Nigeria’s power sector revenue is projected to reach ₦2.4 trillion by the end of 2025, following significant tariff adjustments and ongoing reforms aimed at restoring liquidity and attracting investment into the industry.
Minister of Power, Adebayo Adelabu, disclosed this at an economic summit in Abuja on Monday, noting that the government’s reform measures have strengthened the financial position of distribution and generation companies, while also improving efficiency across the electricity value chain.
According to Adelabu, revenue in the sector rose by 70 percent in 2024 following tariff realignments for urban consumers and is expected to grow by another 41 percent in 2025.
“Recent tariff adjustments have strengthened revenue in the sector, rising by 70 percent in 2024, with projections to grow another 41 percent to ₦2.4 trillion ($1.6 billion) by year’s end,” Adelabu said.
He explained that the improved financial performance would enable operators to reinvest in critical infrastructure, expand network capacity, and reduce the frequency of system collapses that have plagued the national grid for years.
Nigeria’s electricity sector has historically faced structural challenges, including inadequate transmission capacity, high technical losses, and poor liquidity.
Despite an installed generation capacity of about 13 gigawatts, the grid often transmits less than half of that, leading to persistent power outages that hamper economic growth.
The Minister emphasised that ongoing reforms under President Bola Tinubu’s administration — including the fuel subsidy removal, foreign exchange market liberalisation, and naira-for-crude policy — are beginning to yield results, with fiscal pressures easing and macroeconomic stability improving.
He added that the power sector reforms are designed to attract more private investment, enhance transparency, and improve service delivery to both industrial and residential consumers.
Adelabu also noted that the Federal Executive Council has approved a $2 billion financing plan with China’s Export-Import Bank to develop a national super grid, which will strengthen transmission links between the eastern and western regions and provide reliable power to major industrial hubs.
“Our focus is on modernising the power infrastructure, ensuring steady supply to manufacturing zones, and building the financial sustainability required to support long-term growth,” he said.
Industry analysts have described the improved revenue outlook as a potential turning point for the sector, which has struggled with high debt levels and inconsistent regulatory enforcement since the 2013 privatisation of power assets.
If sustained, the new financial trajectory could support network expansion, encourage new investment in generation capacity, and reduce dependence on costly self-generation, which currently accounts for nearly half of Nigeria’s total electricity consumption.
