Natural Monopoly in the Privatized Nigeria Power Industry and Sustainable Service Delivery: An Assessment of the Ikeja Electricity Distribution Company as a Microcosm of the Post-Privatization Electricity Distribution Companies in Nigeria

Abstract

The electricity industry in Nigeria was privatized in 2005 giving rise to Electricity Generating Companies (Gencos), Transmission Company of Nigeria (TCN), and Electricity Distribution Companies (Discos). In particular, 11 companies emerged in the country each with an allotted operational zone. The industry has been operating as a natural monopoly. The objective of the study was to establish that the natural monopoly of the Nigeria electricity power industry has a significant effect on the ability of the Ikeja Electricity Company to deliver sustained power supply to consumers. Within the operational domain of Ikeja Electricity Distribution Company, the study concentrated on the electricity consumers in Alimosho Local Government Area which is the largest Local government Area in Lagos State. The sample size was 377 calculated using Raosoft sample size calculator. Out of the 377 copies of the questionnaire administered, 311 were returned fully completed representing a response rate of 82.49%.The analysis of data was done with Z test. There were 10 findings. The only hypothesis of the study shows that the natural monopoly of the Nigeria electricity power industry in which the Ikeja Electricity Distribution Company operates has a significant effect on its ability to deliver sustained power supply to consumers. The recommendation is that the distribution segment of the market be deregulated to give rise to competition.