Nigeria targets $1bn annual revenue from power export 

 …as major off-takers exit nation grid

The Federal Government has sets its sight on exporting idle electricity generated in the country to neighboring African countries in a desperate move to ensure energy security, Business Hallmark has gathered.

The move is part of government’s strategy to strengthen and prevent the imminent collapse of the nation’s national power grid as major off-takers continue to exit the epileptic grid in droves.

This pivoting to electricity export is coming in spite of Nigeria’s wide electricity supply gap, with daily average generation currently hovering around 5,000 megawatts.

BH learnt at the weekend that government decided to send idle electricity offshore in order to guarantee local energy security, which is currently being threatened by the continued exit of heavy power consumers from the nation’s unreliable power grid.

It would be recalled that the national grid experienced several collapses in the last two years, leading to constant disruption of commercial and business activities.

For instance, the grid is reported to have officially collapsed 12 times in 2024 and three times in 2025. The shutdowns are attributed to ageing facilities, lack of maintenance, inadequate investment in the power sector and vandalization of power facilities.

In a bold move to tackle the energy deficit, President Bola Tinubu signed the Electricity Act 2023 into law on June 5, 2023. Since then, requests for captive power generation for exclusive internal use have soared.

Off Grid Power

Available data indicates that over 250 companies, made up of manufacturing companies, government agencies, as well as health and educational institutions had dumped the troubled national power grid for their own independent power plants.

The organisations that operate outside the national grid include the Dangote Industries Limited (DIL), Presidential Villa, Abuja, Nestle Nigeria, the Nigerian National Petroleum Company Limited (NNPCL), Olusegun Obasanjo Presidential Library, Abeokuta, Total Nigeria and Shell Petroleum Development Company (SPDC), with Dangote Industries Limited alone generating 1,500MW of the electricity.

One of Dangote’s subsidiaries, the petroleum refinery in the Ibeju-Lekki area of Lagos, alone has a 435 megawatts power plant that can meet the total power requirement of the Ibadan Electricity Distribution Company.

Official figures put aggregate power generated by these companies at 6,500 megawatts.

Despite that, more permits for private plants are being issued by NERC. In the first quarter of 2025, the national electricity regulatory body announced that it awarded 24  licenses to bulk electricity consumers to generate a total of 138 megawatts for their own use and disconnect from the national grid.

The organisations that got licences include the Nigerian Breweries branches in Ibadan, Enugu and Aba with the approval for a total of 31.36 megawatts, MTN Nigeria Communication Limited 15.94 megawatts, University of Abuja 3 megawatts; University of Calabar and its Teaching Hospital secured 7 megawatts, Nile University of Nigeria Jabi Abuja 10 megawatts, African Steel Mills 20 megawatts and the Michael Okpara University of Agriculture, Umudike 3 megawatts.

Other organizations with licences to generate their own electricity are Ro-Marong Nigeria Ltd 4.40 megawatts, SweetCo Foods Limited 1.50 megawatts, Psaltry International Company Limited 1.10 megawatts, Armilo Plastics 1.13 megawatts, Royal Engineered Stones 4 megawatts, West African Ceramics Limited 10 megawatts, the Nigerian Defence Academy (NDA) 2.50 megawatts and Quantum Paper Limited 7 megawatts.

Also on the list are the University of Maiduguri Main Campus and its Teaching Hospital 12 megawatts, Federal University of Agriculture Abeokuta 3 megawatts and the Federal University Gashuwa, Sabon Gari 1.50 megawatts.

However, BH gathered that the rate at which bulk electricity consumers are abandoning the national grid to generate their own electricity has taken a negative toll on the nation’s power grid, with experts blaming the instability of the grid on the exit of bulk buyers.

According to the Executive Director of PowerUp Nigeria, Adetayo Adegbemle,  the companies with their own captive powers are the ones that should be serving as anchor tenants to ensure the country has a stable grid.

“I have said before that one of the major objectives, if I were to be in charge of the grid, would be to bring these companies back if we truly want to have a stable and cheaper grid supply.

“Many of the grid collapses we have had can also easily be traced to such consumers leaving the grid, making the demand end of the grid less stable,” Adegbemle lamented.

Power Export Strategy 

Meanwhile, the Federal Government has moved in to forestall the possible collapse of the national grid with a successful grid synchronisation test connecting the grid with the interconnected West African Power Pool system of 15 West African countries under the Economic Community of West African States (ECOWAS).

Conducted between 05:04 am and 09:04 am of November 8, 2025, the exercise saw the Nigerian grid successfully connected to the West African Power Pool system, which includes Togo, Benin, The Gambia, Guinea-Bissau, Mali, Niger Republic, Togo, Ghana, Côte d’Ivoire, Burkina Faso, Liberia, Sierra Leone, Guinea and Senegal.

For over four uninterrupted hours, electricity flowed seamlessly across 15 national borders at a single stable frequency.

The feat marked the most successful synchronisation attempt since 2007, when a trial was aborted seven minutes after it was initiated.

According to officials in the Ministry of Power, who spoke with BH on the matter, apart from providing a critical buffer for the national grid against the negative effects of major off-takers going offline, revenue from the power export will help reduce liquidity shortfalls in the energy industry, as well as accelerate expansion of regional energy markets.

Speaking during the grid synchronisation test with the 15 West African countries that lasted four hours, the Minister of Power, Chief Adebayo Adelabu, said the development will allow Nigeria to fully exploit its strategic role as the regional power hub under the West African Power Pool.

“The benefits of synchronization with other WAPP countries would extend directly to the Nigerian people. A more stable grid improves the performance of essential services, such as hospitals, water supply, transport systems, digital infrastructure, and public institutions.

“As ongoing transmission expansion projects, including the North-Core line, the Ajegunle 330 kV Substation, the Kaduna–Kano transmission upgrades, and the Gwagwalada–Gurara connection, are completed, synchronization will help deliver more reliable power to homes and industries nationwide.

“While expectations must remain realistic, this achievement provides the structural foundation for the improvements Nigerians have long awaited”, the minister stated.

Adelabu lamented that while Nigeria’s transmission wheeling capacity has risen to 8,500 megawatts, low demand from electricity distribution companies (Discos) has kept actual generation at around 5,000 megawatts, leaving about 3,500 megawatts stranded within the Nigerian Electricity Supply Industry (NESI).

“Today, the minimum grid capacity we can even communicate is 8,500 megawatts of capacity. If our generation reaches 8,000MW today, the grid can comfortably and conveniently transmit it. We are even sure that it is higher than that, but it is put at a conservative level, at 8,500 megawatts.

“We have the capacity and the facility to generate more power in Nigeria, and investment is still open to interested power sector investors. As long as there is demand in the other 15 countries of West Africa, Nigeria can easily export energy to those countries,” Adelabu assured.

Revenue Against Affordability

BH learnt that the arrangement, which involves exporting an initial 600 megawatts, will fetch Nigeria an annual revenue of $1 billion (N1.450 trillion).

Based on NERC figures, the initial 600,000 kilowatts (600 megawatts) been exported at the prevailing tariff of $0.19 per kilowatt-hour charged by several other countries in the West African sub-region will fetch about Nigeria $114,000 every hour. This translates to a daily revenue of $2.73 million, as well as monthly and annual revenues of $81,900,000 and $998.6 million respectively.

Exported power to regional countries is expected to more than double by the end of June 2026 after the completion of a planned permanent grid synchronization exercise.

Speaking on the possible shortfall in the volume of electricity supplied for local use as a result of the new policy, the minister of power assured Nigerians that exporting power to West African countries will not compromise supply to the domestic market.

Also speaking, the Executive Director of PowerUp Nigeria, Adetayo Adegbemle, said the Federal Government must bring back exited industries and organizations to the national grid to help stabilize electricity supply and reduce costs of goods.

According to the PowerUp Nigeria executive, manufacturers spend several billions of dollars annually on alternative energy sources, an expense they in turn push to consumers.

He maintained that Nigeria cannot achieve affordable power or industrial expansion without reintegrating large-scale consumers to the grid.

“If that money enters the national grid, they can easily give electricity for free to homes because somebody will be paying for it. They can close their eyes and do cross-subsidies.”

Adegbemle, while referencing a recent report by the Manufacturers Association of Nigeria (MAN), said manufacturers spend over N45 trillion yearly on self-generation

“You cannot build the grid on residential consumers. It has to be built on industries and commercial customers. They are the ones that can wake up in the morning and use 500 to 1,000 megawatts at once,” Adegbemle said.

He also faulted the current focus on decentralized, small-scale solutions, warning that abandoning the grid in favor of isolated generation will undermine efforts to lower electricity prices.

He concluded by urging government to initiate policies that make grid power reliable and attractive for industrial users.