Nigeria unveils national integrated electricity policy

Nigeria has unveiled the National Integrated Electricity Policy and Strategic Implementation Plan, a groundbreaking move to transform the country's power sector. The policy, as described by the Minister of Power, focuses on improving sector liquidity, driving investments, and integrating renewable energy sources to enhance grid reliability. Abimbola Banjo, Partner and Corporate Finance Leader at PwC Nigeria, shed light on this pivotal development during a recent interview on CNBC Africa. The National Integrated Energy Policy and Strategic Implementation Plan (NISIP) is a comprehensive framework integrated into the Electricity Act of 2023. This integration aims to harmonize various sectors including power, petroleum, renewable energy, manufacturing, and industries. Nigeria, blessed with abundant resources like water for hydro energy, ample sunlight for solar power, and mineral reserves for battery production, aims to leverage these resources to ensure a stable and reliable energy supply for the future while building local capacity to participate in the energy production process. One key differentiation of this policy document is its holistic approach towards tackling challenges across the entire energy value chain, from generation to distribution and transmission. The document, being part of an omnibus electricity act, addresses longstanding issues that have plagued the Nigerian energy sector. While the strategic implementation plan is still in progress, the provisions of the electricity act and recent constitutional amendments empowering states to play a larger role indicate a shift towards resolving sector-wide challenges through collaborative efforts. In terms of urgent needs within the power sector value chain, the focus begins with generation and the existing capacity of 13,000 megawatts, of which only about 4,500 megawatts reach end-users due to transmission bottlenecks, payment challenges, and inefficiencies. Measures are underway to address these gaps, with recent additions like the Zingiri hydro plant adding 700 megawatts to the grid. The emphasis is now on ensuring efficient distribution to end consumers while tackling legacy debts and improving revenue collection to boost investment in distribution infrastructure. Abimbola Banjo emphasized the importance of resolving transmission and distribution challenges to ensure that the power generated reaches every household effectively. The integration of renewable energy sources like hydro power is a step in the right direction towards meeting energy demands sustainably. Addressing legacy debts and enhancing revenue collection will be critical in driving investments and improving the financial health of the power sector. As Nigeria embarks on this transformative journey with its National Integrated Electricity Policy, the focus remains on leveraging resources, enhancing sector collaboration, and addressing longstanding challenges to achieve a reliable and sustainable energy future.