Power Crisis Persists Despite $3.6bn World Bank Loans
Electricity sector has received at least $3.65 billion in World Bank-backed funding since 2001, yet millions of households and businesses still face unstable power supply, frequent grid collapses, and heavy reliance on generators.
Projects funded over the years include the $100m Transmission Development Project (2001), $172m National Energy Development Project (2005), $400m Electricity and Gas Improvement Project (2009), and more recent initiatives such as the $750m Power Sector Recovery Programme (2020) and the $500m Sustainable Power and Irrigation Project (2024).
Despite these interventions, electricity generation remains below expectations, with the national grid suffering repeated collapses. Businesses and households continue to depend on petrol and diesel generators, driving up costs and reducing competitiveness.
Analysts blame the crisis on weak transmission infrastructure, liquidity shortfalls, gas supply constraints, vandalism, inadequate investment, and policy inconsistencies.
Recent World Bank programmes have shifted focus toward renewable energy and decentralised access, including the Distributed Access through Renewable Energy Scale-up initiative (2023), aimed at expanding solar power in rural communities.
However, the Federal Government recently cancelled $717.7m in undisbursed World Bank financing under the Power Sector Recovery Programme, citing failure to meet reform milestones.
The programme’s closing date was moved forward to May 31, 2026, ending it more than a year early.
Energy expert Prof. Dayo Ayoade of the University of Lagos said corruption and poor governance remain the biggest obstacles.
“Until the power sector is put right, the economy will continue to suffer. Nigerians will continue to suffer. Self-generation doesn’t work because it’s inefficient,” he said.
He called for holistic reforms, including subsidy removal, tariff adjustments to reflect true costs, streamlined institutions, and stronger governance to ensure judicious use of resources.
Culled from The PUNCH