Nigeria’s 21 operational electricity plants on the national grid have reportedly suffered financial losses of approximately N229.6 billion in 2024 due to repeated grid failures, further straining the sector’s already challenging liquidity issues.
At a workshop organized in Abuja by the Association of Power Generation Companies (APGC), industry experts noted that the frequent need to ramp down generation equipment is increasing the demand for foreign currency to replace parts, as components are wearing out faster due to unstable transmission infrastructure.
APGC representatives stated that each plant lost an estimated N10.9 billion in 2024, with a total of 10 grid collapses reported by the Transmission Company of Nigeria (TCN) this year alone.
Data presented by APGC highlighted a year-over-year increase in energy losses attributed to system failures, instability, forced shutdowns, and unplanned outages.
In 2024, losses from system collapses amounted to 57,687 MWh, costing N3.46 billion, up sharply from 11,137 MWh (N345.18 million) in 2023 and 35,794 MWh (N568.49 million) in 2022.
The report also indicated that system instability led to losses of 72,473 MWh, valued at N4.44 billion, in 2024, compared to 57,088 MWh (N1.42 billion) in 2023 and 72,529 MWh (N1.16 billion) in 2022.
Losses due to ramp-down were particularly high for Kainji and Jebba power plants, totalling 206,956 MWh (N12.8 billion) in 2024, a significant rise from 133,585 MWh (N3.73 billion) in 2023 and 34,344 MWh (N540.5 million) in 2022.
Unplanned outages in 2024 resulted in 19,643 MWh lost at N1.17 billion, reflecting lower energy losses than in 2023 (27,561 MWh, N809.76 million) but an increase in associated costs. In 2022, unplanned outages accounted for 6,856 MWh lost, costing N110.85 million.
Total losses for 2024 were recorded at 356,759 MWh, translating to N21.87 billion, or roughly N10.9 billion per power plant. This marks a substantial increase from 229,370 MWh (N6.3 billion) in 2023 and 149,524 MWh (N2.38 billion) in 2022.
During the event, Dr Joy Ogaji, CEO of APGC, highlighted the critical challenges posed by grid collapses, which not only disrupt operations but also inflict heavy financial losses on power generation companies (GenCos).
She emphasized the urgent need for collective efforts to resolve these issues.
“Grid collapses severely impact Nigeria’s power sector by causing equipment damage, disrupting operations, and leading to major revenue losses for GenCos,” Ogaji explained.
He noted that these issues harm both infrastructure—like generators and transformers—and financial performance due to reduced sales, penalties, and increased operational expenses.
Energy expert Prof. Joy Ogaji added that some power units experience as many as 22-25 starts and stops each month, accelerating maintenance schedules and pushing planned overhaul times from four years to two.
He advised the Nigerian Electricity Regulatory Commission (NERC) to authorize the purchase of Ancillary Services, including a Spinning Reserve for secondary control.
He also recommended that the System Operator complete and activate the SCADA project for improved oversight and implement the previously proposed Generation Dispatch Tool (GDT) and the provisions of the Grid Code.
“There is an urgent need for proactive measures to stabilize grid operations and improve thermal gas turbines’ performance,” he concluded
He also warned that without such actions, the costs of generation will continue to rise, exceeding the current average of 59 per cent, due to the reliance on foreign-sourced spare parts.