Expert Urges Lagos to Unlock Idle Captive Power to Ease Energy Crisis

Peter Uzoho 

Energy expert and Managing Director of New Hampshire Capital Limited, Mr Odion Omonfoman, has called on the Lagos State government to urgently reform its electricity market rules to unlock thousands of megawatts of idle captive power sitting behind factory walls, hotel basements and gated estates, warning that every unused megawatt is a policy failure.

In an Oped shared with THISDAY, Omonfoman argued that Lagos is sitting on Africa’s most paradoxical energy stockpile, explaining that while the national grid struggles to deliver 5,000 megawatt (MW) of power for over 200 million Nigerians, decentralized private generators provide an estimated 15,000MW to 20,000MW nationwide.

A major Lagos State-backed study found only about 20 per cent of the state’s electricity demand is met by the grid. 

The same study estimated household genset capacity alone at 7.3GW–8.8GW, with 72 per cent of households owning at least one generator and 94 per cent of MSMEs owning one, mainly for backup.

“The real scandal is not the inadequate public supply. It is that we have allowed vast installed private captive generation capacity to remain trapped behind the fence line, unavailable to the wider market even when their owners do not need all of it,” Omonfoman said.

Describing the economics as  brutal, he explained most units were drastically underutilised. 

“A factory might install a 2MW gas generator to handle its peak load, but for 60 per cent of the day, it may only need 1MW. That excess 1MW — clean, synchronised, and ready — is currently wasted.  In a city where SMEs are dying for lack of affordable and reliable electricity, this underutilization is economically irrational,” he explained.

Noting the staggering cost, he argued that households with gensets were estimated to spend about N1.43 trillion a year on fuel, while commercial diesel and petrol users spend about N5.3 trillion annually.