Report: Energy Deficit Costs Residents, Businesses N5.3trn Annually

Energy shortfall in Lagos adds an extra N5.3 trillion annually to the costs of residents and their businesses.

This is according to the Lagos Economic Development Update (LEDU) 2025, published by the Lagos State Government.

The report stated that while the state requires approximately 9,000 megawatts (MW) of electricity, it received a meagre 1,000 MW from the national grid, which is just 11 per cent of demand.

It said the development had made more than 80 per cent of Lagos’ population and businesses rely on off-grid power solutions, predominantly petrol, diesel, or fuel oil generators.

According to the report, this dependence contributes to high energy costs, inefficiencies, and severe environmental pollution.

It said off-grid generators in Lagos produced around 15,000 MW daily but at a significantly higher price. The report said: “Power generated from these sources costs approximately N130 per kilowatthour (kWh) compared to N50/ kWh from the national grid.

This cost disparity translates to an additional financial burden of N5.3 trillion per year on Lagosians, further reducing disposable incomes, limiting business investments, and slowing overall economic productivity.

“Off-grid generators in Lagos produce about 15,000 MW daily but at exorbitant costs, with power generated at N130 per kilowatt-hour (kWh) compared to the national grid’s N50/kWh.

This disparity imposes an additional financial burden of approximately N5.3 trillion annually on residents and businesses, reducing disposable incomes, limiting investments, and weakening economic productivity.”