A critical review of Nigeria’s energy sector: sources, policies and electricity market

Energy is the backbone of every country’s economic development. Industrialization cannot occur without sufficient electricity or other modern energy sources. This study aims to review Nigeria’s energy resources and energy policies, and to examine the challenges of Nigeria’s electricity market. Thus, the paper contributes theoretically by integrating Nigeria’s energy resource potential, electricity market performance, and policy evolution into a unified analytical framework. A critical review approach was adopted for the analysis of this paper. The review draws on a wide range of reputable sources, including academic databases, government documents, industry reports, and the websites of international organizations. Among other things, the study uncovered that Nigeria has significant potential for solar energy considering its solar ration which amounts to at least 12.6 MJ/M2, in which only 385.7 MWP was utilized as of 2024. Fossil fuels remain the major source of electricity in the country, accounting for 75.7% of the national grid. The county’s electricity market suffers from a persistent deficit, driven by rising demand and issues in generation, transmission, and distribution.