FG to unveil power sector scorecards, may sanction underperforming DisCos, GenCos

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The Federal Government (FG) is set to introduce performance scorecards for operators across Nigeria’s electricity value chain, with underperforming distribution and generation companies (DisCos and GenCos) to face sanctions while high-performing operators will be rewarded.

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Meanwhile, Nigerians spent an estimated N16.5 trillion on self-generated electricity in 2023, compared with about N1 trillion in revenue generated by the national grid, underscoring the enormous economic cost of Nigeria’s unreliable power supply.

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The Minister of Power, Joseph Olasunkanmi Tegbe, disclosed this in a policy brief presented by his Special Adviser, Martins Olajide, at the Nigerian Economic Summit Group (NESG) Industrialisation and Competitiveness Forum on Wednesday.

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Tegbe said the ministry would introduce performance scorecards for power sector personnel, DisCos and GenCos as part of efforts to strengthen accountability and enforce clear performance standards across the electricity value chain.

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According to him, the framework will reward excellence and penalise underperformance, thereby restoring discipline and improving service delivery in the sector.

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He also announced plans for tariff reforms aimed at protecting vulnerable consumers while ensuring that electricity supply obligations are met across the value chain.

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The minister said the measures formed part of the ministry’s eight-point agenda to stabilise the power value chain, restore market discipline and strengthen governance.

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He noted that Nigeria currently has 13,625 megawatts (MW) of installed grid capacity, but average daily available capacity is only 4,854MW, leaving about 62 per cent of installed capacity idle.

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This, he said, was occurring despite realistic peak electricity demand of about 20,000MW.

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“The power arithmetic does not add up,” Tegbe said, stressing that the persistent gap between available supply and demand had forced households and businesses to increasingly rely on self-generation.

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He stated: “Nigerians spent an estimated N16.5 trillion on self-generated electricity in 2023, compared with about N1 trillion in revenue generated by the national grid.”

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Citing World Bank estimates, Tegbe said inadequate electricity supply costs the Nigerian economy about $25 billion annually, equivalent to between five and seven per cent of Gross Domestic Product (GDP).

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“Improving the performance of electricity operators and reforming tariffs were critical to creating a reliable power market capable of supporting industrialisation and boosting productivity,” he stated.

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The minister said the government would also strengthen existing power infrastructure and improve the utilisation of assets across the value chain.

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According to him, the ministry plans to enhance the Lagos, Enugu-Port Harcourt and Abuja-Kaduna-Kano transmission corridors, with the Lagos corridor serving as a proof of concept for the broader grid stabilisation programme.

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