Federal Government Unveils $100 Billion Power Sector Investment Plan
The Federal Government has announced that Nigeria requires a staggering investment exceeding $100 billion from both public and private sources to establish a consistent 24-hour electricity supply nationwide. This revelation came during a press briefing where Power Minister Adebayo Adelabu addressed the recent deterioration in power availability across the country.
Minister Apologizes and Details Funding Requirements
Minister Adelabu expressed regret to Nigerians for the ongoing electricity shortages and pledged immediate corrective measures. He elaborated that the colossal $100 billion figure encompasses investments across the entire power sector value chain, including upstream, midstream, and downstream components.
"Collectively, we are discussing investments surpassing $100 billion in the power sector's value chain," Adelabu stated. "This is not an insignificant amount, but it is attainable through phased implementation involving both government and private sector collaboration. Consistency and patience in investment are crucial."
Breakdown of Investment Costs
The government has meticulously calculated the financial requirements:
- Adding 20,000 megawatts of generation capacity is projected to cost approximately $30 billion, based on an average of $1.5 billion per 1,000MW plant.
- Transmission infrastructure to distribute this power is estimated at $20 billion.
- Distribution network enhancements would require around $25 billion.
- Gas pipeline development is budgeted at $22 billion.
Comparative Analysis and Recent Achievements
Adelabu highlighted that while South Africa, with a population of 60 million, is contemplating a $25 billion private energy investment, Nigeria's population exceeding 200 million necessitates proportionally greater investment. Despite current challenges, the minister underscored significant progress since the administration began in September 2023.
"For the first time in Nigeria's history, we reached a generation peak of 6,001 megawatts in April 2025 and a transmission peak of 5,801 megawatts on March 2, 2025," he reported. These milestones were achieved through the completion of the Zungeru hydroelectric plant (700MW), rehabilitation of existing thermal plants, and expansion of renewable energy via mini-grids.
Capacity and Financial Improvements
Installed capacity increased from 13,000MW in 2023 to 14,400MW in 2025. Financial interventions included a N4 trillion debt restructuring to settle unpaid subsidies to power-generating companies, with N501 billion already raised from bond markets and disbursed.
The introduction of cost-reflective tariffs for approximately 15% of consumers significantly boosted sector revenue. "Revenue grew from N1 trillion in 2023 to N2.3 trillion in 2025," Adelabu noted. "This enabled payments to generation companies to rise from 9% to between 35% and 40% of invoices, substantially reducing government subsidy needs."
Infrastructure Upgrades and Grid Stability
The minister emphasized a phased approach to infrastructure upgrades across various categories, gradually expanding 24/7 electricity coverage. "By progressively migrating customers to upgraded infrastructure, we can achieve 60–70% coverage within a few years," he asserted.
Nigeria's national grid capacity has increased to 8,500 megawatts from 5,000MW in 2023, with a target of 15,000MW within three years upon completion of ongoing projects, including the Presidential Power Initiative. Grid collapses have decreased from an average of 12–15 annually to just four over the past two and a half years, demonstrating the tangible impact of transmission and substation investments.
Gas Supply Constraints Identified
Adelabu attributed recent power shortages primarily to gas supply issues affecting 75% of Nigeria's gas-fired plants. "Even the most advanced turbines cannot operate without raw materials," he explained. Global gas shortages due to the Middle East crisis, local supply obligations, outstanding payments to gas suppliers, and pipeline repairs have all contributed to the generation decline.
Currently, only two out of 32 power plants have firm gas supply contracts, with the remainder relying on irregular, best-effort supplies. The minister called for coordinated action among stakeholders, urging structured cooperation between the Ministries of Power, Petroleum, Water Resources, and Environment.
Long-standing Challenges and Future Vision
Nigeria's power sector has long grappled with entrenched and operational challenges, including inadequate gas supply, aging equipment, transmission issues, and persistent financial instability throughout the industry.
Concluding his address, Adelabu reaffirmed the ministry's objective: "We regard 24/7 electricity not as a final destination but as an ongoing process. Through strategic phased investments, enhanced collaboration, and private sector involvement, Nigeria can ensure every citizen enjoys a stable and reliable power supply."
