About additional Nigerian companies exited the national electricity grid between January and September 2025, opting instead to install captive power plants with a combined output of 1,045.54 megawatts (MW), data from Nigerian Electricity Regulatory Commission (NERC) said.
The trend is heightening anxiety over the fragility of Nigeria’s central power network and the escalating cost of doing business.
The shift is being driven by chronic grid instability, repeated system collapses, unreliable supply from distribution companies (DisCos) and rising tariffs that businesses say have not translated into improved service.
1,045MW now outside the formal grid
The NERC data further show that Pulkit Alloy and Steel Limited, NNPC Towers, Everest Pulp and Paper Limited, Sequoia International Development Ltd and Kwale Genco all secured approvals to generate captive power.
Others who also secured the appovals included: Obu Cement Company Limited (BUA) in Okpella, Edo State, CCK Electric Power Tech Company, Nigeria Pipes Limited, West African Container Terminal Nigeria Ltd, Nile University of Nigeria, , Yinson Operations & Productions West Africa Ltd and Azura Power West Africa Limited.
More firms abandoning grid
In August 2025, 46 entities were licensed to generate up to 289 megawatts of electricity.
In January 2025, about 250 manufacturers and academic institutions had abandoned their respective power distribution companies to generate their own electricity.
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The organisations, many of whom were bulk electricity users, exited the national grid to generate reliable electricity for themselves, according to the report.
They included: SweetCo Foods Limited with 1.50MW; African Steel Mills with 20MW; Armilo Plastics, 1.13MW; Royal Engineered Stones, 4MW; West African Ceramics Limited, 10MW; Ro-Marong Nigeria Ltd, 4.40MW, and Psaltry International Company Limited, 1.10MW.
MTN Nigeria Communication Limited got approvals for 15.94MW in total; University of Abuja got 3MW; University of Calabar & Teaching Hospital was secured 7MW; University of Agriculture Michael Okpara, Umudike, 3MW; University of Maiduguri & Teaching Hospital Main Campus, 12MW; Federal University of Agriculture, Abeokuta Main Campus, 3MW; Federal University Gashuwa, Sabon Gari, 1.50MW; and Nile University of Nigeria Jabi, 10MW.
Nigerian Breweries branches in Aba, Ibadan, Enugu, and others got approval for a total of 31.36MW; the Nigerian Defence Academy secured for 2.50MW, while Quantum Paper Limited got approval for 7MW.
Similarly, a total of 22 off-grid licences were issued to various firms, with a cumulative capacity of 151.214 megawatts. Golden Penny Power Limited secured licences to generate a total of 113.20MW with gas in different locations.
The NERC report showed that Daybreak Power Solutions was given nine solar grid licences for a total of 24.51MW. TIS Renewable Energy Limited obtained two licences for gas-powered plants, totalling 12MW, while Auro Nigeria Private Limited got a licence for a 1.5MW gas plant.
While gas plants accounted for 126.7MW of the off-grid plants, solar was 24.51MW. The licences were issued for off-grid generation projects across various states in Nigeria such as Lagos, Oyo, Ogun, Cross River, Kaduna, Niger, and Abia, The Punch reported.
The NERC had blamed the shift from the national grid on power fluctuations and low supply. In one of its statements, NERC said grid frequency was a crucial power quality parameter that industrial customers were particularly concerned about due to the sensitivity of their heavy-duty machinery.
It stated that in industrial production assembly lines, the machines were designed to operate only within pre-set frequency tolerance limits and therefore often had a low tolerance for frequency fluctuations.
“As specified in section 10.1.2 of the Grid Code, the standard frequency for operation on the Grid is 50Hz,” it said.
It noted that the code provided that under normal circumstances, the grid can operate within a deviation of ±0.5 percent, that is, between a lower limit of 49.75Hz and an upper limit of 50.25Hz.
“Section 10.1.2 of the Grid Code further provides that in extreme circumstances, the grid may operate within a deviation of ±2.5%, i.e., system frequency may reach a lower bound stress limit of 48.75Hz and an upper bound stress limit of 51.25Hz.”
Nigeria is hard hit by poor power supply, which disrupts factories and homes. Frequent grid collapses do not help matters as they plunge homes and firms in darkness, stalling economic activities and shinking growth.
