understanding, stressing that solutions require national-level interventions and coordinated responses from multiple stakeholders. AEDC said it remains committed to restoring consistent power supply wherever possible and is actively monitoring grid allocations to maximize available energy.

The situation in Nasarawa serves as a reminder of broader national challenges in the power sector, where seasonal variations, infrastructural deficits, and supply-chain vulnerabilities can create significant disruptions for consumers. Analysts recommend that federal and state governments prioritize investment in energy infrastructure, enhance monitoring systems, and promote greater collaboration between gas suppliers, power generators, and distribution companies.

AEDC reaffirmed its empathy with customers affected by the outages, noting that while the company strives to provide reliable electricity, addressing systemic power sector challenges requires collective action. For now, residents and businesses in Lafia, Keffi, Nasarawa, and Masaka must navigate ongoing constraints while awaiting coordinated national-level interventions to stabilize supply and support economic activity.

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Electricity workers under the National Union of Electricity Employees (NUEE) have issued a 21-day nationwide strike notice to the Federal Government over alleged wage violations, non-remittance of statutory deductions, and worsening labour conditions in the Nigerian Electricity Supply Industry (NESI).

The union warned that failure to address the concerns within the stipulated period could trigger industrial action capable of disrupting electricity generation and distribution across the country.

Union Accuses DISCOs, GENCOs of Labour Violations

In a letter dated January 26, 2026, and addressed to the Minister of Power, NUEE’s Acting General Secretary, Igwebike Dominic, expressed frustration over what he described as persistent anti-labour practices since the privatisation of the electricity sector more than a decade ago.

According to the union, several power generation companies (GENCOs) and distribution companies (DISCOs) have failed to negotiate or implement collective agreements and conditions of service.

The workers also alleged non-implementation of the 2025 National Minimum Wage Act and its consequential adjustments across parts of the sector.

Non-Remittance of PAYE, Pension Contributions

NUEE further accused employers in the power sector of deducting Pay As You Earn (PAYE) tax, pension contributions, and union dues without remitting them to the appropriate authorities.

The union claimed that pension deductions in some distribution companies have remained unpaid for extended periods, in certain cases spanning several years.

This, according to the workers, exposes employees to long-term financial uncertainty and undermines trust in the pension system.

Restriction of Union Activities

The union also alleged that some companies have restricted workers’ constitutional rights to unionise and engage in collective bargaining.

It stated that union activities are allegedly prohibited within company premises, while deducted union dues are not remitted.

NUEE described the situation as a violation of labour laws and freedom of association guaranteed under the Constitution.

Tariffs Up, Workers’ Welfare Stagnant

Electricity workers argued that despite repeated electricity tariff increases and band reclassifications, employees have not benefited from improved welfare packages.

According to the notice, there have been no promotions, salary increments, or bonuses, even as revenues to power companies have reportedly increased.

The union noted that workers often face public frustration over poor electricity supply while operating under what it termed difficult and insecure working conditions.

Privatisation Under Scrutiny

The union also criticised investors in the electricity sector, alleging failure to meet post-privatisation commitments such as capital injection, improved metering, network expansion, and enhanced power supply.

It described the situation as a reflection of systemic challenges within NESI and called for urgent government intervention.

Call for Federal Government Action

NUEE urged the Federal Government to convene stakeholders to resolve the crisis within 21 days of receipt of the letter.

The union warned that failure to address the grievances may compel workers to deploy legitimate labour actions permitted under Nigerian labour laws.

The strike notice raises concerns about potential disruptions in Nigeria’s already fragile power sector if negotiations fail.

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Nigeria’s electricity subsidy rose to ₦1.05 trillion in the first half of 2025, almost equal to the ₦1.12 trillion revenue earned by the nation’s 11 electricity distribution companies (DisCos). A Proshare Research report shows a sector burdened by rising costs and unsustainable subsidies.

The subsidy, meant to make tariffs affordable, continues to drain public funds and discourage private investment. Despite higher tariffs for Band A consumers and improved collection efficiency of 76%, subsidy costs climbed alongside revenue growth.

Liquidity remains tight for every ₦100 billed, about ₦25 is lost to poor remittance, theft, and weak compliance. In July 2025, DisCos recorded a ₦49.18 billion shortfall as tariffs lagged behind real costs.

Metering improved slightly to 54%, yet nearly half of electricity consumers remain unmetered. Generation companies (GenCos) recovered only 28% of debts in 2024, with total sector arrears exceeding ₦4 trillion.

Although President Bola Tinubu approved the securitisation of these debts, rising subsidy bills have eroded the gains. Power generation remains stagnant at 5,396MW, far below the 13,000MW capacity.

The government has introduced major reforms  including the National Integrated Electricity Policy (NIEP), Mission 300, and several multibillion-dollar funding plans but analysts say real progress is still lacking.

“Government efforts are commendable, but results remain on paper,” Proshare noted.

Until deeper structural reforms take hold, Nigeria’s power sector will remain caught in a cycle where every gain is offset by the cost of keeping the lights on.

The post Nigeria’s Power Subsidy Wipes Out DisCos’ Revenue Gains appeared first on Housing TV Africa.

The initiative, part of a pilot restructuring programme, will begin between May and August 2025 and will initially target one Disco each from the northern and southern regions of the country. The selected companies will undergo a comprehensive reform process involving external technical experts and increased federal oversight.

Announcing the initiative in Abuja, Minister of Power Adebayo Adelabu stated that the government could no longer stand by while electricity consumers bear the brunt of poor service. He emphasized that regulatory powers would be used to enforce the reforms, with a focus on restructuring internal operations and ensuring compliance.

“This pilot phase is not optional,” Adelabu said. “We must confront these challenges directly. Discos that fail to meet performance benchmarks will be compelled to cooperate with reform teams.”

According to a statement by the minister’s aide, Bolaji Tunji, the decision follows a strategic collaboration with the Japan International Cooperation Agency (JICA), which presented a roadmap titled “Revamping of the Distribution Sector in Nigeria.” The reform plan was developed following Adelabu’s recent visit to Japan’s energy sector and aims to apply global best practices to Nigeria’s distribution challenges.

A senior official from the Federal Ministry of Power, who spoke on condition of anonymity, said the pilot programme will bring in independent professionals to work side-by-side with the Discos, analyzing their operations and offering practical solutions to recurring inefficiencies. “It’s not a takeover,” the official clarified, “but a collaborative intervention designed to strengthen internal systems and identify gaps.”

The reform targets key issues such as infrastructure deficits, poor governance, and inadequate commercial structures. Experts will help develop models that can later be applied to other Discos across the country. Discos performing relatively well will also benefit from the framework to enhance their operations.

The minister cited a persistent lack of investment in the sector as a major stumbling block. “Investment returns remain unattractive, which discourages infrastructure upgrades,” Adelabu noted. To address this, he directed the Nigerian Electricity Regulatory Commission (NERC) to implement franchising models that will allow smaller, capable operators to manage specific areas.

Adelabu also stressed the importance of public education, noting that many Nigerians still misunderstand the distinctions between power generation, transmission, and distribution. “Consumer awareness is vital if we’re going to build trust and support for these reforms,” he said.

Meanwhile, the Association of Nigerian Electricity Distributors has responded to the restructuring efforts, expressing support for the government’s drive to improve the sector. Executive Director of Research and Advocacy, Sunday Oduntan, stated that the Discos are not concerned with power sector politics but are committed to any initiative that enhances power supply and sectoral growth.

“We are focused on progress,” Oduntan said. “Our collaboration with the government is aimed at increasing electricity distribution, which directly supports economic development and job creation.”

The JICA proposal calls for measurable milestones, enhanced compliance standards, and accountability mechanisms for all participating Discos. The reform is expected to lay the foundation for long-term sector-wide improvements, with the goal of creating a reliable, investor-friendly power distribution landscape in Nigeria.

This marks the most decisive government action since the privatisation of the power sector in 2013, addressing long-standing concerns over operational inefficiencies and the lack of licence reviews in over a decade

The post FG Begins Overhaul of Underperforming Discos, Deploys Team of Experts appeared first on Housing TV Africa.

He explained that the debt burden has significantly hampered the power sector’s ability to provide reliable electricity to Nigerian consumers.

Providing details, he stated that N2 trillion is owed to GenCos as legacy debt, while N1.9 trillion covers 2024 electricity subsidies.

Additionally, electricity distribution companies (DisCos) are owed N450 billion in subsidies for 2024, further straining the sector’s financial stability.

Adelabu stressed that the government can no longer sustain the current electricity subsidy model, necessitating a targeted intervention approach.

He acknowledged that the government must reconsider the electricity tariff structure without necessarily imposing an immediate increase.

Discussing DisCos, he lamented their reluctance to invest in network upgrades, which has hindered customer migration to Band A.

The minister disclosed that the government is reviewing electricity consumer classifications to merge them into three bands: A, B, and C.

This restructuring aims to reduce tariff disparities and improve electricity supply for consumers in lower bands across the country.

The post FG Owes GenCos, DisCos Over N4 Trillion in Electricity Subsidies – Adelabu appeared first on Housing TV Africa.

NERC announced the directive via its social media handles on Monday, promoting transparency and encouraging customer participation.

The announcement followed NERC’s first 2025 NESI Stakeholders’ meeting, addressing critical sector issues, including liquidity and tariffs.

The MAP framework allows third-party investors to provide meters, while customers pay service charges for meter maintenance.

Regulations require Discos to refund customers who paid upfront for meters through energy credits, following NERC’s approved schedule.

Consumer groups reported inconsistent refunds from Discos, prompting NERC’s directive for public refund details on company websites.

“NERC directed Discos to publish MAP refund details online, demonstrating commitment, consistency, and encouraging wider customer participation,” it stated.

Nigeria has over seven million unmetered electricity consumers, prompting the government’s renewed efforts to close the metering gap.

Special Adviser to President Tinubu on Energy, Olu Verheijen, emphasized plans to meter all customers and reduce losses.

Verheijen explained metering ensures accurate consumption records, improves revenue collection, and boosts sector cash flow and reliability.

She mentioned the Presidential Metering Initiative, consolidating various metering projects for enhanced financial sustainability and green access.

“It’s the initial step towards ensuring DisCos maintain necessary cash flows for investments in reliable electricity distribution,” she added.

During NESI’s meeting, stakeholders discussed tariff methodologies, market liquidity, financial assessments, and multi-tier electricity market transitions.

NERC highlighted quarterly meetings as essential for collaborative stakeholder efforts, improving Nigeria’s electricity supply industry nationwide.

The directive and broader metering efforts reflect the government’s commitment to resolving persistent challenges in Nigeria’s power sector.

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The company disclosed this in a statement to its customers on its official X handle.

According to the statement, the system collapsed occurred around 16:28hrs (04:28pm).

However, the company noted that it is currently collaborating with its partners to restore power across its area of operation.

The statement reads,

• “Kindly be informed that there was a system collapse at 16:28 hrs which resulted in loss of power supply across our network.”
• “We are currently working with our partners as we hope for speedy restoration of the grid. We will keep you updated as soon as power supply is restored.”

What you should know

The Eko Distribution Company supplies electricity to the Southern parts of Lagos and the Agbara region of Ogun state. Areas under its jurisdiction include; Lekki, Ibeju, Islands, Orile, Ijora, Apapa, Mushin, Festac, Ojo, Ajah and Agbara.

READ ALSO: Federal Government Threatens to Revoke DisCos Licenses Over Persistent Power Shortage

In total, the company receives about 11% of electricity supplied to the national grid.

System collapse from Discos or the TCN are not new to the Nigeria electricity sector.

The recent system collapse adds to the leadership tussle that has embroiled the company in the past few days. Nairametrics earlier reported that sack of the company’s CEO, Dr. Sanda Tinuade following a directive from the Nigeria Electricity Regulatory Commission (NERC).

READ ALSO: AEDC’s Warning: Aso Rock and 85 Others Face Disconnection Over N47 Billion Debt

Following her sack, the Board announced the appointment of a new acting CEO in Mrs Rekhiat Momoh

However, the Legal director of the company insisted that the sacked CEO remains the Head of the company

The post Black out: Eko Disco announces system collapse of its power network appeared first on Housing TV Africa.

The Minister of Power, Adebayo Adelabu, stated this in a press release on Wednesday in Abuja.

Despite an increase in power generation to 4000MW by generation companies, the ministry remains deeply concerned about the inadequate electricity distribution by the Discos. Minister Adelabu has summoned the chief executives of Abuja Electricity Distribution Company (AEDC) and Ibadan Electricity Distribution Company (IEDC), as well as the Managing Director of the Transmission Company of Nigeria (TCN), to explain the ongoing challenges in power distribution across the country.

“The Ministry has been pressuring the Generating Companies (GENCOs) to improve their performance, leading to a recent increase in generation to over 4000MW,” said Adelabu. “However, certain distribution companies are failing to distribute the power supplied by TCN adequately, while vandalism of power infrastructure exacerbates the problem in regions such as Abuja, Benin, Port Harcourt, and Ibadan.”

READ ALSO: Edo State Assembly Launches Impeachment Proceedings Against Deputy Governor Philip Shaibu

Adelabu emphasized his commitment to holding all distribution companies accountable for their performance, warning that “willful non-performance will not be tolerated, and severe consequences, including license revocation, may be imposed.” He also instructed TCN to prioritize repair works on damaged transmission towers and power lines to improve supply in affected regions.

In addressing the financial challenges faced by power generation and gas supply companies, Adelabu revealed plans to settle outstanding debts, which will alleviate financial strain and contribute to improved generation levels nationwide. He urged electricity consumers to remain patient as efforts are underway to address these issues and provide better service to all Nigerians.

READ ALSO: Federal Government Seizes 141 Trucks in Crackdown on Food Smuggling

Earlier, the Federal Government accused certain electricity distribution companies of intentionally not accepting power supply from TCN, contributing to the persistent power crisis. In response, Adelabu disclosed that the government is preparing to issue queries to underperforming power distribution companies.

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The inadequate provision of electricity is causing distress in the housing sector, with dissatisfaction mounting over the subpar performance of Electricity Distribution Companies (DisCos). In response to the lack of dividends from the DisCos, despite the government holding a 40 percent stake and injecting at least $1.25 billion in the past 12 years, the government is revising its funding strategy for the 11 firms.

Despite numerous financial interventions, electricity supply remains erratic, prompting the government to strip the Bureau of Public Enterprises (BPE) of its control over its shares in the DisCos. The Ministry of Finance Incorporated (MOFI), mandated by law to manage government assets, will now oversee the government’s 40 percent stake.

READ ALSO: Old Court Zuba Residents Cry Out for help after years of Neglect Over Lack Of Electricity and Water

A Ministry of Finance official expressed the government’s deep frustration, emphasizing the absence of dividends since 2012 despite substantial financial support. The official cautioned that this financial shortfall could jeopardize the ambitious $1 trillion economy projection outlined by President Bola Ahmed Tinubu.

Highlighting the necessity of a reliable power supply for economic growth, the official stated, “You cannot double your rate of growth of Gross Domestic Product (GDP) and increase your base to $1 trillion without power.”

To enhance accountability and spur reform in the power sector, the government has removed the BPE’s authority over government shares in the DisCos. The move aims to identify and address the fundamental issues plaguing the sector.

While a House of Representatives investigation is underway into the $1.25 billion government fund in the DisCos with no dividends, the government remains committed to its partnership with the DisCos. The focus is on identifying and resolving issues to positively transform the situation rather than withdrawing from the partnership.

Despite numerous interventions, including the N300 billion Power and Airlines intervention and the National Mass Metering Programme (NMMP), challenges persist in achieving a reliable and consistent power supply. The government’s multifaceted approach underscores its commitment to revitalizing the power sector and ensuring access to dependable electricity for Nigerians.

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