Precious Anga
Lagos — Nigeria’s electricity industry remains trapped in structural stagnation, with total generation still hovering around 4,000 megawatts more than a decade after privatisation, according to the President of the Nigeria Labour Congress (NLC), Joe Ajaero, who has described the sector as “the biggest scam in the country.”
Ajaero made the remarks while reviewing the state of the power sector in an interview, where he argued that reforms, unbundling of the Power Holding Company of Nigeria (PHCN), and the sale of successor companies have failed to deliver meaningful expansion in capacity or stable electricity supply.
He said the problem in the sector cannot be isolated to generation, transmission, or distribution, stressing that all three segments are structurally misaligned and incapable of delivering reliable power in their current state.
According to him, Nigeria’s grid remains constrained by a capacity ceiling that has barely moved since the PHCN era.
“It is scandalous and criminal that the total capacity today is still about 4,000 megawatts,” Ajaero said.
He noted that even when generation improves marginally, transmission bottlenecks and weak distribution networks immediately erase the gains, creating a cycle of instability that consumers continue to bear.
Ajaero also challenged the logic behind Nigeria’s 2013 power privatisation, arguing that it was never designed to expand capacity but to redistribute control of an already weak system.
He maintained that the DisCos currently serving different regions are still operating on inherited infrastructure without significant expansion of generation assets.
The labour leader pointed out that the sector’s structure has remained largely unchanged since the breakup of PHCN, despite billions of naira in investments and tariff adjustments over the years.
He further criticised the absence of a coordinated national master plan for electricity development, saying policy inconsistency has allowed private operators to prioritise revenue collection over system expansion.
Ajaero also questioned the sustainability of Nigeria’s current tariff structure, including the Band A–C classification, arguing that it has deepened inequality in access to electricity.
He said the system effectively prioritises urban, higher-paying customers while leaving rural communities with little or no supply.
Beyond pricing and structure, Ajaero raised concerns about ownership and financing within the sector, alleging that many distribution companies are now effectively controlled by banks due to loan defaults tied to their acquisition.
According to him, several DisCos were purchased using borrowed funds from Nigerian banks rather than genuine equity capital, a development he said has weakened operational efficiency and deepened financial instability in the sector.
He added that repeated changes in ownership and management within the DisCos have not translated into improved performance, but instead have led to further layoffs, labour disputes, and rising tariffs.
Ajaero also criticised the continued use of government subsidies in the power sector, questioning why public funds are now being used to sustain a system that was originally privatised to reduce government burden.
He said the contradiction highlights deeper structural flaws in the reform process, which has failed to attract strong technical operators or long-term infrastructure investors.
On energy planning, he argued that Nigeria’s heavy reliance on gas-fired generation remains inefficient, especially when the country has underutilised alternative energy sources such as coal and hydro.
He insisted that without a diversified energy mix and deliberate expansion of installed capacity, Nigeria will continue to struggle with unstable supply, regardless of reforms or tariff adjustments.
Ajaero also warned against what he described as regulatory capture, alleging that powerful interests within the sector influence key appointments and policy decisions.
He said this has weakened independent regulation and slowed meaningful reform efforts.
Despite repeated government initiatives and policy shifts, Nigeria’s power supply has remained largely stagnant, with millions of households and businesses still relying on generators to bridge persistent gaps in electricity access.
This article was originally posted at sweetcrudereports.com
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