Dangote refinery’s power output surpasses Nigeria’s decade-long growth

By Abubakar Yunusa

Nigeria’s national grid has seen a modest increase of 760 megawatts over the past eleven years, while Dangote’s refinery has independently generated 1,500 megawatts in a fraction of that time.
For years, Nigerians have endured chronic power shortages, with promises of improvements frequently dominating political campaigns. Despite this, the country’s progress has been slow.
Data from the Nigeria Electricity System Operator reveals a 22% increase in power generation from 3,400 megawatts in 2013 to 4,160 megawatts by June 2024. However, Dangote’s refinery, completed in 2018, alone produces 1,500 megawatts.
“We don’t put pressure on the grid. We produce about 1,500 megawatts of power for self-consumption,” Aliko Dangote stated at a recent forum in The Bahamas.
This disparity has sparked debate over the slow pace of the country’s power sector growth, despite significant investments and the 2013 privatization of the sector.
“While there has been some growth since 2013, it hasn’t significantly benefited the public. Most conglomerates generate their power,” noted Charles Akinbobola, a senior energy analyst at Sofidam Capital.
Nigeria’s current production capability stands at 13,000 megawatts, far below South Africa’s 58,095 megawatts, even though Nigeria has a larger population.
Despite improvements, Nigeria’s outdated grid only delivers about 4,000 megawatts to over 200 million people, compared to the city of Edinburgh’s 548,000 residents receiving a similar amount of power.
From 2013 to 2024, Nigeria’s transmission capacity increased by 20% to an average of 4,200 megawatts, while the population grew by 57%, according to World Bank estimates.
In contrast, other African nations are advancing swiftly. Egypt added 28,229 megawatts between 2015 and 2018, raising its total capacity to 58,818 megawatts, thanks to efficient fast-track projects.
Similarly, Ghana increased its electricity generation capacity from 1,358 megawatts in 2000 to 4,695 megawatts by 2020, growing at an annual rate of 6.4%.
“Nigeria’s power sector issues are a major economic conundrum, plagued by funding and liquidity crises, posing significant risks to investments,” Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise, highlighted.
The inefficiencies in Nigeria’s power sector have forced industries to self-generate over 14,000 megawatts, costing manufacturers billions on alternative energy.
Documents from the Manufacturers Association of Nigeria show that between 2014 and 2021, member companies spent N639 billion on alternative energy sources, illustrating the severe impact of unreliable power supply on the nation’s economy.