When Zungeru Hydroelectric Power Station began commercial operation in 2023 it added 700 MW of generation and roughly 2.64 billion kWh a year to Nigeria’s tally.
That raw output looked meaningful on paper. The trouble was what happened next: the grid did not, and still does not, have the systems to convert installed megawatts into steady, usable power for homes and factories.
In 2024 the national system showed repeated collapses and chronic under-utilization, headlines noted that while installed capacity is often cited in the tens of gigawatts, actual delivered generation commonly falls into the 3,000–4,000 MW range, leaving large gaps between capacity and usable power.
Zungeru exposed several practical weaknesses. First, integration. The Nigerian Electricity Regulatory Commission approved interim procurement of 450 MW from Zungeru to keep the plant online while off-taker contracts were sorted, a blunt measure that speaks to a deeper problem: the grid could not immediately absorb the plant’s tested output.
Second, losses and liquidity. Technical and commercial losses remain high; regulators recorded transmission loss factor (TLF) figures above targets (8.49% reported in 2023 Q4), and distribution inefficiencies continue to erode the value of new generation.
At the same time, the sector’s revenue shortfalls and tariff gaps limit the cash available to pay for dispatched power, which feeds a cycle where plants run below capacity because the market cannot sustainably buy the output.
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Third, the household and industrial reality. Millions of Nigerians still rely on private generators; multiple sector reports put annual spending on fuel for backup generation near $14 billion. That figure is a fiscal and competitiveness drain that shows how unreliable grid supply translates into real economic cost. Zungeru added capacity, but did not immediately reduce that burden for most households and companies.
Finally, Zungeru highlighted contractual and operational risk. The plant’s construction and handover under a $1.3 billion financing package raised expectations that were only partially matched by institutional readiness: transmission constraints, weak off-take arrangements, and governance gaps limited the plant’s early contribution.
In hindsight, Zungeru served as a diagnostic instrument: a test of Nigeria’s ability to manage scale. Building generation is necessary but not sufficient. The real work is grid integration, commercial viability, and institutional discipline, the unspectacular systems that determine whether megawatts become lights, machines, and productive hours. Until those are fixed, any new plant will reveal the same gap between promise and delivery.
