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Citizenship Daily > Blog > Column > Rejigging Nigeria’s economy through energy investment
Column

Rejigging Nigeria’s economy through energy investment

Editor
Last updated: July 2, 2025 6:58 am
Editor Published July 2, 2025
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By Ussiju Medaner

There is no path to national development that does not pass through energy. The strength of modern economies — from agriculture to health, industry to education — is built on a steady, affordable, and accessible supply of energy. As of today, no nation has become great without getting its energy equation right. The United States, China, the UK, Germany — all their growth stories are tied to an unbroken chain of massive energy investments, both in scale and diversification.
Global energy statistics do not lie. They reveal a direct correlation between per capita electricity consumption and quality of life. In 2022, the average American consumed over 17,000 kWh of energy. The UK averaged about 1,365 kWh per person, while China, with its huge population and growing industrial base, reached nearly 1,000 kWh. Now contrast that with Nigeria’s average: a staggering low of 23 kWh per capita. That’s not just a gap; it’s a chasm. It reveals the naked truth — we have been running an economy in darkness, both literally and structurally. And we’ve been doing so for decades.
Despite possessing one of the highest energy resource endowments on the African continent — sun, wind, gas, hydro, and even nuclear potential — Nigeria remains energy-poor. We’ve become comfortable with excuses, explanations, and endless policy drafts that never transition into power lines or watts. The consequences are devastating. Industries have folded or relocated. Micro, small, and medium-sized enterprises are suffocating. Millions of youths remain unemployed or underemployed. Farmers can’t preserve their produce. Hospitals can’t operate fully. Education is hampered by darkness. And citizens pay the ultimate price — high costs, low productivity, and perpetual economic anxiety.
We often talk about diversifying our economy — away from oil and into manufacturing, agriculture, ICT, and services. But we ignore a fundamental question: how can you diversify an economy when the power to drive it does not exist?
What Nigeria suffers from is not just an energy crisis — it is a leadership deficit in the energy space. Over the past 30 years, successive governments have made massive budgetary allocations to power infrastructure with very little to show for it. Projects have been awarded without follow-through. Contracts are politicized. Transmission lines lie incomplete. And when you trace the trail, it often ends in padded procurement or dead institutions. The rot runs deep, and the consequences even deeper.
Yet, change is still possible — and urgent. The legal and regulatory tools are now falling into place. The 2023 Electricity Act gives Nigerian states full constitutional backing to generate, transmit, and distribute power independently. The unbundling of the power sector has opened new lanes for investment, decentralization, and reform. But laws alone cannot change reality. What will, is leadership — bold, honest, coordinated, and strategic leadership.
The first truth we must confront is this: we cannot rely on foreign entities to develop our energy backbone. While international partnerships and capital are welcome, the vision must be home-grown. No one will solve our problems better than we can. Energy sovereignty is not a luxury. It is a survival imperative. We must build it with local knowledge, local legislation, and local accountability.
And this begins with the states. Lagos is already setting the pace, investing in embedded power and local generation. But it must not stop there. Every state, regardless of its economic standing, must now view energy investment as a public priority — not a federal responsibility alone. State governments must set up independent energy commissions, partner with investors to establish small to medium-scale power plants, and legislate localized energy markets.
Imagine a Nigeria where Jigawa and Yobe build utility-scale solar farms that supply hundreds of communities and power agro-processing centres. Or a Delta State that uses its gas reserves to run industrial corridors with affordable LNG-powered turbines. Envision a Plateau that harnesses its wind capacity to feed mini-grids. These are not dreams. These are actionable realities, if we decide to act.
We must embrace a regionalized energy strategy that leverages the strengths of each geopolitical zone. The north has sun. The south has gas. The middle belt has wind and hydro. Each region can select its own dominant energy source and build around it — creating energy clusters that supply both local needs and inter-state markets.
To support this, we must urgently reform our licensing and approval system. Investors spend years navigating bureaucracy to build power plants. Permits get delayed. Environmental assessments become cash cows for rent-seekers. This must end. The Nigerian Electricity Regulatory Commission (NERC) must be empowered — and disciplined — to fast-track genuine projects with clear local impact. At state level, new energy laws must include investor protection clauses, transparent tariff frameworks, and clear dispute resolution mechanisms.
But even as we scale industrial energy, we must not ignore the beating heart of Nigeria’s economy: the small businesses. From hair salons to frozen food vendors, from welders to small ICT firms — these enterprises form over 80% of Nigeria’s active economy. Yet they spend more on diesel, fuel, and inverters than they earn in profit. This is unacceptable. We need to democratize power access.
One solution is to establish targeted energy access programs for MSMEs. The federal and state governments can subsidize solar mini-grids, provide low-interest loans for inverter installations, or partner with manufacturers to distribute solar kits on lease-to-own arrangements. The Rural Electrification Agency (REA) should be repositioned to not just serve remote communities but also urban micro-industries. When a seamstress can work without worrying about fuel, or a barber without hearing the hum of a generator, you build productivity from the ground up.
And for larger industries, we must introduce power syndication models. Industrial clusters or estates can pool resources to set up captive power systems. With support from government through land allocation, tax waivers, and legal support, groups of companies can invest in dedicated CNG or LNG plants that provide stable energy at a fraction of the national grid cost. This model is already working in parts of Ogun and Lagos; it can be replicated nationwide.
We also cannot afford to ignore the global energy trajectory. The world is moving — fast — toward renewables. In 2024, global renewable energy capacity grew by 700 gigawatts, the 22nd consecutive year of record growth. Renewables and nuclear now account for 40% of total global generation. And yet, Nigeria is not even on the chart. We must change this.
We need a national renewable energy investment plan — one that defines our targets, incentivizes local manufacturing of solar components, and opens the door for private investment. We should not just be importing panels; we should be producing them, installing them, and exporting surplus technology to other African nations.
Yes, nuclear energy must enter the conversation too. Carefully planned, safely executed, and legally monitored nuclear plants can serve as long-term base-load capacity for Nigeria’s growing urban centres. We don’t need many. Even two to three strategically located plants over the next 15 years could transform the country’s energy map.
And while we build generation, we must not neglect transmission and distribution. The national grid remains fragile, vulnerable to collapse, and outdated in design. State-level mini-grids, embedded power networks, and smart distribution systems must rise in parallel. We should encourage the use of micro-grids in isolated communities and rural industrial clusters. This is how we build an energy-resilient Nigeria — not by waiting for Abuja to “fix” the grid, but by rebuilding it from below, piece by piece.
What are the expected outcomes? Increased per capita energy consumption — from 23 kWh to at least 1,000 kWh within the next decade. Up to 40% reduction in production costs. Millions of new jobs across sectors. Revived manufacturing. Cheaper goods. Better services. An economy that grows not just in GDP figures, but in the lived experiences of its citizens.
But none of this will happen unless we first fix the elephant in the room: corruption. Every megawatt delayed, every transformer inflated, every diesel contract padded — costs the country jobs, peace, and growth. The energy sector must be removed from the grip of rent-seeking cartels and placed firmly under the eyes of independent regulators, auditors, and the people.
Transparency in power contracts, performance audits for DISCOs and GENCOs, and citizen oversight must become standard. The days of darkness must be replaced by the light of accountability.
Nigeria has no business being in the dark — not with our gas, not with our sun, not with our people. It is time to light up Nigeria — not just with bulbs, but with ideas, courage, and collective action.
A nation that powers itself, empowers its people. And an empowered people will build the economy that Nigeria desperately needs and richly deserves.

GOD BLESS THE FEDERAL REPUBLIC OF NIGERIA!

 

Professor Medaner is reachable via: justme4justice@yahoo.com; info@medaner.com

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