NIGERIA POWER CRISIS – Billions Spent, Little to Show: Investigating Nigeria’s Power Crisis Since 1999

Introduction: High Hopes and Dim Lights

When Nigeria returned to democracy in 1999, citizens were promised that decades of darkness would give way to light. The country, blessed with rivers and enormous energy needs, looked to hydroelectric and thermal power as pillars of its electricity supply. Yet more than two decades later, the reality is a crippling power crisis. National output still hovers below 5,000 megawatts for a population of over 200 million. Billions of dollars have been poured into the power sector across successive democratic governments with little to show. Nigerians have been left to rely on costly petrol and diesel generators, creating a parallel generator economy that often produces more power than the national grid.

This report examines how Nigeria’s power generation dreams, particularly in the hydroelectric and thermal subsectors, have been hobbled by mismanagement and corruption across each administration since 1999. It follows the money trail of lavish budgets, failed reforms, and the litany of broken promises.

1999 to 2007: Obasanjo’s Ambition and the $16 Billion Question

President Olusegun Obasanjo began his tenure with a pledge to fix electricity. His government increased power sector funding dramatically, spending approximately 374 billion naira from 1999 to 2006. This funded rehabilitation efforts for Kainji and Jebba dams and initiated the National Integrated Power Projects. The flagship initiative was meant to add 10,000 megawatts through new stations and transmission lines. Obasanjo also launched the process of privatizing the power sector and created the Nigerian Electricity Regulatory Commission through the 2005 Power Reform Act.

One notable project under his administration was the long-planned Mambilla Hydroelectric Project. In 2003, the project was controversially awarded to Sunrise Power without Federal Executive Council approval. The resulting contractual dispute would stall Mambilla for the next two decades.

Obasanjo’s administration claimed to have doubled generation to 3,500 megawatts. However, by 2008, a parliamentary probe revealed that despite claims of $16 billion spent on power, there was no corresponding increase in generation. The committee reported that many contractors were paid without delivering any work, and 34 non-existent companies had been awarded contracts. Obasanjo denied wrongdoing and blamed sabotage and infrastructure decay.

The Siemens bribery scandal further dented the sector’s reputation. Between 2001 and 2004, Siemens AG admitted to paying bribes to Nigerian officials to secure power contracts, leading to contract cancellations and blacklisting.

2007 to 2010: Yar’Adua’s Short-Lived Reform

President Umaru Musa Yar’Adua inherited a troubled sector. Declaring a state of emergency in power, he pledged to clean up the system. His administration spent approximately 369 billion naira, similar to his predecessor, but slowed down implementation by suspending ongoing projects for audit.

Yar’Adua continued the investigation into Obasanjo’s power expenditures. The House probe found that billions were spent with little to no result, and contracts were awarded to unqualified companies. Despite strong rhetoric, Yar’Adua’s administration refrained from prosecuting any key figures, including his predecessor.

Mambilla remained in limbo. The new contract signed with Chinese firms in 2007 was canceled in 2009 due to ongoing legal disputes with Sunrise Power. Other hydropower developments remained minor or faced similar delays. By 2010, power generation still hovered around 3,000 megawatts.

2010 to 2015: Jonathan’s Privatization Gamble

Goodluck Jonathan sought to restructure the power sector fundamentally. In 2013, the Power Holding Company of Nigeria was unbundled into six generation and eleven distribution companies, most of which were privatized. This fetched about 404 billion naira and marked the largest reform since 2005.

Mainstream Energy took over Kainji and Jebba, while North South Power assumed Shiroro. These private firms managed to restore some lost capacity. Meanwhile, Zungeru Hydropower Project, initiated in 2013 with Chinese financing, faced multiple setbacks including community litigation and funding gaps, delaying its completion.

Mambilla was again revived with a general agreement including Sunrise Power, but little progress was made. Although Jonathan’s reforms were bold, they were marred by poor implementation and allegations of political patronage in asset sales. The government continued to inject subsidies and bailouts into the sector.

By 2015, generation had increased slightly to around 4,500 megawatts. Jonathan acknowledged that power was still a major challenge but insisted his government had laid a solid foundation.

2015 to 2023: Buhari’s Anti-Corruption Crusade

Muhammadu Buhari came to power with a vow to fight corruption and revive infrastructure. He criticized his predecessors for squandering 16 billion dollars on power without results. His administration continued subsidies, bailing out the sector with over 1.7 trillion naira. He also launched the Presidential Power Initiative with Siemens in 2020 to upgrade the grid.

Buhari’s years saw the long-delayed Zungeru Hydropower Plant completed in 2023, contributing about 700 megawatts. However, most of the grid remained fragile. Generation rarely exceeded 4,500 megawatts.

Mambilla remained in legal turmoil. Buhari’s decision in 2017 to re-award the contract to new Chinese firms without resolving Sunrise’s claims led to arbitration and a 2.3 billion dollar lawsuit against Nigeria. In 2022, the Economic and Financial Crimes Commission indicted a former minister over the original contract. Buhari’s anti-corruption efforts were lauded, but no major convictions occurred in the power sector.

2023 to Present: A New Approach

President Bola Tinubu inherited a sector riddled with debt and inefficiency. His administration passed the Electricity Act 2023, decentralizing power generation and allowing states to participate. This marks a significant shift from the federal monopoly.

The 2024 budget earmarked 344 billion naira for power, including 100 billion for renewables. Tariffs have increased sharply to reflect costs, though public dissatisfaction remains due to persistent outages. Hydropower assets like Zungeru and Shiroro are now operational but not at full capacity.

The Mambilla project remains stalled, its fate now in Tinubu’s hands. Resolving the legal dispute and unlocking financing could finally put the 3,050 megawatt project on track. If completed, it would be the largest in sub-Saharan Africa.
been promised.
Sources available upon request.

Conclusion: A Damning Indictment of Waste and Mismanagement

Since 1999, Nigeria has spent over 30 billion dollars on its power sector. Yet the country still struggles to deliver stable electricity to its citizens. Hydropower, once seen as the nation’s cleanest and most promising energy source, has been hindered by corruption, poor planning, and endless litigation.

Each government made promises. Each spent lavishly. Yet, progress has been painfully slow. Mambilla remains unbuilt. Kainji and Jebba, built decades ago, still carry much of the hydro burden. New dams like Zungeru arrived years late.

The lessons are clear. Without transparency, consistency, and political will, megawatts remain on paper. Nigerians deserve better. Reliable power is not a luxury but a necessity. It is time for Nigeria to turn the page on a dark chapter and finally deliver the light its people have long been promised.

Sources available upon request.