In early 2025, 29-year-old software engineer Tunde Olawale landed a remote role with a European tech firm.
From his flat in Yaba, Lagos, the pay looked life-changing, yet Nigeria’s erratic electricity threatened to derail his new career before it even began.
“In my first week, I had three virtual meetings cut off because the power went out,” Olawale said. “I was scrambling between my laptop battery, my neighbour’s generator, and cafés with internet just to stay online. It was embarrassing. I worried they would think I was not serious.”
The first Band A bill deepened the shock.
Eko Electricity, one of Nigeria’s leading utility had not installed a prepaid meter for his building, so he was placed on postpaid, estimated billing.
The charge topped N85,000 ($53) for a month with frequent blackouts. “I felt cheated,” he said. “They kept sending big figures when there was barely light. I was paying for promises that never became reality.”
Estimated billing assigns charges to unmetered customers using feeder or transformer averages, a method that often inflates bills until a prepaid meter is installed.
Olawale invested N3 million ($1,875) in a solar system, financed partly by a loan from his brother abroad.
“I cannot afford to lose this job,” he said. “Solar lets me work without fear of sudden blackouts. I think every day about those who cannot buy their way out.”
Band A’s broken promise
The Nigerian Electricity Regulatory Commission (NERC) introduced the Band system in 2024 as the boldest reform in a decade.
The idea was simple: create cost-reflective tariffs by charging higher rates to those who could afford it, and in return guarantee better service.
Band A customers were promised a minimum of 20 hours of electricity daily.
Reports by Reuters and Bloomberg captured the optimism. International investors had long argued that Nigeria’s heavily subsidised power sector was unsustainable.
The reform was expected to attract fresh capital, reduce government subsidies, and give distribution companies the resources to improve infrastructure.
But flaws quickly emerged. Transmission lines collapsed, gas shortages hobbled power plants, and the distribution network struggled to meet demand.
Band A customers complained that the promised hours were rarely delivered.
A Lagos banker, for instance, told our reporter that his monthly bill doubled while his neighbourhood still endured outages several nights a week.
Instead of restoring trust, the system exposed the fragility of Nigeria’s grid.
By mid-2025, protests had erupted in parts of Abuja and Port Harcourt as residents demanded lower tariffs.
Even businesses that had initially welcomed the reform began looking elsewhere.
Nigeria’s experience is not unique. South Africa, grappling with load-shedding from its ageing coal fleet, has tried similar tariff hikes to stabilise Eskom. Yet as in Nigeria, higher prices without improved service only deepened public anger.
Leaving the grid for private power
For those who could afford it, the escape route was obvious. Rooftop solar and hybrid power systems began spreading across Nigerian cities. Installers say demand has more than doubled since the introduction of Band A.
The economics were persuasive.
Spend between N2 million ($1,250) and N5 million ($3,125) upfront, or keep paying unpredictable bills that may exceed N100,000 ($62.5) a month.
Figures from the International Energy Agency (IEA) confirm that Nigeria is now one of Africa’s fastest-growing markets for solar home systems.
Financing support accelerated the shift. All On, an off-grid energy investor backed by Shell, and several Nigerian banks offered loans that allowed households to spread payments over months or years.
“It is a silent revolution,” said a Lagos-based installer who has fitted more than 100 homes in the past year.
“People are tired of paying for power they do not receive. Solar is expensive, but it gives peace of mind.”
The private sector has moved faster still. Several leading banks now run clusters of branches on solar, insulating themselves from tariff shocks.
In Ogun and Kano states, industrial estates have invested in captive power plants using gas or renewables.
A Financial Times report noted that some Nigerian firms now treat grid electricity as a “backup” rather than their main supply.
Egypt offers a contrasting example.
Its government phased in tariff reforms from 2014 while heavily investing in new generation capacity, including gas and renewables. As a result, households endured price hikes but also saw supply stabilise.
Nigeria introduced higher tariffs without first fixing supply, pushing those who could afford it to defect from the grid.
For distribution companies, this exodus is devastating. Band A was meant to secure revenue from high-value customers. Instead, those customers are leaving first, draining the sector of its most reliable income.
The poor pay for less
While the wealthy are buying their way out, the poor remain trapped. Renewable energy is far beyond their reach.
A basic five-kilowatt system costs the equivalent of several years of income for households surviving on Nigeria’s minimum wage of N30,000 a month (the Band A tariff became operational long before a new minimum wage was implemented).
Even cheaper solar kits remain unaffordable for many. A World Bank survey in 2024 found that more than 80 million Nigerians still lacked reliable electricity.
Many spend heavily on kerosene, firewood, or small petrol generators.
In some rural communities, BBC Africa reported, families spend as much as a third of their income on candles and fuel yet still live in darkness for most of the week.
Urban tenants face a different trap.
In parts of Lagos, Abuja, and Port Harcourt designated as Band A zones, landlords or geography place them in the highest tariff category. Even if their incomes are modest, they must pay higher rates.
With landlords often controlling meters, tenants have no power to contest the classification.
Small businesses face the same squeeze.
A tailor in Kaduna described how his monthly bill tripled under Band A. Unable to afford solar, he now runs a petrol generator for several hours daily. “The noise and fuel cost are killing me,” he said. “But if I stop, my customers will go elsewhere.”
In rural Niger State, mini-grids have brought relief to some communities, but many remain off the grid entirely. “We pay for solar light in our village cooperative,” said Halima Musa, a farmer near Bida.
“It is better than kerosene, but we still cannot afford to run machines or pump water. The city people are moving to solar big-big, but we only see small light.”
Contrary to official claims, Band A has not only affected the rich. It has locked thousands of low-income families and businesses into bills they cannot afford, often without receiving the quality of supply that was promised.
An energy transition that divides
The result is a deeply divided energy transition.
For the middle class and corporate sector, renewables are an exit route. For the poor, they remain a distant dream.
Analysts warn that this dynamic is unsustainable. The International Renewable Energy Agency (IRENA) noted in a recent report that without deliberate policies to expand access, clean energy transitions in Africa risk reinforcing inequality.
Nigeria’s experience is proving the point.
Distribution companies now face a shrinking revenue base as wealthier customers leave. Investors who expected Band A to provide predictable returns are reconsidering. For poorer households, the transition is another reminder that they are paying more for less.
“The danger is that energy becomes another marker of inequality,” said a Nigerian energy consultant. “The rich can buy their way out. The poor cannot, and they end up carrying the heaviest burden.”
This inequality has broader consequences. It affects education, health, and productivity.
Children cannot study in darkness, hospitals cannot rely on unstable supply, and small businesses spend a growing share of income on fuel.
The renewable boom, celebrated in some quarters, risks leaving millions further behind.
Kenya offers an instructive contrast. Through a mix of subsidies and private partnerships, it has distributed millions of small solar kits to rural households at affordable prices. While Kenya still faces challenges, its approach shows that renewables can narrow inequality when access is prioritised.
Nigeria’s current path risks the opposite.
Policy under pressure
By late 2025, government officials were openly discussing scrapping the Band system. The Nigerian Electricity Regulatory Commission signalled that it might return to uniform tariffs, supported by targeted subsidies for the poor.
Policy analysts see this as an admission that the reform has failed.
Al Jazeera reported that the reform was intended to attract private capital and stabilise Nigeria’s power sector. Instead, it has driven away the very customers it relied on. Trust between consumers and the government has eroded further.
Experts argue that the way forward must prioritise equity. Subsidies should be targeted at low-income households, not distributed broadly.
Rural electrification through mini-grids and solar home systems must be scaled up. Tariffs should be tied not just to cost recovery but also to fairness.
“The Band A experiment shows that you cannot fix a broken system by simply raising prices,” said an energy economist at the Centre for Development Studies in London. “Reforms must focus on expanding supply, upgrading infrastructure, and protecting the most vulnerable.”
Nigeria’s power deficit remains massive.
The country has about 13,000 megawatts (MW) of installed capacity but rarely generates more than 4,000 MW.
By comparison, South Africa, itself plagued by load-shedding, generates more than 30,000 MW. Without new investment, Nigeria’s tariff tweaks will remain cosmetic.
Light for a few
On a recent evening in Yaba, the hum of Tunde Olawale’s solar inverter filled his flat as he wrapped up a late video call with colleagues in Europe.
Outside, the street was dotted with the noise of petrol generators sputtering in the dark. Inside, his internet stayed steady and the lights did not flicker.
He is still paying off the loan that financed his N3 million solar system, and the debt weighs on him. Yet he knows he is one of the fortunate few who could make the leap. “I think about it all the time,” he said.
“I was lucky to get support from my brother abroad. Without that, I would still be struggling with outrageous bills and constant blackouts. Not everyone has that chance.”
His reflection captures Nigeria’s dilemma. The Band A reform, meant to bring fairness and stability, has instead widened inequality. For a minority like Tunde, solar has created a path to independence.
For the majority, the struggle to afford power has only deepened.
Unless reforms change course, Nigeria’s renewable boom may be remembered not for powering opportunity, but for leaving millions more in the dark.ce.
For the majority, it has deepened the struggle to afford power.
Unless reforms change course, Nigeria’s renewable boom may be remembered not for lighting up homes, but for leaving millions more in the dark.
