SOURCE: Frost & Sullivan

March 08, 2011 01:30 ET

Frost & Sullivan: National Integrated Power Projects to Provide Significant Growth Impetus to the Nigerian Electricity Industry

CAPE TOWN, SOUTH AFRICA--(Marketwire - March 8, 2011) - The Nigerian electricity industry is facing several challenges such as a shortage of gas, erratic electricity supply and ageing infrastructure and staff. The government needs to improve its existing infrastructure to reduce transmission and distribution losses and step-up the electricity supply. The national integrated power projects (NIPPs) are expected to create innovative infrastructure and customer base that will boost Nigeria's electricity supply.

New analysis from Frost & Sullivan (, 2010 Updated Overview of the Nigerian Electricity Industry, finds that the market earned revenues of $4.59 billion in 2009 and estimates these to reach $7.24 billion in 2015. The markets covered in this research service are power generation, electricity transmission and electricity distribution.

"The Nigerian Government has embarked on privatisation of the power sector to increase the sector's capacity and efficiency in meeting the unmet electricity demand," says Frost & Sullivan Energy and Power Systems Research Analyst Sandra Ayingono. "Additionally, the rural electrification programme which is still in its infancy stage presents significant opportunities for the growth of the power sector, despite the dissolution of the rural electrification agency (REA)."

The Nigerian installed generation capacity is expected to grow by 37 per cent upon completion of the NIPPs. Therefore, with the country increasing its power generation capacity to meet the rising demand, it will significantly benefit equipment and service suppliers, financiers and major stakeholders.

However, the Nigerian electricity industry is ridden with infrastructural hurdles, resulting in unreliable electricity supply, lack of gas caused by pipelines being vandalised and inadequate maintenance of existing equipment.

"Most units and power plants are dated from the 80s and are overdue for major overhaul," explains Ayingono. "The poor maintenance of electrical infrastructures as well as the overloading of transformers in many areas results in numerous breakdowns that affect the entire electricity system."

The NIPPs along with the maintenance operations in the Nigerian electricity industry create significant opportunities for original equipment manufacturers (OEMs) of generation, transmission and distribution equipment, as well as consultants and distributors.

"Substantial lucrative opportunities also exist in the transmission, distribution and equipment supply sections to complete NIPPs and commission independent power producers (IPPs)," concludes Avingono. "Therefore, the government has pledged more investment to boost the efficiency of the transmission and the distribution companies."

2010 Updated Overview of the Nigerian Electricity Industry is part of the Energy & Power Growth Partnership Services programme, which also includes research in the following markets: Strategic Analysis of the Nigerian Electricity Industry and Strategic Growth Plans of Major Power Utilities in sub-Saharan Africa. All research services included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.

If you are interested in more information on this study, please send an e-mail to Christie Cronje, Corporate Communications, at, with your full name, company name, title, telephone number, company e-mail address, company website, city, state and country.

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2010 Updated Overview of the Nigerian Electricity Industry