Nigeria’s electricity sector is showing signs of renewed private sector confidence, with power companies’ borrowings from commercial banks rising sharply from N1.43 trillion in December 2023 to N1.77 trillion by December 2024.

This increase of over N347 billion reflects growing optimism amid ongoing government reforms aimed at revitalizing the energy industry.Data from the Central Bank of Nigeria’s quarterly bulletin reveals that power firms consistently accessed credit throughout the year, peaking at N1.89 trillion in February 2024 before fluctuating in response to repayment cycles and lending conditions.

“The steady appetite for credit by electricity firms could be traced to the government’s strategic push for reforms in the sector,” the report noted, highlighting initiatives such as deregulation, tariff adjustments, and support for renewable energy projects.

Minister of Power Adebayo Adelabu recently unveiled a new roadmap focusing on off-grid solutions, metering expansion, and distribution efficiency to tackle Nigeria’s electricity supply challenges.

The government’s Renewable Energy Plan, which promotes solar mini-grids in underserved rural areas, is a key part of this agenda.Despite high lending rates set by the Central Bank, power companies continue to invest heavily, especially in solar infrastructure, with Nigerians importing solar panels worth N200 billion in 2024 alone.

“The uptick in commercial borrowing reflects optimism in parts of the industry and may signal a shift toward entrenching a commercially viable power market,” the analysis concluded.

This borrowing trend underscores the sector’s resilience and the ongoing effort to attract private capital to boost electricity supply and infrastructure across Nigeria.