At the 2025 Lagos State Energy Summit held in Victoria Island, former Minister of Power and Chairman of Geometric Power Group, Professor Bart Nnaji, delivered a sweeping keynote address that traced Nigeria’s power sector reform journey, applauded Lagos’ bold new steps, and offered a sobering caution on the limits of state-led energy ventures. But his address, while rich in context and experience, has reignited debate over whether states should do more – perhaps even subsidize power delivery—in pursuit of reliable electricity for all.
Professor Nnaji, widely credited for the 2010 Roadmap for Power Sector Reform under President Goodluck Jonathan, reminded the summit attendees that Lagos has always played a pioneering role. “As the Minister of Power in 2012, I had the honour to commission the 10MW gas-fired plant built by the Lagos State Government under Governor Babatunde Fashola’s leadership,” he said. Earlier still, Lagos had brought Enron into the fold in 1999 – an unprecedented move at the time. “Governor Bola Tinubu caused Yinka Folawiyo Power and Enron to sign an agreement to supply 230MW, even when NEPA held an absolute monopoly,” he recalled.
Such audacity by Lagos, Nnaji noted, paralleled his own efforts at Geometric Power to build an emergency plant for Abuja and, later, the landmark ring-fenced Aba Power project. These historical echoes underscore the point that Nigeria’s power progress has often relied on institutional outliers and bold sub-national leadership. But the present moment, catalyzed by the 2023 Electricity Act, gives even more states the legal room to take charge of their electricity markets.
That’s where Lagos’ 4,000MW gas plant plan comes in – arguably the boldest energy initiative by any Nigerian state in the post-privatization era. The state’s call for bids to fill a 6,000MW supply gap is ambitious, and its move to allow existing DisCos (Ikeja Electric and Eko Electricity Distribution Plc) to establish subsidiaries for internal power distribution shows strategic foresight. Nnaji agrees, calling it “a positive development that ensures efficiency” and likening it to his own Aba DisCo model.
Yet, he struck a cautionary tone. “Many states are reversing privatization,” Nnaji warned. “Even with state regulatory commissions, they must contend with cost-reflective tariffs or provide subsidies… No state in the country can sustain electricity subsidies.” The implication was clear: states should stay away from subsidizing power or risk financial ruin. But this stance, while economically orthodox, may undervalue the developmental potential of smart, targeted state-led interventions.
Power, after all, is not just a commodity; it’s an economic catalyst. Across Africa, local and regional governments have deployed limited subsidies to stimulate investment, enhance productivity, and reduce energy poverty. In countries like South Africa and Kenya, sub-national governments have partnered with private firms and donors to roll out targeted electricity access programs, sometimes involving tariff cushions for low-income consumers. Why shouldn’t Nigerian states consider similar models, especially where market conditions are uneven and national interventions have fallen short?
Moreover, Lagos is not a typical Nigerian state. Its financial capacity, tax base, and infrastructure give it more room to maneuver than most others. A well-regulated subsidy model – perhaps time-bound or performance-based – could prove viable in Lagos. It could help accelerate adoption of embedded generation, protect small businesses, and even serve as a template for smarter state involvement. Rather than a slippery slope, selective subsidies might be a ladder to energy equity and long-term economic transformation.
Nnaji was correct to warn against repeating the federal government’s mistakes. But there’s a difference between ill-conceived bailouts and strategic investment. Where Abuja funded inefficiency, Lagos could fund innovation – especially if its energy commission enforces transparency, efficiency, and data-driven decision-making. The key is governance, not abdication.
On a broader level, Nnaji’s address raises critical questions about Nigeria’s gas supply gap. “There is limited gas for power plants and domestic manufacturing,” he said, calling the paradox of gas-rich Nigeria facing acute shortages “an awful paradox with grave consequences.” He urged Lagos and other states to work with the federal government in solving this foundational issue. Without stable gas supply, even the best-laid electricity plans may falter.
The keynote also highlighted a persistent crisis: over 80 million Nigerians still lack access to electricity. “This is unacceptable in the 21st century,” Nnaji said, contrasting Nigeria’s stagnation with Algeria’s universal access. It’s against this backdrop that state-led energy efforts, however imperfect, become not just justified but necessary. The national grid alone cannot meet Nigeria’s aspirations.
In the end, the Lagos Energy Summit revealed two truths. First, that Nigeria’s power challenge remains deeply systemic and multi-layered. Second, that its most promising solutions may now lie outside Abuja. As states like Lagos embrace their constitutional space to act, the rest of Nigeria – and the federal government – must watch, learn, and adapt.
As Professor Nnaji himself concluded: “Power enterprises must be run purely as commercial enterprises.”
That much is clear. But in a country still held hostage by darkness, the greater truth may be that power must also be run as a social contract—one that some states, including Lagos, now seem willing to redefine.
.Onyewuenyi, a Public Affairs analyst, writes from Umuahia, Abia State
