Market reform in the Nigeria power sector: A review of the issues and potential solutions

Wale Arowolo and Yannick Perez

Energy Policy, 2020, vol. 144, issue C

Abstract: The Nigeria Power sector reform was performed between the year 2010 and 2013 but it has undoubtedly been adjudged unsuccessful by most stakeholders. The failure of the reform is evidenced by a myriad of seemingly insurmountable economic, institutional, technical, financial and socio-political challenges exacerbated by the recent macroeconomic crisis. This paper performs a comparative analysis of the Nigeria reform with the “Standard model” of electricity reform to understand the root cause of the reform failures while taking cognizance of the starting conditions of Nigeria. Our result reveals that incomplete privatization coupled with the horizontal integration of the transmission and network operations, the underdeveloped gas supply infrastructure network and the ineffective/weak regulatory framework as the root problems. Thereafter, we recommended strengthening the regulatory framework as a good starting point to resolve sectoral problems. We argued that, considering the depth of the regulatory concerns, strengthening the framework will resolve the problems of investment, access and pricing and improve the overall sectoral performance (ex-post). Furthermore, we recommended the need for a workable market design and regulatory framework for decentralized solar PV generation and integration that is adaptable and nicely fits with a strengthened centralized generation framework.

Keywords: Nigeria Power sector; Market reform; Market design; Institutional design; Energy policy (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:144:y:2020:i:c:s0301421520303207

DOI: 10.1016/j.enpol.2020.111580

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