Electricity sector reform and Nigeria’s national security imperative

National security, traditionally associated with territorial defence and law enforcement, has evolved into a modern multidimensional concept that includes economic resilience, food security, public health and, crucially, energy security. As Funmi Olonisakin, Professor of Peace and Conflict Studies at King’s College, London, suggests, the modern concept of national security, in plain terms, is the totality of activity that a government undertakes to enable its citizens to live long and live well. One of those things is ensuring that electricity is supplied to all who need it, reliably, constantly, sustainably and affordably.

In the modern state, electricity is the lifeblood of social engagement, public safety, economic and technological competitiveness and productivity. No country that the reader admires has attained its leading position without attaining energy security as a pillar of national security. Probably nowhere on Earth is ensuring full electricity access and thus electricity security now more urgent than in Nigeria where 200-plus million people, 83% of whom are under the age of 40, labour under chronic electricity supply deficits and a fragile socio-economic and internal security landscape. The Nigerian Electricity Supply Industry (NESI), rather than being a bedrock of stability and growth, has often been an obstacle to the county’s development. Despite the global truism that energy security is essential to steady economic development, the NESI has failed through successive Administrations to generate a positive outlook for the country. What must be done to align it to serve as an enabler of national development? Properly considered, this is arguably the single most important socio-economic and national security question in Nigeria today.

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Understanding Electricity Security as a National Security Imperative

Energy security is simply the uninterrupted availability of energy of consistent quality at an affordable price. Electricity security, a subset of this concept, entails reliability of supply (in voltage and frequency parameters), adequacy of infrastructure, resilience against physical and cyber threats and, of course, affordability and accessibility for the citizenry. Recognising this, the National Integrated Electricity Policy (NIEP), very recently approved by Mr. President and the Federal Executive Council, defines its objectives as healthy capitalisation, universal access and electricity reliability. A country that cannot secure these three critical elements of electricity security exposes itself to grievous internal vulnerabilities and external threats.

Electricity powers critical infrastructure, both hard (water, ICT, transportation) and soft (education and healthcare), industrial production and job creation, national defence systems and citizens’ personal comfort and quality of life. In developing economies, chronic electricity shortages fuel insecurity by deepening poverty, reducing state legitimacy and enabling non-state actors to provide alternative “services.” All three ailments, unfortunately, deeply assail Nigeria and so, faced with the unenviable record of having the largest number (estimated 86m) of its citizens on Earth without electricity, electricity security in the country can no longer be seen as merely an economic goal, it must be declared and made to be a national security imperative.

The Nigerian Context: Chronic Power Deficits as a National Vulnerability

Nigeria’s energy paradox – electrically impoverished but immensely rich in gas and renewable energy potential – is well-known and is the perennial subject of all manner of conferences and workshops ad nauseam. However, our key electricity challenges are often discussed individually because each is often mistaken for the whole. They include low generation capacity/energy in the past year of average 4,500MW/110,000MWh daily delivered with middling to poor quality of service standards to approximately 13m grid-connected consumers in a population of over 200 million.

This is weighed against the country’s alternative fleet of over 15m diesel- and petrol-powered backup generator sets with aggregated capacity over 40,000MW that actually powers the country. In the past 40 years, we have deeply normalised the massive loss of productivity and inflation of energy costs this dependency causes. It is so much so that we do not realise that Nigeria’s grid-connected generators compete not against each other but against the alternative genset and diesel supply markets that industry, large commercial players and the Federal and State public sectors actually depend on.

Nigeria also has an unreliable transmission grid with brownouts and blackouts occurring annually in numbers that are unheard of amongst its peer BRICS countries. We also have unacceptably high technical and commercial losses that lead to unacceptably high energy and revenues losses. These are compounded by extensive vandalism of pipelines, transmission towers, and electricity installations, particularly in the Niger Delta and North-East.

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These systemic issues threaten national security primarily in five ways. First, they weaken the nation’s industrial, large commercial and SME base and their ability to create skilled and highly productive jobs, goods and services. In turn, this fuels poverty, lack of social mobility and mass migration, particularly of skilled workers and professionals. Second, it deeply erodes trust in the public sector’s ability to deliver government services, worsening the terrible relationship between the public sector and the citizenry. Third, in a country whose military is stretched thin on the ground undertaking internal security and support to civil authority duties, Nigeria’s energy deficit empowers insurgents, terror groups and bandits to conduct operations against the military and recruit from among our unemployed and impressionable youths. Fourth, it increases operating costs and diminishes the operating tempo and readiness of the armed forces, law enforcement and intelligence agencies, given energy deficits in military barracks, command centres and national security communications networks. Finally, Nigeria’s electricity deficit and sabotaged electricity infrastructure leaves the national digital infrastructure – banking and financial services, ICT and the significant national databases harboured in them – increasingly vulnerable to expensive and/or irreparable damage by malicious actors.

NESI as a Brake on Development

These various electricity sector challenges have cascaded into multiple obstructions to its development that manifest in various ways. For example, we have witnessed policy and regulatory instability seen in precipitate changes in market design and tariff structures, the poor design and administration of subsidy regimes and the manner in which policy initiatives and regulatory orders are announced only to be quietly abandoned later and rather weak compliance and enforcement mechanisms. All these undermine fair competition and investor confidence.

Second is the historical over-centralisation of the sector. Until the Electricity Act 2023 came into force, the NESI was centrally controlled from Abuja in terms of policy making, regulation and operations. This meant the marginal involvement of the 36 States that host electricity distribution networks. While States and their citizenry made very significant contributions to the Discos’ asset base, these were taken without formal recognition or attribution and without mobilising the States’ latent natural advantage in ensuring that Discos took consumer protection and education and customer as key factors in delivering quality service.

Third, decades of low and poorly deployed capital expenditure, poor quality corporate governance and executive management, and mismatched and misapplied Federal Government subsidies have embedded insolvency, underinvestment, poor quality of service and deep-seated dissatisfaction across the entire value chain from fuel supply down to the last customer.

Fourth, until the review process was undertaken that delivered the National Integrated Electricity Policy approved by Mr. President and FEC a few weeks ago, there had been no institutional effort to seek collaboration and alignment with industrial policy, fiscal and monetary policies, other energy policies, national security strategies or continental and ECOWAS sub-regional development plans.

Repositioning NESI as a National Enabler: An Agenda for Strategic Evolution

To make the NESI an enabler of development, six distinct points may be borne in mind. First, the Federal Government, particularly the Nigerian Electricity Regulatory Commission (NERC) must make a deliberate and concerted effort to go beyond rhetoric, adopt a more collaborative and supportive stance and take steps to bring the NESI to embrace the orderly growth/evolution of State-level and domestic sub-regional electricity markets under the Electricity Act 2023. NERC can and should support State authorities to develop the regulatory and commercial and financial foundations/designs of the State markets.

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Second, States themselves need to develop the human capital needed to manage credible policymaking and regulation at State level. Furthermore, the 36 States and the FCT, by nature, by the amended 1999 Constitution, by the NIEP and by Electricity Act, are the locus of decentralising generation, distribution, policymaking and regulation. They are responsible for driving competition and service quality. Supporting their entry into the frame of policymaking, regulatory engagement and market design should be seen as bringing much needed focus to attaining the national policy goals of healthy capitalisation of licensee companies, universal access for consumers of all classes and the reliability of transmission and distribution networks.

Third, States must, regardless of their shortage of financial and human resources, seek to focus particularly on encouraging new entrants into the expansion of off-grid and mini-grid systems. The evolution to grid resilience and the widespread cost-effective deployment of decentralised energy solutions and investments in smart grids and energy storage, thus enhancing grid reliability, especially in conflict-affected or rural areas, can only happen to full effect in, and if driven by, the States.

In this regard, special energy corridors or embedded generation schemes should be deliberately designed not only to serve unserved and underserved communities but also military bases, border communities, critical public facilities, and emergency services.

Fourth, securing and protecting critical energy infrastructure is a function of strengthening statutory provisions and community partnerships to prevent sabotage. Deploying cutting edge electronic surveillance, intelligence gathering and analysis capabilities and tools and the extensive recruitment, training and deployment of the Nigeria Civil Defence and Security Corps, which already has the statutory role of supporting the protection of critical national infrastructure, is vital to supplementing military internal security task forces.

Fifth, the NESI, at both Federal and State levels cannot grow without designing and implementing a far-reaching programme to reset the NESI’s commercial and financial viability. Such a programme can be detailed as part of the Strategic Implementation Plan that, under the Electricity Act, 2023, is required to follow the NIEP. The ideal programme will propose a set of corporate actions and commercial transactions undertaken by various stakeholders and market participants to clear legacy liabilities, bring in better quality shareholders and fundamentally reset both the prevailing transmission and distribution cost base and the manner in which the Multi-Year Tariff Order (MYTO) tariff methodologies is applied. Ultimately, the transmission and distribution sub-sector balance sheets have to be comprehensively restructured and made bankable and thus ready for new shareholders and capital injections from private capital and DFIs.

Finally, the underlying point of this essay – embed electricity security, as a non-negotiable strategic objective and a key element and instrument of national power, within Nigeria’s national security architecture by making electricity system planning and the formulation of access programmes a foundational pillar of counter-insurgency strategy, regional development, border security, anti-poverty programmes and digital infrastructure resilience. In addition, electricity system planning should also evolve into being a key element in civil-military energy infrastructure coordination and protection. This will be by formalising partnerships between NERC, State Regulators, TSP, NISO, Discos and Defence HQ/Ministry of Defence to protect, sustain and increase electricity infrastructure and supply across the country.

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Conclusion: For an Electrified and Secure Nigeria

In an era of global competition and internal fragility, electricity security is the foundational enabler for a country’s capacity to safeguard its sovereignty and territorial integrity and project its socio-economic influence within its sub-region. It is not far-fetched to assert that Nigeria’s national security strategy is incomplete without embedding its electricity sector reliability, affordability and alignment with strategic national development goals. For the sake of our collective future, the Nigerian Electricity Supply Industry must be transformed and reimagined—not merely as a utility ecosystem, but as a core institution of national power. Through regulatory reform, decentralised energy planning, corporate and commercial restructuring and investment in resilience, the NESI can go from being a liability to being the primary driver of peace, productivity and long-term stability, converting a chronic national vulnerability into a strategic advantage.

Eyo O. Ekpo, Team Leader-Power, United Kingdom Nigeria Infrastructure Advisory Facility. Formerly a Commissioner, Market Competition and Rates, NERC. He also holds a Master’s degree in War Studies from King’s College, London.