This is a best prospect industry sector for this country. Includes a market overview and trade data.
Last Published: 2/23/2017


Unit:   USD thousands






Total Market Size





Total Local Production





Total Exports





Total Imports





Imports from the U.S.





Exchange Rate:   1 USD





Total Market Size = (Total Local Production + Total Imports) – (Total Exports)
Data Sources: 
Total Local Production:   Independent Power Producers and other local sources such as Manufacturers Association of Nigeria.
Total Exports:   Independent Power Producers and other local sources such as Manufacturers Association of Nigeria.
Total Imports:   Independent Power Producers and other local sources such as Manufacturers Association of Nigeria.
Imports from U.S.:   U.S. Census Bureau.
Nigeria’s power sector continues its ongoing comprehensive reforms with a view to expand capacity and increase access to electricity for its population.  According to the Ministry of Power, the demand for electricity in Nigeria as at January 2016 is estimated at 12,800 MW, with supply at about 4,500 MW, leading to widespread self-generation.  The government of Nigeria estimates that by 2020, 26,600MW of additional supply will be required to meet demand, an investment of upwards of $4 billion.  Industry observers believe that the continuing trend of demand outstripping supply can only be mitigated with significant investment to expand supply, distributed energy sources, and upgrade existing infrastructure (grid modernization), in order to achieve expected growth in the sector, which is stymied by several challenges, including operating losses at the generation, transmission, and distribution level; and inadequate capex for roll out of new power generation projects, and for rehabilitation, replacement and system expansion projects to address the inadequate/ weak power transmission and distribution capacity.  All the capital projects planned by Transmission Company of Nigeria (TCN) in its nationwide program of Rehabilitation, Replacement and System Expansion projects for achieving power wheeling capacities of 7 – 8GW by 2015 and 10GW by 2017, which were to cost US$2.235 billion and US$2.556Billion respectively, were shelved as a result of lack of funding.

The NERC recently approved the roll out of a 45 percent increase in electricity tariff across the board, which was implemented in February 2016, despite the resistance of consumers who argue that the increase is not commensurate to service.  This is part of the Nigeria Electricity Regulatory Commission’s (NERC) phased increase of electricity tariffs towards cost-reflective levels, viewed as an important step towards improving the sustainability of investment in the sector.  Significant challenges remain, however, including the need to deregulate natural gas pricing to provide incentives to develop greater supply for domestic power generation.

The GON has announced objectives to increase the country’s power generation capacity to 10,000 MW by 2017.  Industry sources indicate that the country will need additional generation capacity of about 2,200 MW from the NIPP projects (1,896 MW), IPPs (296MW) and FGN legacy assets [installed - Thermals 5.6 GW, Hydro 1.3GW and Wind {pilot} 10MW].  In addition, GoN is also investing heavily to boost generation through the large, medium and small hydrostatic power plants with total capacity of over 4,234 MW.  These include Zungeru -700 MW; Mambilla - 3,050 MW; Gurara 11 - 360 MW; Isti - 40 MW; Small hydropower - 84 MW. 

Other initiatives embarked by the government include:   

  • Power China Corp’s over 20GW 10,000km Transmission lines.
  • Sale of NIPP (4,775MW).
  • New IPPs in planning stage 2.6GW.
  • Coal/Renewables.
  • Operation Electrify Nigeria. 

The understanding is that the power projection for 2015 to 2017 is underpinned by several Memoranda of Understanding (MOUs) with the following organizations: 

  • Power China:  to build 20,000MW capacity thermal power plants and a 10,000km of transmission lines.
  • General Electric (GE):  facilitating and promoting private sector investment up to 10,000MW.
  • Siemens AG:  facilitating and promoting private sector investment up to 10,000MW.
  • Electrobras:  facilitating and promoting private sector investment up to 10,000MW.
  • Daewoo E&C:  facilitating the development, financing, procurement, manufacture, commissioning and operations of 10,000MW.
  • EDF/ETDE:  promoting power sector investments by sponsoring feasibility studies for approved projects.
  • Multi-Lateral Government-to-Government (G-TO-G) Agency Support:  promoting the development of small / medium hydro-power plants as embedded generation for rural communities.

Each of these MOUs presents opportunities for new ventures by Nigerian-led power development consortiums. The MOUs are designed to make significant equity contribution in kind or cash, as well as provide credibility for IPPs seeking international financing.

Sub-Sector Best Prospects

Despite the various challenges highlighted above, the decision of the GON to make the Nigerian power sector to be private sector driven provides opportunities for international and local investment.  Currently, Nigeria presents a huge trade opportunity to U.S. suppliers of portable generating sets (20-500 KVA) and parts, renewable energy and solar systems.  Trade and investment opportunity also exists in developing off-grid micro power plants (1 MW to 20 MW) in strategic industrial cities/areas to sell directly to end-users.  The GON allows off-grid sale of generated power.
Solar:  Nigeria is estimated to have about 485.1 million MW per hour per day (MW/h/d) of solar energy with average daily sunlight pf about 6.2 hours.  Industry watchers believe smaller solar plants are viable for rural communities, especially in the Northern parts of Nigeria, which is estimated to hold the most potential for solar energy especially the rural communities that are off grid and can benefit from small micro grid projects and solar plants.

Hydro:  Nigeria is estimated to have total exploitable large scale hydro power potential of over 14,120 MW capable of producing 50, 832 GW of electricity annually.  Its potential for small hydro power is estimated at 3,500 MW of which only 60.58 MW (about 1.7 percent) has been developed.  The country’s hydroelectric energy is about 20 percent of installed capacity.  The Presidential Task Force on Power estimates that there is potential for 11,500 MW in large hydro power plans and up to 730 MW in small hydro-power projects.

Large Hydro Power Development

  • 3,050MW Mambilla Hydro Power Plant Project;
  • 700MW Zungeru Hydro Power Plant Project;
  • 360MW Gurara II Hydro Power Plant Project;
  • 40MW Kashimbilla Hydro Power Plant Project;
  • 40MW Itisi Hydro power Plant Project.

Small and Medium Hydro Power Projects – Nationwide
Wind:  Nigeria has great potential for onshore power generation and already, a 100 MW wind power project is under development, while offshore wind resources is being evaluated and mapped out. 

Biomass:  The Nigerian National Petroleum Corporation (NNPC) has a renewable energy division which has mapped out biomass and has a mandate to expand the automotive biofuels industry.  The project which will be executed as a Public-Private-Partnership (PPP) with NNPC as a minority shareholder will use sugarcane and cassava as key biomass raw materials. However, this has been stalled due to a lack of appropriate legislative framework, appropriate equity financing and biofuels policy.


There continues to be widespread self-generation of electricity which continues to provide opportunities for gensets and related equipment. Nigeria presents a significant trade opportunity to U.S. manufacturers and suppliers of diesel-operated generating sets (20-500 KVA) – the GON officials have stated that they do not expect the power situation to improve until 2017 when the privatized GENCOs and DISCOs fix their newly-bought assets and are able to supply power to Nigerian homes.  Until then, corporate offices, service providers and individuals have to generate their power needs that range between 20 KVA and 500 KVA and U.S. diesel-operated power equipment are preferred.  Opportunities also exist for grid projects including transmission and distribution network upgrades, expansion of backbone infrastructure, metering, billing and collection software systems and solutions, and theft and loss prevention systems.
U.S. firms interested in the electric power sectors are encouraged to explore opportunities existing in the following areas: 
Building of transmission and distribution infrastructure to wheel increased power generated by GENCOs and sold to DISCOs through the Nigerian Bulk Electricity Trading Trader (NBET). This is expected to enhance Nigeria’s national grid and enable independent power plants interconnect and discharge their power.

  1. Joint Venture partnerships to build off-grid captive power plants (5 – 19 MW) for resale to manufacturing industries in strategic cities – GON Power Reforms allow off-grid sales of generated power.
  2. Partnerships to offer technical services to newly privatized GENCOs – upgrade of existing equipment. (turbines).
  3. Renewable Energy (RE) systems – solar, wind, biomass.
  4. Technical services for DISCOs for proper metering and billing systems.
  5. Supply of Prepaid Meters to DISCOs.
  6. Training of GENCOs and DISCOs technical personnel for maintenance of equipment.
  7. Sale of Heavy-duty Gensets (100 KW to 1 MW) – most companies operating in Nigeria provide their own reliable source of power such as diesel-operated heavy duty generating sets.  U.S. and European-origin equipment are preferred in view of their reliability and serviceability.  U.S. manufacturers of power equipment may utilize the guarantees provided by Ex-Im Bank and OPIC as incentives to purchasing gensets from the U.S. 
  8. Support Services: 
  • Provision of specialized training for electricity industry technicians and managers;
  • Assembly plants for intermediary power equipment and accessories, including meters;
  • Consultancies in Regulatory and Consumer education initiatives; and
  • Provision of Power Sector specific equipment testing, calibration and logistics services.

Investment Opportunities


  1. Nigeria’s transmission network needs significant investment.
  2. Plan for a 765KV Super Grid (conceptual).
  3. New, greenfield IPPs.
  4. Smart metering devices – manufacturing and servicing.  
  5. Manufacturing of electricity generation, transmission and distribution equipment and spare parts.  
  6. Funding options include: 
  • International Development Banks;
  • Multilateral Funding Sources;
  • Public Private Partnership; and
  • Local Capital Market.

Remote, Off-Grid and Renewable Energy

  • Pre-feasibility a feasibility studies for remote and off-grid locations.
  • Load profiles and forecasts for Remote and off-grid locations.
  • Development of commercial framework for implementation of remote and off-grid power.
  • Funding and Technical support for pilot project implementation.
  • Staff training and capacity building for the Nigeria Electricity Supply Industry –NESI.
  • Selected pilot projects in off-grid, solar – powered electricity supply to rural communities e.g. Durumi, Shape, Waru.

Trade Events

Key Agencies in the Nigeria Power Sector

  1. Federal Ministry of Power – policy formulation and consistency.
  2. Nigeria Electricity Regulatory Commission – issuance of licenses and regulation.
  3. Nigeria Bulk Electricity Trading Company Plc – power purchase agreements.
  4. Nigeria Electricity Liability Management Company – take over and management of all liabilities and from the legacy generation and distribution companies.
  5. Gas Aggregation Company of Nigeria – allocation of gas for domestic use.
  6. Transmission Company of Nigeria – management of the National Grid.
  7. Nigeria Gas Company – gas infrastructure and transportation.
  8. Rural Electrification Agency – remote and off grid projects.
  9. Electricity Management Services – testing and certification of electrical components for quality and suitability.
  10. Presidential Task Force on Power – facilitating cross - sectoral solution.

Web Resources
Email Benedicta Nkwoh, Senior Commercial Specialist:

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More Information

Nigeria Electricity Infrastructure Trade Development and Promotion