Chioma Nwosu sits in her small bakery in Surulere, Lagos, watching the ceiling fan slow down and stop. It’s 11:47 AM on a Tuesday. The national grid has collapsed again.
She doesn’t panic anymore. Instead, she reaches for her phone and calls her generator mechanic.
By noon, her neighborhood is filled with the hum of diesel generators from multiple homes and businesses
“I’ve spent more on diesel this year than I did on rent. And they still bill me for electricity I never got,” Chioma said.
Six hundred kilometers away in Kaduna, Ibrahim Musa runs a cold storage facility. He has lost his third batch of frozen goods this month, along with a portion of his savings, due to the outage. His generator consumes diesel at a high rate relative to his business revenue.
These are not isolated incidents. This is daily life for millions of Nigerians in Africa’s largest economy, a country sitting on vast energy resources and billions in power investments yet suffering constant blackouts.
The question everyone keeps asking is simple: Why does Nigeria’s electricity grid keep failing?
The talk about Nigeria’s grid state
Nigeria’s national grid continues to face persistent instability. The grid collapsed 12 times in 2024 alone. To put this in perspective, between 2000 and 2022, the grid failed an estimated 564 times.
The December 2025 collapse was particularly telling. Power supply across most parts of the country dropped to near zero, with only Abuja and Ibadan receiving 50 megawatts (MW) combined, while nine major distribution companies recorded zero megawatts.
Nigeria has an installed generation capacity of approximately 13,625 MW but only achieves an operational output of around 4,000 to 5,000 MW due to constraints in gas supply, transmission, distribution, among others.
By contrast, South Africa tells a different story. With an economy comparable to Nigeria’s and a smaller population, the country commands over 50,000 MW of installed capacity more than ten times what Nigeria has today.
Most of Nigeria’s large businesses have quietly walked away from the national grid, worn down by years of outages and unreliable supply. For many of them, staying connected simply no longer makes economic sense. Even the nation’s Minister of Power, Bayo Adelabu, acknowledged the scale of the shift, confirming that more than 60% of manufacturing companies have completely disconnected from the grid.
Industry data backs this up. Large firms and higher-paying customers are increasingly turning to self-generation.
That shift has left behind a troubling reality. Those who cannot afford to generate their own electricity now shoulder the burden of rising tariffs, all while contending with an unstable power supply that shows little sign of improvement.
What the government has done so far
On paper, Nigeria’s power sector has received unprecedented attention and investment. Since 1999, successive administrations have poured over $30 billion into the electricity sector.
The most publicized intervention is the Presidential Power Initiative, known as the Siemens deal. The government signed a $2.3 billion infrastructure project with Siemens Energy expected to add 7,000 megawatts of operational capacity to the national grid.
The agreement, modeled after Siemens’ successful work in Egypt where generation capacity increased by more than 40% in less than three years, promised to transform Nigeria’s ailing power sector.
Yet the Siemens deal was plagued with allegations of corruption as well as mismanagement of funds, leaving the project stalled since 2022 with little progress made in either generation or transmission.
The World Bank has also been heavily involved in the country’s electricty sector. Nigeria secured about 10 loans worth $4.36 billion from the World Bank over the past decade to address power sector challenges.
In 2023, the current administration signed the Electricity Act, which gave states the power to generate and transmit their own electricity. Fifteen states have already received approval to set up their own electricity markets, with one is fully operational.
But despite all this money and reform, the grid collapsed more times in 2024 than it did in previous years.
The impact of grid failure on homes and businesses
The economic cost of Nigeria’s electricity crisis is substantial, with the World Bank estimating the Nigerian economy loses $29 billion annually due to its unstable power supply, with about 2% of the country’s gross domestic product.
For businesses, each grid collapse is a financial disaster. It costs $7 million to restart just three major plants after a shutdown, compared to $105,000 to run them normally, according to industry data.
This translates to approximately N42.5 billion in losses for these three plants alone every time the grid fails.
The Manufacturers Association of Nigeria (MAN), for instnce, has repeatedly raised concerns about this issue. The body claimed that manufacturers have to shut down production lines whenever the grid collapses.
Restarting those lines costs extra money.
On their part, small and medium sized enterprises suffer even more. Many lack the capital to invest in alternative power sources like generators or solar panels, leaving them entirely dependent on the national grid.
In addition, the surge in fuel prices has pushed generator-powered electricity beyond the reach of many households, further restricting access to basic necessities and reliable power.
The ripple effects extend beyond economics.
In Chioma’s bakery, power outages mean spoiled ingredients, missed orders, and frustrated customers.
For Ibrahim’s cold storage business, they mean complete inventory loss. Unstable power can disrupt operations in hospitals, clinics, and schools, affecting service delivery and education.
Nigeria’s generator economy is valued at over N10 billion annually, making it the largest in Africa. For millions, generators are not backup power — they are the primary source.
What experts think
Meanwhile, energy experts and industry leaders have expressed growing concern with many taking to social media and public forums.
In November 2024, following the 11th collapse of Nigeria’s national grid that year, Odion Omonfoman, lead consultant on power to the Nigerian Governors’ Forum, told Arise News that the country’s electricity grid was unreliable, describing it as “epileptic.
“This whole thing of generating and putting on a national grid that is at best epileptic is ridiculous. “We are seeing how it’s affecting inflation. It’s one of the reasons our cost of living is high. Energy costs are high,” he said.
He alleged that some contractors may sabotage networks to secure repair contracts. But beyond the corruption and technical issues, Omonfoman sees a deeper structural problem.
“The cost of fixing the grid is endless and states are already taking their own steps to make sure they have their own generation within their states.There is no point trying to throw so much money at this national grid.
“Let’s look at other sources. Let’s look at distributed generation. Let’s look at states bringing in investment for electricity, bringing generation closer to the people who need it,” he explained.
According to Nigerian Observer, the association’s Director General, Segun Ayayi Kadiri, said manufacturers have to shut down production every time the grid collapses and restarting takes extra money.
“There is no way manufacturing can thrive perfectly when you don’t have a steady and affordable power supply,” he said.
Meanwhile, the Association of Power Generation Companies emphasized on the financial damage to power producers stating that when the grid fails, power generation stops, GenCos can’t sell electricity and their cash flow collapses.
Where do we go from here
So far in January, Nigeria’s grid has collapsed twice, plunging the country to nationwide darkness.
Experts and analysts argue that the crisis highlights structural challenges in the sector, including governance and investment issues, beyond funding alone.
The country has secured billions in loans, signed deals with international companies, and passed multiple legislation.
Despite these efforts, many households and businesses, like Chioma’s bakery and Ibrahim’s facility, continue to rely on generators and face losses from outages.
Whether run by private firms, state entities, or public private partnerships, the priority must shift toward cost recovery, transparent pricing, competitive investment, and long term infrastructure planning.
Stakeholders suggest shifting focus toward cost-reflective tariffs, transparency, private investment, and related reforms to improve sustainability and reduce the ongoing costs of unreliable power.
Without such changes, outages and reliance on alternatives are likely to persist, hindering economic development.
