The President of the Nigeria Labour Congress (NLC) and General Secretary of the National Union of Electricity Employees (NUEE), Joe Ajaero, has described the power sector as “the biggest scam in the country,” alleging that it has become a preserve of powerful interests.
In an interview with Vanguard, Ajaero questioned the very intent of privatizing the power sector .
“Was privatization meant to improve electricity supply? It is important that we realize this. Privatization was never meant to improve power supply.”
He recalled that prior to privatization, licences were granted to private individuals who failed to develop capacity. He stressed that the total capacity of NEPA (later PHCN) stood at roughly 4,000 megawatts, a figure that remains shockingly unchanged today.
“At the time, I led the union and we warned them that if they privatized and split the system into 20 companies, it would still be the same 4,000 megawatts they were sharing. And that is exactly what happened. Eko, Ikeja, Ibadan, Enugu DisCo, and others are all still depending on the same 4,000 megawatts. The unbundling and privatization were not meant to increase capacity.”
Ajaero characterized the process as a structural division rather than an infrastructural expansion, designed primarily to create administrative roles rather than boost generation, transmission, or distribution capacities.
“They claimed they wanted to privatize NEPA because it was obsolete. Yet they were all fighting to buy the same supposedly obsolete equipment. They also claimed NEPA was inefficient, but it was that same NEPA that was divided into 20 entities and sold. How did they expect that to improve power supply?”
Ajaero criticized government policy and private sector execution, highlighting a severe misallocation of resources in plant placement. He argued that instead of building “political power plants” in locations like Papalanto and Omotosho, which require expensive, vulnerable gas pipelines constructed from the Niger Delta, stations should be built directly at the gas sources.
Ajaero advocated for a diversified energy mix utilizing Nigeria’s vast natural resources, pointing to international examples:
“When people discuss climate change, some countries talk about reducing non-environmentally friendly sources. But you must first have enough electricity before transitioning. Countries like Germany still use coal significantly. In fact, Germany depends on not less than 40 per cent coal for its electricity supply. In Nigeria, we have no coal-fired power plants despite our large coal deposits.”
He suggested that combining coal-fired plants with major hydroelectric projects like Mambilla and Zungeru could easily generate a stable baseline of 5,000 megawatts, leaving gas stations to serve as supplementary or emergency infrastructure. To resolve the friction between gas supply and power generation, Ajaero proposed structural consolidation:
“I advocated for a Ministry of Energy, where the minister in charge of gas would also oversee transmission and generation. In that case, gas supply and pricing issues would be better coordinated.”
Ajaero strongly condemned the current tariff structure, which divides consumers into different bands (Band A, B, and C) based on documented hours of supply, arguing that it compromises the fundamental principle of public utility:
“Nigerians are too docile. Why should somebody classify me as Band A and classify another person differently? Is it not my right to have electricity for 24 hours? As long as this banding system exists, many parts of the country will continue to suffer poor supply.”
He warned that this system commercializes a vital necessity at the expense of rural communities:
“The authorities focus on areas designated as Band A because they can pay more. To that extent, electricity is no longer treated as a social service. People in villages and rural communities are effectively abandoned because they cannot afford the high tariffs. Band A, Band B, and Band C are unfair, and people should not accept the arrangement.”
A core failure of the privatization exercise, according to Ajaero, was the lack of technical competence and financial muscle among the initial buyers. Rather than attracting Foreign Direct Investment (FDI), local buyers leveraged local bank loans to acquire national assets, leading to severe liquidity crises.
“The original buyers of these power assets had little or no capital of their own. They borrowed heavily from Nigerian banks, and this contributed to the liquidity challenges the banks later faced because of the power sector. No foreign capital came into the country to purchase these DisCos. The acquisitions were financed largely with local bank loans.”
“As we speak, almost eight or nine DisCos have been taken over by banks. Many of these companies are facing serious challenges because of this arrangement. That is the problem we have today. We failed to ensure that only investors with genuine technical expertise and real financial capacity took over these DisCos. Now, the banks are effectively running them. But banks are not electrical engineering companies.”