Nigeria’s electricity generation companies (GenCos) have lost an estimated ₦2.31 trillion over the past twelve years to stranded power — electricity that could have been generated and distributed but was left unused due to persistent grid and operational constraints.
The figure, covering 2013 to September 2025, was disclosed by the Association of Power Generation Companies (APGC) during its 20th anniversary celebration and highlights the worsening financial crisis in the nation’s power market.
According to the APGC Managing Director and Chief Executive Officer, Dr. Joy Ogaji, the losses represent the monetary value of power generation capacity that was available but not evacuated by the national grid or distributed to consumers.
“All this power that is stranded, that is not being used, there is a capacity charge to it, and that is what this data captures,” Ogaji explained. “What the GenCos are asking the government to pay now doesn’t even include this. What we are owed is only for energy, not capacity.”
A Decade of Wasted Power
The data sourced from the National Control Centre reveals that Nigeria’s generation companies routinely declare between 6,000MW and 7,000MW of available capacity, yet the national grid only evacuates about 4,500MW, leaving more than 2,000MW stranded each year.
Between January and September 2025 alone, 2,221.99MW of generation capacity went unused, resulting in ₦119 billion in lost payments. This translates to roughly 32 per cent of potential power being wasted monthly.
A year-by-year breakdown shows staggering losses:
- 2015: 3,010MW stranded — ₦214.93bn lost
- 2016: 3,827MW stranded — ₦273.32bn lost (worst year on record)
- 2017: 3,311MW stranded — ₦236.47bn lost
- 2018: 3,698MW stranded — ₦264.08bn lost
- 2019: 3,597MW stranded — ₦256.85bn lost
- 2020: 3,742MW stranded — ₦266.10bn lost
Although losses began to ease after 2021, they have remained significant, averaging over ₦150bn annually.
Systemic Failures and Policy Breaches
Nigeria’s power sector was privatised in 2013 with the promise of improved efficiency and investment. However, the APGC says the performance agreements signed with the Bureau of Public Enterprises (BPE) — which guaranteed uninterrupted gas supply, full payment for energy and capacity, and grid access — have not been honoured.
Ogaji blamed the Nigerian Bulk Electricity Trading Plc (NBET) for irregular capacity payments and poor market liquidity.
“At the beginning, GenCos were paid capacity charges. But once NBET was introduced, the payment story changed. Even though GenCos have grown capacity and maintained their plants, the grid cannot take what we produce,” she said.
The situation, she added, has eroded investor confidence and hindered maintenance and expansion efforts.
“The non-payment of capacity charges undermines the bankability of GenCos. Without a sustainable payment mechanism, it will be impossible to finance major maintenance or expand the total national supply.”
Over 10,000MW of Stranded Generation
The Minister of Power, Adebayo Adelabu, recently confirmed that Nigeria has more than 10 gigawatts (10,000MW) of stranded generation capacity nationwide, calling it a symbol of waste in a country still plagued by blackouts.
“Generation is not our immediate problem today,” Adelabu said. “We have energy being generated all over the country that we are not even using. The challenge lies in stable transmission and effective distribution.”
He lamented that power plants capable of lighting homes and industries have been left idle despite massive investments, describing the situation as “wasteful and economically damaging.”
Economic Toll of Stranded Power
The APGC estimates that a 1 per cent increase in power supply could raise Nigeria’s GDP by up to 3.94 per cent. Thus, the cumulative losses from stranded electricity have significantly stifled economic growth, industrial productivity, and job creation.
If even half of the stranded 2,000–3,000MW had been consistently delivered to consumers and industries, Nigeria’s economy could have grown by an additional 10–12 per cent over the last decade, the group noted.
“Electricity drives industrialisation and employment,” Ogaji stressed. “Nigeria cannot achieve economic expansion when power plants sit idle.”
Charting a Way Forward
To end the recurring cycle of losses, the APGC urged the Federal Government to:
- Honour all contractual obligations under existing power purchase agreements.
- Strengthen transmission and distribution infrastructure to improve evacuation.
- Ensure full and timely payment of GenCos’ capacity and energy invoices.
- Encourage private investment in grid expansion and gas supply.
- Promote bilateral contracts and off-grid alternatives to reduce pressure on the national grid.
The group insists that unless urgent reforms are implemented, Nigeria’s power sector will continue to bleed billions annually — and the dream of reliable electricity supply will remain out of reach.
“We have the capacity to power Nigeria’s growth,” Ogaji concluded. “What we need is a system that allows generated power to reach the people who need it most.”