Nigeria’s electricity sector remains fragile. About 85 million Nigerians (43% of the population) lack access to grid electricity. This is one of the biggest energy access gaps in the world
Generation capacity is roughly 12,000MW–13,500MW, but far less power is actually delivered. In 2023, Nigeria generated 4,500MW for a population of over 200 million. For comparison, Ethiopia, with a population of 132 million, recently added 6,000MW to its generation capacity. Prior to that, it generated 5,200MW.
Nigeria’s under-delivery is largely due to systemic challenges in the grid. These include technical inefficiencies, vandalism and ageing infrastructure.
A new Electricity Act was passed in 2023 to address these problems by providing a legal and institutional structure. It was also designed to steer Nigeria’s power sector towards greater efficiency, integrated planning and the inclusion of renewable sources of energy.
For the first time, the act empowered the 36 state governments to generate, transmit and distribute electricity within their territories.
By July 2025, 10 states had introduced their own electricity market laws. They had also begun to set up state-level regulators and frameworks to oversee electricity operations within their borders.
Until such laws are in place, the Nigerian Electricity Regulatory Commission continues to regulate the sector.
But the shift from federal control towards localised electricity solutions raises questions about coordination, regulatory clarity and the capacity of individual states.
These are the challenges highlighted in the African Development Bank’s Electricity Regulatory Index Report, published in 2024. The report covers 43 countries.
Overall, the index’s 2024 tables place Nigeria 15th out of the 43 assessed countries.
I reviewed the report based on my academic research, which has included a PhD on reform in Nigeria’s power sector. The report makes it clear that Nigeria’s electricity reforms look solid on paper, but the real-world results still lag. The country’s energy sector is not uniformly ready to carry out the reforms. And, although there are rules and the regulator is not starting from zero, Nigerians still don’t have consistent, affordable and reliable power.
The African Development Bank’s message is clear. To provide a reliable service, utilities must be transparent and financially sustainable.
The indicators
The index scores countries on three aspects of regulation:
governance (laws and institutions)
substance (whether rules and tools exist and are applied)
outcomes (what consumers and utilities experience).
So how does Nigeria score?
Governance: Nigeria performs strongly. It had a Regulatory Governance Index score of 0.897 in 2024, which is high.
The countries ahead of Nigeria are Uganda, Tanzania, Senegal, Kenya, Rwanda and South Africa.