In 2001, a 70-kilometer (43 mi) long 330 kV powerline was built between Sakété, Benin Republic and Ikeja, Nigeria. It was a CEB–NEPA Power Interconnection that connected Nigeria’s power grid (NEPA) with Benin’s grid. This high-voltage power line symbolized Nigeria’s role as a key player in the West African Power Pool (WAPP), a collaborative body created under the Economic Community of West African States to create a unified electricity market across the region. With the CEB–NEPA Power power line, Nigeria would begin supplying electricity to Benin and Togo. The project officially opened on 13 February 2007. 

Similarly, Nigeria would begin supplying electricity to Niger in 2011. However, this time it wasn’t under ECOWAS’s vision. It was under the Nigerian Bulk Electricity Trading (NBET), the electricity pool in the Nigerian electricity supply industry. Nigeria entered into a bilateral with Niger Republic, that required Nigeria to provide electricity to the latter. Nigeria would later extend this agreement to the Benin Republic. In exchange, these countries would not build dams that would obstruct the flow of water to the country’s hydroelectric  Dams in Jebba, Kainji, Niger State, inherently creating a major crisis for the country. For years, these transactions have been. However, the initial optimism has dimmed in recent years.

Recently, the regulatory body for Nigeria’s power sector, NERC, issued an order mandating the System Operator to limit electricity supplied to international customers. The primary reason for the export cap appears to be a mounting debt crisis. These countries have accumulated a staggering N132.2 billion, approximately $368 million, in unpaid electricity bills since 2018. Last year alone, Nigeria’s main international electricity customers -Togo, Benin, and Niger- failed to remit $18.29 million for electricity consumed, as the total value of electricity exported stood at N23.5 billion ($ 50.9 million). Togo and Niger have been indebted to Nigeria for N132.2 billion in electricity bills supplied to them in 2018. This persistent non-payment has strained Nigeria’s finances and placed a burden on its already stressed national grid.

The order to limit power supply to international customers is likely to be significant for Nigeria. Nigeria currently faces challenges in providing sufficient electricity for its citizens. Typically, Nigeria generates most of its power through thermal and hydro, with an installed capacity of about 12,522 MW. However, local customers usually get less than 4000MW of electricity supply, In the last few weeks, electricity supply from the national grid hovered below 3,000 megawatts. It also signifies a shift of focus. Previously, exports might have been prioritized to fulfill international agreements. About 6% of the electricity generated in Nigeria is sold to neighboring countries. Last year, the government announced plans to sell about 2,000 MW of unutilized stranded electricity from Nigeria to Niger, Togo, Benin, and Burkina Faso through the proposed $570 million, 875 km, 330 kv Northcore Power Transmission Line project. Moreover, the dams stand as a significant advantage for these countries. For example, if Niger builds a dam that obstructs the 760-megawatt hydro-power station at Kanji Dam, it would significantly reduce the electricity supply for Nigeria.

However, the impact on Benin, Togo, and Niger will be equally significant. According to the International Trade Administration, Benin gets 72% of its electricity supply mix from Nigeria. Togo gets about 47%, and Niger, 87%. A cut-off cut leaves these countries with a substantial energy shortfall. This leaves them scrambling for alternative sources of electricity. They could explore options like ramping up domestic generation capacity, investing in renewable energy sources, or seeking new suppliers within the WAPP framework. Also, the export cap serves as a stark reminder of the challenges associated with regional energy integration. WAPP’s vision is to create a unified regional electricity market. And from 2019 to 2023, the overall increase in electricity access across the region rose from 45% to an average of 53%. While the move addresses Nigeria’s immediate needs, it disrupts the established flow of electricity within WAPP.

However, the NERC’s decision to cut the electricity supply is not a slamming shut of the door. The cap is an interim measure, meant to last for six months. Several possibilities exist. Firstly, it creates space for potential negotiations between countries. Perhaps new payment structures or debt settlement plans can be established to ensure a more sustainable arrangement. WAPP may need to play a crucial role in facilitating investment in regional generation projects, creating a more balanced and resilient electricity market. Also, the halt allows Nigeria to properly assess its domestic supply situation. According to data from the grid service, electricity supply from the national grid has risen above 4,700 megawatts since the cap was announced. However, Nigeria’s electricity domestic distribution deficit is beyond exporting 6% of its electricity. The coming months will be crucial for Nigeria and its neighbors. Will they be able to find a sustainable solution that ensures both domestic energy security for Nigeria and continued regional cooperation?