Nigeria’s power generation companies have raised fresh concerns over the growing financial challenges facing the electricity sector, warning that increasing debt obligations and stranded generation capacity continue to threaten the industry’s sustainability.

Industry operators said the sector has recorded an additional debt burden estimated at ₦1 trillion, adding to longstanding liabilities that have accumulated over the years. They noted that persistent payment shortfalls across the electricity value chain have placed significant pressure on generation companies, limiting their ability to meet operational and financial obligations.

The companies also expressed concern over stranded power capacity valued at approximately ₦2.376 trillion. According to industry stakeholders, stranded power refers to electricity generation capacity that remains underutilised due to transmission, distribution, and market constraints despite investments made to increase production capacity.

Power producers argued that the continued inability to fully evacuate and distribute generated electricity has resulted in substantial financial losses while discouraging further investment in the sector. They maintained that significant resources have been committed to expanding generation capacity, yet much of the available power cannot reach end users because of infrastructure limitations.

Stakeholders further highlighted the broader liquidity crisis affecting the Nigerian Electricity Supply Industry, noting that outstanding invoices, foreign exchange pressures, and rising operational costs have continued to weaken the financial position of generation companies. Industry figures indicate that debt owed to power producers has risen sharply over the years, creating challenges for plant maintenance, gas procurement, and future investments.

The Association of Power Generation Companies has repeatedly called for urgent intervention to address payment backlogs and improve market efficiency. Industry leaders believe that resolving the debt burden and eliminating constraints responsible for stranded capacity would significantly improve electricity supply and attract fresh investment into the sector.

Experts have also stressed the need for stronger coordination across the generation, transmission, and distribution segments of the electricity market. They argue that without improvements in infrastructure and market settlement mechanisms, Nigeria may continue to face challenges in fully utilising its installed power generation capacity despite growing demand for electricity.

As discussions on sector reforms continue, power producers remain hopeful that government-led initiatives aimed at addressing outstanding liabilities and improving liquidity will provide relief and support long-term stability within the electricity industry.

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Nigeria’s electricity sector is facing renewed pressure after fresh data revealed that only a handful of power plants are currently generating electricity for the national grid.

Latest operational figures released by the Nigerian Independent System Operator show that most power stations connected to the country’s transmission network were offline as of Friday afternoon.

The data indicates that out of more than 30 power plants linked to the national grid, only eight were producing electricity, while the rest recorded zero output.

This development highlights the persistent instability in Nigeria’s electricity supply chain, which continues to struggle with inadequate generation capacity, fuel supply challenges, and infrastructure limitations.

Generation Drops to Just Over 1,200MW

Operational checks on the system operator’s portal around 13:00 hours showed that the eight active plants generated a combined total of approximately 1,212 megawatts (MW).

Hydropower facilities accounted for the largest share of electricity production during the period.

The Kainji Hydroelectric Power Station generated about 425MW, while Zungeru Hydroelectric Power Station contributed roughly 299MW to the grid.

Similarly, the Shiroro Hydroelectric Power Station supplied around 274MW, reinforcing the heavy reliance on hydropower generation during periods when gas-fired plants are underperforming.

Together, the three hydro facilities accounted for the bulk of electricity available on the national grid.

Gas Plants Record Weak Output

Gas-fired plants, which traditionally provide a major portion of Nigeria’s electricity supply, delivered relatively low generation levels during the reporting period.

Among them, Paras Energy generated about 103MW, while Omoku Power Plant and Olorunsogo Power Plant produced roughly 31.5MW each.

The Omotosho Power Plant added about 31.2MW to the grid.

However, several major thermal stations recorded zero electricity generation, further worsening supply constraints.

These include the Egbin Power Station, Azura‑Edo Power Plant, Delta Power Station, Geregu Power Plant, Ibom Power Plant, and Okpai Power Plant.

Several facilities under the National Integrated Power Project (NIPP) programme also recorded no generation during the period.

Structural Challenges in the Electricity Sector

Industry analysts say the persistent shutdown of power plants reflects deep structural and operational challenges within Nigeria’s electricity sector.

According to system operators, the outages affecting thermal and gas-powered plants are linked to several factors including:

• disruptions in natural gas supply

• maintenance shutdowns

• transmission bottlenecks

• financial constraints affecting generation companies

The Nigerian grid also suffers from weak infrastructure and limited investment in generation and transmission capacity.

Demand Far Above Available Supply

Nigeria’s electricity demand has continued to grow due to population expansion, urbanisation and increasing industrial activities.

Energy experts estimate that the country requires more than 20,000MW of electricity to meet national demand effectively.

However, the grid typically supplies between 3,000MW and 5,000MW under normal operating conditions.

When generation levels fall below 1,500MW, analysts warn that the country faces a high risk of large-scale load shedding and widespread blackouts across multiple states.

Gas Supply Disruptions Worsen Crisis

The recent drop in generation has also been linked to disruptions in gas supply to thermal power plants.

Earlier this year, the Nigerian National Petroleum Company Limited announced a temporary decline in gas deliveries to several power plants due to scheduled maintenance operations carried out by its joint-venture partner Seplat Energy.

The maintenance exercise, which took place between February 12 and February 15, affected fuel supply to several electricity generation companies.

Since gas-fired plants account for a large portion of Nigeria’s electricity production capacity, any disruption in supply significantly reduces generation output.

Stakeholders Call for Urgent Reforms

Energy sector stakeholders have repeatedly called for urgent reforms to stabilise Nigeria’s electricity market.

Experts say long-term solutions must include:

• improved gas supply agreements

• stronger investment in generation infrastructure

• cost-reflective electricity tariffs

• better revenue collection across the power value chain

The government is also pursuing broader energy reforms, including a new gas development strategy aimed at boosting domestic production.

Recently, the NNPC Limited unveiled its Gas Master Plan 2026, which targets 10 billion cubic feet of gas production per day to support industrial growth and strengthen Nigeria’s energy security.

However, analysts warn that without coordinated improvements across generation, transmission and distribution networks, the national grid may continue to face frequent disruptions.

The post Nigeria’s Power Grid Under Pressure as Most Power Plants Remain Offline appeared first on Housing TV Africa.