Nigeria’s Power Crisis May Worsen as Gas Suppliers Halt Supply Over N3.3tn Debt

Nigeria’s electricity crisis may worsen in the coming weeks after gas suppliers halted supply to thermal power plants over an estimated N3.3 trillion debt owed by power generation companies.

The Chief Executive Officer of the Association of Power Generation Companies, Joy Ogaji, disclosed the development, warning that the situation could further reduce electricity generation across the country and deepen the ongoing power shortages.

Ogaji said gas producers had informed power generation companies that they would no longer supply gas to thermal plants unless the outstanding debts are settled. She explained that most electricity generated in Nigeria comes from gas-fired plants, making the disruption a major threat to the stability of the national grid.

According to her, the financial crisis within the power sector has made it increasingly difficult for generation companies to meet their obligations to gas suppliers, as payments for electricity produced are often delayed or incomplete.

Industry data indicates that Nigeria’s power generation has already been fluctuating in recent weeks due to gas supply constraints, forcing operators to reduce output and leading to prolonged outages in many parts of the country.

The situation has raised concerns among stakeholders in the energy sector, who warn that unless urgent steps are taken to address the debt burden and restore gas supply, the country could experience more frequent blackouts. Experts say resolving the financial bottlenecks within the electricity value chain remains critical to improving power supply, as generation companies depend heavily on steady gas supply to operate their thermal plants.

Nigeria continues to grapple with persistent electricity shortages despite reforms aimed at improving the power sector since its privatization in 2013, leaving millions of households and businesses reliant on alternative sources of power.