Nigeria has one of the largest natural gas reserves in the world. Natural gas serves as the main fuel source of electricity in Nigeria. Despite the abundance of natural gas, power output gap (based on potential power requirements) in Nigeria has remained substantial over the years.
The sector depicts signs of expansion as real GDP growth will continue to accelerate in Nigeria over the coming quarters, benefiting from an uptick in crude oil production and rising government spending – afforded by higher commodity prices.
The electricity, gas, steam and air conditioning sector contributed 0.39% to real GDP in 2017, compared to 0.34% in 2016.
The sector contracted by 16.43% in 2017 mainly as a result of increased generation and successful peace talks in the Niger Delta.
Nigeria in 2017 had a total power generation of 27.6TWH, net consumption of 24.9TWH and net capacity of 13,710MW. Thermal power – mainly oil and gas – constituted the majority of power generation, at 80%; hydropower made up a further 19.9%, with limited contributions by non-hydropower renewable sources.