Nigeria has not financed a single major new power plant in over a decade, and the man who once ran the country’s electricity sector says he knows precisely when the clock stopped.
Bartholomew Nnaji, the former Minister of Power who oversaw Nigeria’s electricity privatisation drive under President Goodluck Jonathan, told an audience of energy economists in Lagos on Monday that the country’s chronic power deficit is not simply a story of bad infrastructure or insufficient gas supply.
It is, he argued, the story of a financing instrument that worked, and was then quietly killed.
Speaking at the 19th International Conference of the Nigerian Association of Energy Economics (NAEE), Nnaji said a partial risk guarantee framework jointly developed by the ministries of power and finance during his tenure had begun drawing global capital into Nigerian electricity generation projects before it was dismantled by a succeeding administration.
That dismantling, he said, froze Nigeria’s power investment pipeline and the freeze has never thawed.
“A number of companies developed their power plants to the level where they could just finance them. And the world was galloping to us to finance power plants, because we were getting a service guarantee,” Nnaji said.
“As soon as the government changed, it got wiped away. And till today, we have not financed any new major power plant in Nigeria. That’s about 11 years ago.”
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The partial risk guarantee instrument, as Nnaji described it, was a deliberate architecture: a government-backed mechanism designed to make Nigerian power projects bankable by shielding international lenders and developers from the country’s well-documented regulatory and off-taker risks.
Rather than asking investors to price in Nigeria’s full political risk premium, the framework transferred a portion of that risk onto the sovereign balance sheet, effectively serving as a co-signature to deals that would otherwise have stalled.
Such instruments have proven effective elsewhere. The World Bank’s Multilateral Investment Guarantee Agency and the African Development Bank have deployed comparable tools across Sub-Saharan Africa with measurable results. Nigeria’s version, Nnaji said, was producing results too, before policy discontinuity erased it without a replacement.
The consequences have been lasting. Nigeria’s electricity sector, despite a headline installed generation capacity of roughly 13,000 megawatts, routinely dispatches less than 5,000 megawatts to the national grid, enough to power a mid-sized European city, not a continent-sized economy of more than 220 million people. The deficit costs manufacturers, hospitals, and small businesses billions of dollars annually in diesel-fuelled workarounds, and has repeatedly been cited as among the primary constraints on industrial output and foreign direct investment.
Nnaji attributed the stagnation to three converging failures: policy inconsistency, weak infrastructure development, and the absence of a viable financing framework to mobilise private capital at scale.
Mambilla and the Infrastructure Backlog
Among the projects that have remained trapped in Nigeria’s financing and planning paralysis is the Mambilla hydropower scheme, a 3,050-megawatt facility on the Taraba plateau that has spent decades cycling through feasibility studies, contractor negotiations, and government commitments without breaking ground.
Nnaji addressed the project’s continued delay as emblematic of the deeper dysfunction: the country’s inability to execute on large-scale energy infrastructure even when the resource base, the technical plans, and the political will nominally exist.
Mambilla, if completed, would represent one of Africa’s largest hydropower installations. Its continued stasis is, for many observers, a reliable measure of how much Nigeria’s infrastructure ambitions consistently outpace its institutional capacity to deliver them.
Nnaji used the platform to push back against what he characterised as the ideological overcorrection embedded in global energy transition narratives, and to make the case that Nigeria must chart a course anchored in economic reality rather than external pressure.
He pointed to the Russia-Ukraine war as the moment that exposed the limits of that ideological framing.
When energy security suddenly trumped climate symbolism for European governments, the continent’s aggressive renewable agenda gave way almost overnight to emergency coal reactivations and liquefied natural gas procurement drives.
“Europe, which had been harassing the entire world about renewable energy, was the first to abandon the paradigm,” he said. “And Germany, for example, went back to coal, which is the biggest pollutant in the world.”
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