Blackouts Push Nigerian Manufacturers’ Power Spending to N1.34tn in 2025
By Victor Idajili
Nigerian manufacturers spent N1.34 trillion on alternative electricity in 2025, as persistent blackouts forced factories to depend on diesel generators and other off-grid sources to keep production running.
Data from the Manufacturers Association of Nigeria shows the cost jumped by about 21% from N1.11 trillion in 2024 to N1.34 trillion in 2025.
The rising bill reflects the heavy burden of unreliable grid power on Nigeria’s industrial sector, with companies now footing a large share of the energy needed to run their plants.
MAN data shows spending on alternative power has climbed sharply over the last 10 years, despite some dips.
Manufacturers spent N25 billion in 2014. The figure rose to N59 billion in 2015 and N129.95 billion in 2016.
It then dropped to N117.4 billion in 2017, N93.11 billion in 2018 and N61.38 billion in 2019.
There was a slight increase to N81.91 billion in 2020, before falling again to N71.22 billion in 2021.
The trend reversed sharply from 2022. Spending hit N144.5 billion that year, surged to N781.7 billion in 2023, crossed N1 trillion at N1.11 trillion in 2024, and reached N1.34 trillion in 2025.
“Grid reliability deteriorated significantly, with daily power supply dropping from 16.7 hours in H1 2025 to just 13.1 hours in H2 2025,” MAN, led by Segun Ajayi-Kadir, said.
Because of this, many manufacturers say they can no longer rely on electricity distribution companies for their factories. Instead, they have shifted to gas and LPFO to avoid losses from sudden outages.
Companies that have moved away from DisCos include Flour Mills of Nigeria, Dangote Group, Cadbury, Haffar, Kam Industries, Nigerian Breweries Plc, Lafarge Africa, Procter and Gamble Nigeria Limited, Bank of Industry Ltd, Seven-Up Bottling Company Plc, Dangote Cement Plc, Lekki Port LFTZ Enterprise Limited, Guinness Nigeria Plc, Nestle Nigeria Plc, Aluminium Smelter Company of Nigeria, De-United Foods Industries Limited, Sagamu Steel Nigeria Limited, British American Tobacco Nigeria Limited, Unilever Nigeria Plc, Total E & P Nigeria Limited, and Mikano International Limited, according to the Nigerian Electricity Regulatory Commission.
In 2025, Pure Flour Mills Limited in Rivers State secured a licence to generate 546MW.
Dangote Industries Limited said it generated about 1,500MW in 2025. The Dangote refinery alone runs a 435MW power plant, enough to meet the total power requirement of the Ibadan Electricity Distribution Company.
Other self-generation permits recorded by NERC include: United Cement Company of Nigeria Limited, 105MW; Flour Mills of Nigeria Plc, 70MW; and Lafarge Cement Wapco Nigeria Plc, 90MW.
An earlier survey by Prof. Adeola Adenikinju of the University of Ibadan put manufacturers’ self-generated capacity at 13,223MW. With more firms leaving DisCos, analysts say that figure has grown in the last two years.
Several factories have shut down, citing high energy costs and poor supply.
Louis Carter Industries, a plastic-making company, closed part of its operations.
“We had a major challenge with energy costs, which was quite unfortunate. We were also not getting the raw materials we needed,” said General Manager Ndubuisi Okoli.
Mothers Pride Ventures, which produced pet bottles, nylon and plastic cans in Asaba for over five years, shut down in 2018.
Managing Director Jimoh Dayo blamed the closure on the “inefficiency” of the Benin Electricity Distribution Company.
“The way DisCos are handling power is not the way it should be. They provide electricity to whoever they want. The privatisation of the power sector in 2013 should not have been done. Lack of power supply from them destroyed our business.”
Dr. Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise, said power remains one of the biggest obstacles to industrial growth.
“Power supply continues to be one of the most binding constraints on industrial productivity. Manufacturers are compelled to self-generate energy at enormous cost, undermining competitiveness and eroding profitability,” he said.
“No manufacturing economy can achieve global competitiveness when power is unreliable, logistics are inefficient and capital is prohibitively expensive.”
He urged government to deliver reliable and affordable electricity, accelerate rail investments to cut logistics costs, and strengthen development finance institutions to provide long-term industrial loans at concessionary rates.
Manufacturers have also filed several lawsuits against DisCos and NERC over what they call arbitrary tariff increases. The introduction of the Band A tariff has further raised costs, with industry players warning it could force more factories to close.
“Moving forward, stabilising macroeconomic conditions, improving energy supply, and ensuring access to affordable financing will be critical for sustaining growth and enhancing industrial productivity,” Ajayi-Kadir said.
