In 2022, my neighbors and I in the Ikate area of Lekki, Lagos, Nigeria, experienced a 24/7 power supply for the first time. This level of power supply is typically only available in select, upscale neighborhoods in Nigeria’s major cities like Lagos and Abuja.
We sought to improve our quality of life by securing a steady power supply for our homes. In 2021, we were approached by an independent power operator who offered to take over our internal power supply, including the grid supply from Eko Disco and any individual alternative power sources we had.
After some negotiations, we signed a contract with the company that gave them control of our entire power supply. Under the agreement, we paid for meters and purchased 2,500 kWh of power, with a tariff that was initially N95/KWh.
The tariff was determined by a blend of 60% grid supply and 40% from a generator, meaning we expected Eko Disco to provide light at least 60% of the time. The more availability from Eko Disco, the lower the tariff, and vice versa. Additionally, capital expenditure also played a role in determining the tariff, although it was less volatile. The higher the generator capacity, the higher the pass-through cost of the tariff.
To get the tariff as low as possible, we had to convince other mini-estates in the neighborhood to join the deal. This was not easy as they had to sell their existing generators, as did we. The contract also required a tariff review every quarter, based on local grid supply availability and diesel cost dynamics.
We began the new power arrangement in late 2021. Initially, some of us averaged 1,600KWh per month in consumption, which came out to around N163,000 per month, compared to the previous average of N50,000 per month. However, by the next month, we all started reducing consumption, some by investing in inverters despite the operator’s objections.
As we continued to monitor and reduce our power usage, it became a competition among us to see who could get their usage down the lowest. However, by April 2022, diesel prices had risen and power from Eko Disco had dropped to around 40%, leading to an increase in our tariff to N150 per unit. This was not the last increase in tariff as we received several more notifications for hikes throughout the year.
Despite the challenges, we could enjoy a better quality of life with a 24/7 power supply, but it came with a cost, both financially and in terms of changes to our daily habits and lifestyle.
By the next month, we all began reducing our power consumption. Some of us implemented measures such as using power-efficient appliances, turning off air conditioners during the day, and investing in inverters, despite the operator’s objections. My challenge was figuring out how to reduce my consumption below the 1,000 KWh threshold.
I purchased a 5kV inverter and moved all my equipment except for my air conditioners, water heaters, iron, and cookers. The initial cost at the time was just over N3 million and it required that I pay the supplier in installments. It seemed like an additional cost I did not need but I reckoned I could recover same from the savings from alternative power.
After two months, my power demand dropped to 1,200 KWh, which was still high. My children couldn’t understand why I was making such a fuss. “Why pay for something you can’t enjoy, Dad?” Some of my neighbors were able to reduce their consumption to below 1,000 units.
To achieve this, it seemed that one had to use less air conditioning, as they are a luxury when tariffs are high. In my house, we stopped turning on the ACs until midnight. I even moved one of the inverter ACs to the inverters. At some point, it became a competition among us to see who could reduce their power usage the most. I often lost and started suspecting foul play, despite being metered. As cynical as this now sounds in hindsight, it was a purely rational reaction to a financially draining venture. Money makes you paranoid if it’s draining
Another major factor in power usage is the number of people in your household. More children, visitors, and relatives living with you mean more power consumption. Additionally, the bigger the house, the higher the cost. Electricity usage has a way of instilling financial discipline and vigilance. It also brings accountability for all parties.
By April 2022, diesel prices had risen from N180 to N250 per liter, and power from Eko Disco had dropped to around 40%, which was much lower than the 60% that the tariff was based on. We received our first notification for a tariff increase, which was raised to N150 per unit. This was not the last increase, as we received several more notifications for hikes throughout the year.
As a result, we had to adjust our consumption and, as expected, it dropped for many of us. This meant that the generator could be on for hours, but no one would use it because we were too scared to turn on our ACs during the day. I suddenly found a new appreciation for fans and solar inverters.
Solar inverters are an interesting piece of equipment. They work well during the day, but the power that powers them drops at night. To keep them going, you use power from the grid to charge them. Your tariff could increase depending on how long you charge them. For example, if you charge a 5kV inverter for six hours, it consumes approximately 24kWh. Doing that for 30 days would consume 720kWh.
Despite, my initial assumption that solar power will save me money, it was now increasing my consumption cost especially if I continued to charge it with my grid/generator power Now, we understood why the operator warned us against using them. Once some of us figured out that this was what was contributing to heavy consumption, we reduced or stopped charging them entirely and switched to using the grid directly at night. Despite these efforts, things were still about to get worse for us.
A few weeks later, the operator informed us that they had to change the tariff again, effectively breaching the three-month clause in the contract. We realized that in deals, contracts are just there to guide everyone, and when push comes to shove, common sense has to prevail. It’s when common sense fails that everyone goes to court.
The operator cited volatile diesel prices and product scarcity as reasons for the increase, and the tariff went up to around N250/KWh. We also learned that other derivatives in Lekki with similar arrangements had observed tariff increases. The Discos also increased their tariffs, exacerbating the issue.
By now, everyone’s nerves were on edge. We decided to investigate the components of the tariffs and how they were determined. This was something we had never done before. The costs were causing us to be more financially disciplined and vigilant. It also brought accountability for all parties involved.
We examined the year-long buildup and noticed that many items were structured to make us bear the consequences of the operator’s inefficiencies.
For example, if they refused to hedge diesel prices, we would have to pay the price. We also noticed a term called the consumption ratio, where the less power we consumed, the more we paid.
To explain, assuming a 100 KVA generator is only loaded at 25% capacity because everyone is reducing consumption. The rough calculation often suggests the generator will still burn as much diesel as it were when it’s loaded at 80%.
It was a huge penalty for being power-efficient, and we did not agree with it. In response, they told us we had to bring more mini-estates to the plan. We retorted that it was not our responsibility.
In any case, while this was happening, tariffs went up to an exorbitant N350/KWh. Diesel prices were also around N800 per liter, so they told us tariffs had to go up. Power from the grid was also very poor, dropping to around 4 hours a day.
By this time, it was a breaking point. We were essentially spending all our earnings on power. You see, comfort has a price and a limit. Some of us were ready to terminate the arrangement. Others, it will seem, at other nefarious responses to the rising cost.
As the tariff became unbearable, the supplier brought our attention to suspected energy theft. They claimed one of the residents had bypassed their meter and went ahead to slam them with a N1 million penalty. The accused resident immediately denied the claims, forcing a counter-accusation.
We conducted our own investigation and determined the meter had indeed been bypassed. However, there was no proof that the resident had done it. They finally agreed on a back billing spread over several months to claw back the losses.
Most DisCos face similar losses stemming from energy theft. Losses cost DisCos around N29 billion based on a monthly average billing efficiency of 77% (they billed N295 billion). This is based on 2021 Q1 data. DisCos racked up total losses of 47.8%, out of which 23.4% is commercial. So, the higher the tariff, the higher the risk for energy theft despite mass metering. I envisage Nigeria will have to develop its own meter specifications capable of discouraging energy theft.
The current meters we have now can’t stop energy theft as they are mainly built to allow for vending and token issuances. Our operator only suspected the energy theft when they noticed a pattern of low vending compared to other neighbours. This can be onerous if you are dealing with thousands of customers.
Following the resolution of the energy theft, some of us suggested we get the operators to either reduce the number of hours or get us a smaller generator as power consumption was now well below the 100KVA we started with. But other property owners who operated Air BnBs were more cautious. They needed the power, and since they made their money from short-stay customers, their business model could cover the cost.
After much consultation, we decided we all needed 24/7 power but asked the operator to reduce the size of the generator and be more efficient with their operations.
In addition to adopting a more cost-efficient approach, some of us played smart by locking in costs months ahead. This meant buying three months’ worth of power units at current prices. While this saved money in a volatile environment, it meant paying out N600,000 at a time. Not easy at all!
Negotiations escalated, and we all demanded collective accountability. We even considered scaling down the size of the generator. Some suggested that we give up 24/7 power as it was no longer affordable based on the current model.
Amidst all this, the sector regulator, NERC, launched the partial activation that forced everyone in the sector to comply with power generation and distribution. Grid power increased sharply in August, and September, and tariffs dropped to around N200/KWh.
It was a huge relief for most of us. Imagine paying N400,000 a month for 24/7 power. There is no amount of comfort that is worth it, in my opinion. You still had to contend with rising costs of food, school fees, etc.
It has been like that since then, except for a small increase in early December. A recent hike in tariffs by DisCos might affect us again but we are yet to get a notification.
The experience of having 24/7 power supply has been both positive and negative, but it has made it clear that it is not inexpensive, particularly when using a modular approach.
However, it is likely the most efficient way to improve the power supply in the country.
While renewable energy sources like solar power are environmentally friendly, they can be costly. Grid power is still the most reliable, efficient, and clean source of energy, but the current market design does not provide enough incentives for it to be effective.
Furthermore, it is not dependable for powering industries. It would require billions of naira to improve the reliability of grid power, but this is unlikely to happen under the current market design.
Another realization is that Nigeria needs more heavy industrial users to decrease the cost of power generation. A service-based economy like ours is not well-suited for cheap power.
As the power sector continues to struggle, independent power producers are exploring more cost-effective options. With increasing scale, they can improve. All that is required is for them to form a partnership with distribution companies (DISCOs) to utilize their distribution lines and infrastructure.
I hope that my experience can assist others who are considering going off the grid or utilizing a similar service to learn from my experiences.
An eye opener indeed.
I have a solution with a mix of inverter and using another approach to power your ACs for more than 10hrs a day and you will not spend more than 100k per month for having 24hrs light.
Kindly reach me via my email:
babatunde.adebiyi@bmanda.com.ng
The writer is mixing something up here. Installing an inverter is not the same as installing a solar system. What they did was install inverters whose batteries need to be charged. The grid provides the charging source.
To truly save money, you need to install a solar system. The solar system replaces the grid in charging your inverter batteries.
That is when you are going to have a cost saving.
A solar system is made up of a group of solar panels, solar charge controller, solar combiners, breakers, cables and your battery bank. Sometimes you don’t need a battery bank depending on the design and need. And sometimes, you don’t need a separate solar charge controller if you are using a hybrid inverter.
So, sir, you are not having cost savings because your assumptions are wrong and the design is inadequate.
God bless you. My thoughts exactly. I use a hybrid 1kva solar inverter and I have 2 solar panels that charges it, I get light 10hrs a day at least I sleep with light, day time my inverter powers all my appliances except Ac and fridge which I dont need to bcos my fring is frozen and my rechargeable fans work perfectly fine on inverters to provide cool air. I dont even use up to 20k a month
You have to
Very helpful article.
First hand experience narrative
They’re scamming you guys. People in ikorodu, pay about 4k a month using prepaid meters. I think the tarrifs and other cost measure are considered with the location in lagos.
Nice read
Can the writer please contact blueriverseal@gmail.com. Thanks.
This is a ‘mouthful’ energy experience.
Those who are considering other source of energy would find this very handy.
Interesting write up. However on the solar inverter issue, I suspect you are using your inverter concurrently with your grid power. On my home setup, I deployed Wi-Fi breakers that are timed to switch off the grid during the day and reconnect for 6hours starting from 4pm to 10pm. That way I get sufficient top up charge to take my inverter throughout the night to the next morning and fresh sunlight. Of course, on rainy days, you simply have to rely on grid power since the sky is overcast or even grey. The trick is to have a large enough inverter system to take all appliances, and down size your AC to 1hp where possible typically bedrooms. Of course, I now only use LED bulbs and most of my switches and sockets are smart, allowing me to program my use of electricity. For instance, all my bedroom ACs are connected through a Wi-Fi breaker that comes on during the day and goes off by 6pm. It is not perfect yet, but the technology is improving by the day. Furthermore, With the advent of Lithium batteries, your batteries should last 8 to 10 years. Challenge is solar systems are very expensive and needs large capital outlay. Eventually the real gain apart from reliable power is hedge against tariff inflation, and savings on monthly tariffs. Unfortunately in this country, we are not able to sell excess electricity from our solar systems back to the utility companies even as power credits. But we soldier on…
Good analysis. You seem to have experience. I hope you can assist people like us. I need a robust power plan for my little enclave!
Hello Frank, can I get your contact, I need to get more info about this your model
Mr. Frank, your solar power with WiFi switches seems interesting, I would like explore your solar option with the WiFi switches.
I would also like to know the estimated cost to power a two bedroom apartment with proper management for a 247 uninterrupted power supply using solar and the power grid.
Thank you.
The cost to power a Two bedroom apartment with proper Management for a 24/7 Uninterrupted power Supply.
Firstly, the size of your apartment is inconsequential. You may be staying in a two bedroom apartment and consume more energy than someone staying in five bedroom apartment.
The capacity of your electrical and electronic gadgets is what matter.
Now let’s begin by estimating what it will cost you to power a 2 bedroom apartment.
First of all, calculate the capacity of your gadget. Then design a solar system that cater for twice your energy need. This will ensure you have sufficient energy backup during cloudy weather.
ENERGY CAPACITY
Assuming you power 12bulbs of 10W each for an average of 14 hours daily, that’s 12 X 10 X14 = 1680W
So, you need a Solar system that will give you at least 1680W backup power after considering the DOD (Depth of Discharge) of your battery.
All you need to have access to a readily available energy supply throughout the day will be a 1KVA solar inverter system with at least 1.6KWh battery backup.
You may multiply the battery backup by 2 so that you have energy backup for at least 48 hours during cloudy day.
That means you need a backup of 1680*2 = 3360W. 3.6KW
Two 200A 12V lead-acid batteries will be sufficient to meet your energy demand with a backup of 48hours.
Or One 200A 12V with only 24hours energy backup.
(To really enjoy your battery for say 8-10 years, it’s good to make an investment on Lithium batteries. Lithium batteries has high Depth of Discharge as compared to Tubular or AGM batteries.)
If you are adding fans, TV, Blender, AC, laptops, mobile phones, iron etc, you’ll need to identify the capacity of this gadgets and specify the number of hours you intend to power each gadget daily.
You also have to specify the gadgets you’ll be using simultaneously. This will inform the capacity of the inverter to get, the Solar PV array and battery backup.
Summarily, you need the right Solar PV system and good energy management to power your two bedroom apartment.
My home runs on 24/7 Solar backup supply along with approximately 20-45% On-grid power supply.
You can send me a DM via my Twitter handle @midehayobami for more information.
Well detailed experience. I knew 24/7 electricity is an expensive objective in a Nigerian home. Thank you for sharing
thank you for the information
I use a hybrid 1kva solar inverter and I have 2 solar panels that charges it, I get light 10hrs a day at least I sleep with light, day time my inverter powers all my appliances except Ac and fridge which I dont need to bcos my fring is frozen and my rechargeable fans work perfectly fine on inverters to provide cool air. I dont even use up to 20k a month
I mainly provide my own power. During the day I use solar power only and turn off grid power. When there’s no more sunlight, I then use grid power, or, if unavailable, use whatever is left of the solar power. I pay far less than 20k a month for power.
I only invested less than 500k for the solar inverter system I have.
I have no need for petrol or diesel, maintenance of the solar inverter is less than 30k a year, if at all any is needed. Whenever there’s scarcity of petrol or diesel I’m not bothered at all. My house is Goshen. Haha. I’ll admit though, sometimes the grid fails and then there’s no sunlight but I’m still guaranteed light during the day for the smallest glimpse of daylight and at night the inverter stays on till at least 2am on such days. Yes, I live with 3 others so it’s not like I’m alone. When it comes to electricity generation, a central arrangement is never the answer, that’s why the grid keeps disappointing people. Power your own house yourself and take responsibility for downtime.
Very insightful article and some sound comments.
I recently relocated back from UK and was determined to avoid generator noise pollution.
I moved to a brand new 3 bedroom flat in Magodo with plenty of cross ventilation as I am no fan of ACs even though am UK born.
We have prepaid meters installed and my consumption is average of N6k per month.
Prices you are paying for unreliable power is ridiculous!
Good read. So much to learn from the piece and comments. Pump of ideas. Enlightening. Thanks all!
If I’m rich or when I’m rich enough I will solve the power crisis of this country.
The power crisis in this country needs all hands on deck for it to be solved.
1. The rural urban migration needs to be checked. People are moving enmasse and it is the urban areas that are bearing the brunt
2. Nigerians need to know the maths behind the tariff calculation. If an individual has that knowledge he or she would know what and what appliance(s) to use or own.
3. Energy saving appliances is the best. From Bulbs to refrigerator etc.
4. The modular approach would go a long way. I stay around the trade fair area of lagos and trust me, the power situation now is at its worst. I spend 21k on fuel alone and then 10k on light bill…. Thats 31k every month. Thats over 360k a year.
5. EKEDC should communicate more with its customers via ads, mails or text. This guys suck at Public relations.
I hope this power crisis doesnt swell into a catastrophe.
Solar Energy is the way forward…yes, it’s costly, but efficient, renewable, green, clean and cost effective in the long run.
The thought of having 24 hours power supply can be achieved if and only if people are conscious of their daily consumption.
If you don’t need the light, turn it off.
If you are not using the fan or electronics, turn them off.
A plugged in electronics even if not in use also consume power but people don’t know this fact.
I personally own a hybrid solar system comprising of a 2kva inverter,
2 ( 260watt solar panels)
2( 200 amps gel batteries)
60 amps charge controller.
Since it was installed over a year ago I have only turned on my gen 4 times and that was when I had an occasion which will require me using heavy power.
I can power my lightings, phones,DC fans, 43 inches smart tv, home theatre, blender, and fancy lights too in my house.
The trick I use is not using too many heavy devices at the same time.
And with that there is always power whenever I’m at home till the next day that the system starts charging again through solar.
FYI: I connected my freezer to the grid so it doesn’t run through my inverter system so as to optimise power usage.
With this I spend only ₦2000 buying prepaid units monthly sometimes less.
You too can try it and it’s worth the money