1.0 Preamble
Fifteen years after Nigeria renewed its power-sector reform agenda, the industry presents a mixed record of institutional change, private investment and persistent underperformance. The 2013 transfer of generation and distribution companies ended the old vertically integrated public monopoly, but ownership reform did not automatically create a liquid, dependable or self-sustaining electricity market. Weak metering, inadequate networks, gas and transmission constraints, tariff uncertainty, poor payment discipline and blurred institutional mandates continue to limit performance. The Electricity Act 2023 has now opened a second reform frontier by decentralising intrastate electricity regulation, expanding room for private participation and requiring clearer coordination among federal and state institutions.
This op-ed argues that Nigeria’s next gains will come less from another grand restructuring than from harvesting practical, achievable reforms: properly delineating policy, regulatory and commercial roles; enforcing contracts and payment discipline; accelerating universal metering; linking tariffs to objectively measured quality of service; protecting affordability through targeted support rather than broad underpricing; and combining decentralised solutions with regional cooperation and economies of scale. It further contends that investment and consumer welfare are complementary when credible regulation lowers risk, reliable supply displaces costly self-generation and prices reflect value delivered.
Against this background, Dr. Joy Ogaji’s decade as Chief Executive Officer of the Association of Power Generation Companies offers a useful lens through which to assess the leadership, advocacy and institutional discipline needed to convert reform promises into measurable outcomes. The central message is straightforward: Nigeria already understands many of the sector’s problems and remedies; what is still needed is clarity, accountability and sustained execution to deliver reliable, affordable and investable electricity.
2.0 The Privatisation Journey: From Asset Transfer to Market-Building, 2011–2026
Nigeria entered 2011 with the legal architecture for reform already in place and the 2010 Power Sector Roadmap providing renewed political direction. The immediate task was to complete the unbundling of the Power Holding Company of Nigeria, create a credible tariff and market framework, and prepare successor companies for private investment. The Multi-Year Tariff Order introduced a more systematic approach to pricing, while the Nigerian Bulk Electricity Trading Company was designed to support power purchases during the transition. In November 2013, the government transferred five generation companies and ten distribution companies to private investors; the Transmission Company of Nigeria remained publicly owned. That handover changed ownership, but it did not by itself resolve weak metering, high losses, gas constraints, insufficient transmission capacity, non-cost-reflective tariffs or poor payment discipline. The Transitional Electricity Market began in 2015, yet persistent shortfalls required government interventions, market-support facilities and periodic restructuring of distressed distribution companies.
The journey then shifted from privatisation as an asset sale to reform as market-building. Regulators revised tariffs, expanded metering programmes and introduced service-based pricing, while the sector struggled to convert installed capacity into reliable supply and cash. The Electricity Act 2023 opened a new phase by allowing states to set up electricity markets and regulators, thereby moving Nigeria toward a more decentralised system. By 2026, the sector had also begun separating system and market operation from the Transmission Company of Nigeria through the Nigerian Independent System Operator.
The result is a hybrid industry: generation and distribution are largely privately operated; transmission is still publicly owned; federal and state regulators share an evolving space; and public finance continues to stabilise a market that is not yet fully sustaining. Fifteen years on, privatisation created institutions, attracted capital and expanded installed capacity, but its unfinished agenda is still commercial discipline, credible regulation, stronger networks, correct metering and service that consumers can trust and afford.
3.0 The Low-Hanging Fruit: Governance, Viable Pricing and Market Discipline
Turning around the power sector begins with good governance. The challenge is not simply that Nigeria needs more generation capacity. It is that the entire electricity value chain must work within a governance framework that provides accountability, clear responsibilities and incentives for efficiency.
Good governance also requires a proper delineation of roles among policy, regulatory and commercial institutions. Government should set policy and strategic direction; independent regulators should make and enforce rules transparently; and commercial institutions should work, invest and bear responsibility for performance without political interference or regulatory overreach. Clear boundaries would reduce conflicting mandates, strengthen accountability and allow each institution to be judged against the responsibilities it controls.
The decentralisation of electricity-sector governance is therefore a welcome development. It creates opportunities for states and subnational governments to develop electricity solutions reflecting local demand, resources and economic circumstances. But decentralisation must not create regulatory fragmentation without corresponding efficiency gains. Responsibilities must be clear, institutions must have the capacity to perform, and regulatory decisions must remain credible, predictable and consistent.
Value Pricing and Affordability: Electricity is both an economic good and a necessity. That dual character makes pricing particularly difficult. As an economic good, electricity must be priced sufficiently to provide adequate rewards for investors who commit capital and assume risk. As a necessity, however, affordability matters, particularly for low-income households and vulnerable consumers. The policy aim should therefore not be to choose between investor reward and consumer affordability. It should be to design a market in which both goals can coexist. That requires transparent and targeted social protection rather than a system in which underpricing electricity creates hidden liabilities throughout the value chain.
The sector’s liquidity challenge remains fundamental. When electricity is generated, but the revenue needed to pay for gas, operations, maintenance and investment does not flow efficiently through the value chain, the entire system suffers. Payment failures quickly cascade through the market: unpaid generators struggle to run sustainably, unpaid gas suppliers cannot support supply, underfunded distribution companies postpone investment, and banks become reluctant to finance receivables. The sector therefore needs a stronger commercial foundation. More generation without liquidity is not necessarily more electricity. Nigeria must ensure that electricity produced is converted into revenue and that revenue flows efficiently to every participant whose investment and service make supply possible.
The power sector is highly capital intensive: generation, transmission and distribution require large investments with long recovery periods, so economies of scale matter. Decentralisation can improve efficiency where local markets, distributed generation and state-specific opportunities justify it, but every arrangement should face an economic test: does it reduce the cost of reliable electricity and improve value for consumers? Decentralisation also does not negate the need for regional cooperation. States can tailor solutions to local conditions while coordinating generation, transmission, reserve capacity and electricity trade across wider markets. In this context, economies of scale are not merely theoretical; integrated markets can pool resources, spread risk and lower the unit cost of reliable power. Fragmentation should never become an end.
Investors do not demand a risk-free environment; they demand one in which risk can be named, priced and managed. Regulatory decisions must therefore be credible, predictable, transparent and consistent. Frequent rule changes, uncertain tariff arrangements, weak contract enforcement and unpredictable intervention increase the investment risk premium, and consumers ultimately bear that uncertainty through higher financing costs. Conversely, a credible regulatory environment reduces investment risk and the cost of capital—one of the most important economic principles Nigeria must recognise as it seeks to attract and keep capital in the electricity sector. Reliable electricity is not merely a utility-sector outcome; it is a productive input whose quality and cost affect industrial competitiveness, household welfare and economy-wide productivity.
Market Discipline: Nigeria does not need to wait for a perfect electricity market before making meaningful progress. Metering should come first because correct consumption data protects consumers from arbitrary estimated bills, improves revenue collection and gives households a reason to conserve electricity. Universal, independently verifiable metering would also make service-based tariffs easier to enforce. Band A pricing can improve consumer welfare when customers receive at least 20 hours of reliable supply and can replace costly generators, fuel, maintenance and lost productive time with grid electricity. The goal should be price differentiation based on the measurable quality of service each consumer receives—not classification by income, neighbourhood, class or social status.
Tariffs should reflect verified supply hours, reliability, voltage quality and the prompt resolution of outages, with metered consumption providing the foundation for transparent billing. Under such a framework, consumers who receive superior service may pay more because dependable electricity creates greater value and avoids costly self-generation, while those who receive poorer service should automatically pay less or receive credits. Affordability, however, must remain a separate policy goal. Government should protect vulnerable households through transparent, targeted support rather than distort the tariff structure through broad underpricing or status-based grouping. This approach would preserve consumer welfare, reward genuine service improvement and align the price paid with the quality delivered.
4.0 The Joy Ogaji Decade: Leadership, Advocacy and a Call to Action
It is within this broader context that I commend Dr. Joy Ogaji on her 10th anniversary as CEO of APGC. Her decade of leadership has coincided with some of the most consequential years in the evolution of Nigeria’s electricity market. Throughout this period, she has consistently brought the generation segment’s perspective into national discussions on market reform, investment, gas supply, tariffs, liquidity and the sustainability of the electricity value chain.
Her contribution goes beyond standing for the interests of generation companies. Effective industry leadership requires explaining why investor sustainability and consumer welfare are not necessarily competing goals. A financially distressed generation sector cannot provide reliable electricity, yet a market that ignores affordability cannot support broad-based social and economic development. Nigeria must balance these obligations through transparent tariffs, targeted consumer support, enforceable contracts and disciplined payment across the value chain. That is why voices such as Dr. Ogaji’s matter in the national conversation: the debate must move beyond whether electricity should be cheap or expensive and ask instead, how do we create an electricity market that is affordable, dependable, investable and sustainable?
Dr. Joy Ogaji’s 10th anniversary provides more than an occasion for congratulations; it offers an opportunity for reflection. The power sector needs leaders who can bridge policy aspiration and economic reality, investor sustainability and consumer affordability, and government responsibility and private-sector efficiency. Nigeria’s electricity transformation will not come from one intervention or one institution, but from getting the fundamentals right: good governance, sound market design, liquidity, proper pricing, economies of scale, credible regulation, investment discipline and accountability for performance. As we celebrate Dr. Joy Ogaji’s decade of service at APGC, the proper tribute is not merely to acknowledge the journey already travelled but to challenge the sector to harvest the opportunities that remain. The low-hanging fruit is within reach; what Nigeria needs now is the leadership, discipline and economic rationality to harvest it. Congratulations, Dr. Joy Ogaji, on a decade of distinguished leadership and advocacy for Nigeria’s power-generation industry.
OMOWUMI O. ILEDARE, PhD,
Sr. Fellow USAEE, Fellow NIPetE,
Fellow EI, Professor Emeritus,
Louisiana State University, Baton
Rouge, USA & Executive Director,
Emmanuel Egbogah Foundation,
Abuja, Nigeria.