The National Integrated Electricity Policy of Nigeria: The transmission infrastructure challenges

This article is a follow-up on the last two articles in this column titled “The National Integrated Electricity Policy of Nigeria: A Review”, parts one and two. It is entirely focused on the transmission infrastructure of the Nigerian Electricity Supply Industry (NESI). The article will be reviewing the plan for the transmission sub-sector in the National Integrated Electricity Policy (NIEP), highlighting the challenges of power transmission in Nigeria and suggesting the way forward.

Power supply consists of three major activities – power generation, transmission and distribution. The Transmission Company of Nigeria (TCN) emerged as one of the 18 companies after the unbundling of the erstwhile National Electric Power Authority, NEPA, to become the transmission component of power supply in Nigeria. It was the result of the merger of the transmission and the operations departments of the defunct NEPA. TCN provides the transmission backbone for the national electric power grid in Nigeria. It is through TCN’s public power grid that the power produced by the power-generating companies (GenCos) is evacuated and transmitted to power distribution companies (DisCos) for onward connection to homes, offices, factories and other consumers.

Read also: The National Integrated Electricity Policy of Nigeria: A review (part one)

According to the NIEP in section 1.6.2, “TCN manages a grid spanning nearly 18,000 kilometres of high-voltage transmission (330 kV and 132 kV) lines, taking power from the about 29 generating stations through over 200 330/132 kV and 132/33 kV transmission substations to DisCos, directly connected customers and international customers… However, critical areas of deficiency remain; for example, most of the Northwest and the entire Northeast are served by radial single-circuit transmission lines, meaning that any outage on these lines would leave the entire region without service. Despite extensive capacity expansion over the years, the national transmission network is still severely constrained by equipment obsolescence and a relatively high technical loss level of 7 percent to 9 percent.”

What the foregoing simply shows is that despite over forty years of tinkering, the transmission sector remains the weakest link in Nigeria’s power sector. TCN only recently, on March 4, 2025, achieved a new peak power supply of 5,713 megawatts (MW). The current evacuation capacity of TCN is 8,500 MW, with plans to expand it to 10,000 by 2027.

“Addressing these challenges requires significant upgrades to the existing infrastructure, including the integration of modern automated systems for real-time grid management and investment in reliable ancillary services.”

Under the National Integrated Electricity Policy and the Electricity Act 2023, TCN is to be unbundled into a Transmission Service Provider, an Independent System Operator and a Market Operator. Concerning TCN’s role as a systems operator, the NIEP states, thus, in section 1.7, “Unfortunately, the system operation function still relies on manual systems that impede efficiency. There is also a shortage of essential ancillary services, the lack of which compels the System Operator (“SO”) to rely heavily on the unsustainable practice of using under-frequency relays to maintain grid stability. Moreover, the SO must often instruct generating units to reduce their output below nominated levels due to transmission constraints, gas supply issues and/or load rejection by DisCos. The grid’s lack of effective protective devices is also a major concern due to the abnormally high rate of consequent blackouts or system collapses. Addressing these challenges requires significant upgrades to the existing infrastructure, including the integration of modern automated systems for real-time grid management and investment in reliable ancillary services.” In response to these challenges, perhaps, the NIEP in section 3.3 provides for electricity transmission to be “opened for private investment by licensing Independent Electricity Transmission Network (IETN) operators to build, operate, and own electricity transmission networks at 132 kV and 330 kV levels.”

None of the foregoing is meant to show TCN in a bad light or to denigrate the effort of Engr. Sule Ahmed Abdulaziz, Managing Director/CEO of TCN, and his team of dedicated professional engineers and administrators. Indeed, a great deal of work is ongoing at TCN, including capital projects and rehabilitation efforts across the country. Various funds are also being channelled into the transmission upgrade. These include the N150 billion and the $800 million to be spent under the Presidential Power Initiative (PPI) and the $200 million World Bank-funded transmission projects. Indeed, the power sector under the able leadership of the Minister of Power, Chief Adebayo Adelabu, is a beehive of activities due to a strong commitment to implementing the provisions of both the Electricity Act 2023 and the Nigerian Integrated Electricity Policy and the Nigerian Integrated Resource Plan for the power sector.

However, it is evident that the structural weaknesses and the infrastructural inadequacies of our national power transmission grid are so far-reaching that it will require the injection of enormous amounts of capital to the tune of billions of dollars within the next five years (2025-2030), which the federal government cannot mobilise. The licensing of Independent Electricity Transmission Network (IETN) operators in a transmission system that is still fully government-owned and -run may not generate the desired responses from private investors.

Read also: The National Integrated Electricity Policy of Nigeria: A review (Part Two)

As far-reaching as the reforms in the Nigerian Integrated Electricity Policy are, they are largely administrative reforms. These need to be complemented by market-orientated or ‘market-facing’ reforms, where economic agents in the electricity market – producers, sellers, buyers, suppliers of gas, finance, equipment, investors, etc. – own, supply, sell and buy assets and services and determine market ruling prices. This will guarantee transparency, sound governance practices, efficiency and effectiveness and fair prices. This presupposes complete privatisation of all power sector assets and full deregulation of the power sector. In an article titled “Reforms, not increased funding, critical to boosting power transmission,” written by Kingsley Jeremiah and Waliat Musa, published in the Guardian Newspaper of Nigeria on January 27, 2025, they stated that the Federal Government had borrowed $7.5 billion in the last 11 years from the World Bank, African Development Bank and the Japanese and French development agencies, among others, to improve the wheeling capacity of TCN, but the capacity of the grid remained at about 4500 MW.

The full realisation of the laudable policy objectives of the Nigerian Integrated Electricity Policy for all segments of the Nigerian Electricity Supply Industry – power generation, transmission and distribution – cannot be realised without the full privatisation of government-owned power assets in all segments of the power value chain.

 

Mr Igbinoba is Team Lead/CEO at ProServe Options Consulting, Lagos