Senate Declares Power Sector Privatisation A Failure, Mulls Policy Review

The Senate, on Thursday, labelled the privatisation of the power sector, implemented 11 years ago, as a “total failure,” citing the continued lack of reliable electricity supply across the country.

The upper legislative body hinted at the possibility of proposing measures to repeal the privatisation policy.

Senate’s condemnation of the alleged failure of the power sector privatisation policy came to the fore during the consideration of a report presented by its Standing Committee on Power on the investigated frequent national grid collapses and related issues.

The chairman of the committee, Senator Enyinnaya Abaribe (APGA, Abia South), who presented the findings, attributed the persistent national grid failures to factors such as aging infrastructure, abandoned projects worth trillions of naira, regulatory inefficiencies, security lapses, lack of modern monitoring systems like SCADA, and inadequate financial oversight.

Abaribe highlighted that despite substantial investments in electricity infrastructure, the grid has suffered 105 collapses over the past decade.

He revealed the significant costs incurred during grid failures, particularly in restarting power plants.

According to the report, restarting a plant after a grid collapse (known as a “black start”) is considerably more expensive than normal operations.

For instance, while running costs for a plant like Azura, Delta, or Shiroro are approximately $105,000.00, restarting costs can reach $7million per incident. Collectively, grid collapses cost Nigeria an estimated ₦42.5billion for the three plants alone, with broader implications for the entire power sector.

The report emphasised that the National Grid, which is over 50-year-old, is outdated and in urgent need of modernisation to meet current operational standards.

Abaribe also noted other pressing issues, including operational inefficiencies, abandoned projects, regulatory gaps, security challenges, and the absence of Supervisory Control and Data Acquisition (SCADA) systems essential for real-time monitoring and management.

“While it costs $105,000 to run the plant, to restart it will cost $7m. So for anytime we have a shut down occasioned by grid collapse, three plants in Nigeria, that supply most of our electricity, Azura, Delta and Shiroro, to restart the plant cost Nigeria $25m or ₦42.5bn and if we expand it to the rest of the operating plants in Nigeria, it is actually not quantifiable,” he said.

“Aging infrastructure has been identified as a critical factor contributing to frequent grid failures. Many components of the grid are outdated and have not undergone necessary maintenance or upgrades, leading to increased vulnerability to failures.”

Contributing to the debate, Senator Adams Oshiomhole (APC, Edo North) criticised the privatisation policy as flawed and exploitative, stating that it imposed undue financial burdens on Nigerians.

“The Discos are out for profit while they make our people suffer. I never imagined that a private person will collect money for services he did not render and Nigerians are helpless. The privatized power sector is more of a failure now,” he said.

On his part, Senator Abdul Ningi (PDP, Bauchi Central) added that the ongoing failures in the power sector persist due to lack of accountability.

He argued that without sanctions for lapses, the sector’s inefficiencies would remain unaddressed.

He said, “Over the years, nobody has been punished for the lapses of the power sector.

“Reports alone without sanctions will not allow Nigeria to make any headway. The implication is that the problems will continue.”

Following the debates, the Senate stood down the consideration of the report and gave the Abaribe-led committee additional six weeks to do a holistic investigation into the issues in the power sector and report back for further legislative actions.