Nigeria's two major aviation service providers spend more than N34 billion annually on grid electricity, according to a review by the Ministry of Aviation. The Federal Airports Authority of Nigeria (FAAN) and the Nigeria Airspace Management Agency (NAMA) are among the country's largest power consumers, with additional costs incurred through diesel generators and other energy sources. Two years ago, the ministry reported that Murtala Muhammed International Airport alone consumed N1 billion worth of electricity monthly, while electricity bills at Nnamdi Azikiwe International Airport in Abuja exceeded N1 billion annually.
FAAN has allocated N8.73 billion to modernize airport power infrastructure and reduce reliance on diesel fuel, as part of efforts to transition major international airports to solar energy. The agency has incurred substantial costs running high-capacity diesel generators overnight during non-peak hours when no flights are scheduled. NAMA, which spends over N10 billion annually on power, has been investing hundreds of millions of naira to transition air traffic control and navigational aid stations in Lagos, Abuja, Kano and Port Harcourt to solar power systems. The shift is critical because NAMA's installations provide safety-critical services that cannot be interrupted.
The power crisis extends far beyond aviation. At a business forum titled 'Energy Costs and Business Survival' organized by the Lagos Country Club, energy executives highlighted the broader economic impact. Manufacturers spent approximately N1.35 trillion on alternative power in 2025, a 23 percent increase from the previous year, with energy costs accounting for around 35 percent of production expenses. The World Bank estimates Nigerian businesses lose about $29 billion annually to unreliable electricity, while approximately 87 million Nigerians have no access to electricity.
Small businesses report spending over 40 percent of their profit on alternative energy, while hotels, hospitals and other service providers depend on generators to maintain operations. Ifeoma Ukabiala, a senior energy executive, noted that the national grid collapsed twice in January 2026, on the 23rd and 27th, and once in December. On a typical day, the grid carries four to five thousand megawatts against installed capacity exceeding twelve thousand megawatts. Former Power Minister Barth Nnaji argued that Nigeria requires cost-reflective electricity tariffs to attract investor capital to the sector, as the current subsidy model is unsustainable.
For savers and businesses, lower electricity costs could reduce production expenses, potentially lower prices for goods and services, and improve profitability and competitiveness in the economy.