Power Sector Reform in Nigeria: Challenges and Solutions

Abstract

Deregulation of electricity sector in Nigeria has brought to the fore, the need to explore power generation options for the improvement of power capacity, reliability, and availability. One of such options is the paradigm shift from centrally generated electricity to generation at the distribution level. Embedded generation is an emerging concept in the electricity sector, which represents good alternates for electricity supply instead of the traditional centralized power generation concept, though relatively new as a viable option in Nigeria. Embedded generation (EG) refer to any electric power production technology that is integrated within distribution systems, close to the point of use. EG saves cost due to on-site production which avoids transmission and distribution costs and hence, a saving of about 30% of the cost of delivered electricity. Also, on-site production of energy reduces loss of generated power due to transmission and distribution. It also improves the level of power quality and reliability aside from serving niche applications for remote sites. Distributed or embedded generation can provide standby generation (emergency power), peak shaving capability and cogeneration. It improves the efficiency of the power grid by having multiple micro-sources added to the system. Embedded generators are usually connected to the medium or low voltage grid. This paper therefore reviews power sector reform in Nigeria and its challenges. It presents the way forward for epileptic power supply by embracing embedded generation as a potential option to improving power supply in Nigeria.