Nigeria's electric power sector reform: what should form the key objectives?

Nigeria's electric power sector requires substantial reform if the country's economic development and poverty alleviation program is to be realised. This understanding is behind the reform programme recently initiated by the Nigerian government with the goal of privatising the national electric power monopoly, NEPA. Currently, the country faces serious energy crisis due to declining electricity generation from domestic power plants which are basically dilapidated, obsolete, unreliable and in an appalling state of disrepair, reflecting the poor maintenance culture in the country and gross inefficiency of the public utility provider. Building on an analysis of the major shortcomings of the current electric power company, this paper presents the central issues that should form the key objectives of the proposed reform. This include corporatization of the electric power industry, increasing access and power delivery capacity, constraining the costs of the power industry and increasing efficiency and share of renewables in energy generation, as well as minimising environmental damage. We conclude with the observation that efforts at reform will not yield the desired result if the current end-user inefficiency is not constrained. As Nigeria implements its national utility privatisation programme, it is hoped that this review will benefit policy makers and emerging managers and providers of electricity service in the country.