How Electricity Policy Determines Universities' Capacity to Support Student Entrepreneurship

Since 2016, federal electricity policy has created a different environment for student entrepreneurship across Nigerian universities. Student entrepreneurship, often dismissed as marginal side hustles, collectively constitutes a significant economic force within the Micro, Small, and Medium-sized enterprises (SMEs), which account for 48% of Nigeria's GDP, and many of the existing businesses originate on university campuses. 

With youth unemployment at 6.5% and overall unemployment at 4.3% as of 2024, Nigerian graduates face a labour market that cannot absorb them. Approximately 42% of graduates start businesses not out of an ambition for innovation but out of employment scarcity. 

The Federal Government attempted to address this challenge through its Energising Education Programme, but variations in implementation have produced uneven outcomes across universities. Combined with Nigeria’s broader electricity crisis, this has exposed significant gaps in institutional capacity, where some universities are able to support diverse and scalable student enterprises, while others limit entrepreneurship to basic survival-driven activities. 

Access to sustainable and reliable energy could mark the difference between student businesses that merely sustain livelihoods and those capable of scaling, creating jobs, and contributing meaningfully to economic growth. 

Student Entrepreneurship Success Stories

A reliable university electricity infrastructure directly enables student ventures to scale into major economic drivers. Here are some success stories that illustrate what becomes possible when foundational support, such as electricity, is in place for student entrepreneurs. 

Jobberman, founded by OAU students Ayodeji Adewunmi, Opeyemi Awoyemi, and Olalekan Olude in August 2009, grew to over 10 employees and generated tens of millions in revenue before Ringier’s acquisition.  ToLet (now PropertyPro.ng), launched by OAU students Seyi Ayeni, Sulaimon Balogun, Fikayo Ogundipe, and Dapo Eludire in 2012, became a major real estate platform valued at over $1 million.

Covenant University students, including Somtochukwu Ifezue and Odunayo Eweniyi, founded PushCV in 2014, which led to PiggyVest serving millions of users. Printivo, which emerged from LAUTECH student Oluyemi Ojo's campus printing operations in 2013, employed about 20 staff, generated millions annually, and became Nigeria's leading online printing platform. These ventures demonstrate that when universities provide reliable infrastructure, student businesses can evolve from campus operations into companies that contribute to GDP, generate millions in revenue, and create substantial employment.

Globally, universities with robust infrastructure support demonstrate substantial economic impact: MIT graduates have founded more than 30,000 active companies, generating $1.9 trillion in annual revenue, while Stanford's ecosystem accounts for 5.4 million jobs.  While a direct comparison is not possible, the relationship between infrastructure and startup output is observable globally.

The Broader Context: National Electricity Scarcity And Student Entrepreneurship Patterns

Nigeria's epileptic electricity sector generates approximately 5,639 megawatts, representing 41% of installed capacity, with distribution losses and infrastructure failures resulting in chronic shortages. National electricity access stands at 61.2% compared to the global average of 91.6% and near-universal access in high-income countries. 

For many, the crisis intensified when the electricity tariff restructuring moved many moderately developed areas to the top billing category despite unreliable supply. Universities now pay premium rates without receiving corresponding service hours, inflating institutional costs without improving student business environments.

This affects Nigeria's research and development investment, which is 0.2% of GDP, compared with an average of 1.7% across other African countries. This gap reflects how electricity scarcity not only hampers existing businesses but also discourages the emergence of innovative ventures.  The causal relationship is rooted in access to electricity: without reliable power, universities cannot maintain functional laboratories, researchers are unable to carry out consistent experiments, and the research ecosystem necessary to attract investment and drive innovation struggles to develop. 

The Energising Education Programme (EEP) 

In 2016, the former Buhari Administration approved the Energising Education Programme (EEP), which aimed to provide reliable, affordable, and sustainable electricity—primarily through solar hybrid power plants—to 37 federal universities and 7 university teaching hospitals nationwide. While the EEP was not explicitly designed to support student entrepreneurship, its infrastructure delivery has entrepreneurial spillover effects. 

Official documentation across Phases I, II, and III emphasises energy access, research enablement, and renewable energy skills development rather than business incubation or startup support. However, by providing 24-hour reliable electricity, the programme will enable students to operate campus businesses—printing services, tech hubs, catering—without prohibitive generator costs. Additionally, each beneficiary institution will receive a Workshop and Training Centre where students can gain practical experience in renewable energy technologies, equipping them with technical skills for potential ventures in the green energy sector. 

 While the government covered Phase 1 (seven universities and two teaching hospitals), future phases were planned with international support: Phase 2 (seven universities and 2 teaching hospitals) would be backed by World Bank funds through the Nigeria Electrification Project, and Phase 3 (eight universities and one teaching hospital) would be supported by the African Development Bank. This distinction in funding mechanisms, domestic Phase 1 versus externally-backed Phases 2 and 3, is critical to understanding the divergent outcomes explored in the case studies below. As of June 2025, the project has reached approximately 80% completion. 

Universities were selected using a methodology that prioritised equitable distribution across Nigeria's six geopolitical zones, sufficient land availability for solar hybrid installations, and large student populations to maximise impact. 

Phases were designed sequentially to allow progressive rollout: Phase I focused on initial proof-of-concept in 5 zones with core solar-hybrid deployments; the latter phases expanded coverage through competitive bidding for developers, an emphasis on sustainability plans for longer-term operations, and established REA guidelines prioritising environmental safeguards, with post-implementation oversight to ensure self-sufficiency.

Case Studies on the stages of Implementation at Three Different Universities

Case Study 1 - Obafemi Awolowo University  

Obafemi Awolowo University (OAU) was meant to receive an 8.4-megawatt gas-powered plant intended to stabilise campus electricity. As of January 2024, university officials confirmed to The Guardian Nigeria that construction materials had been delivered to the site but were deteriorating due to the contractor's abandonment of the project. Six years after OAU was named a beneficiary, the plant remains incomplete.

The institutional consequences are measurable. After the Nigerian Electricity Regulatory Commission's 2023-2025 tariff restructuring, OAU's monthly electricity bills increased from approximately ₦80 million to over ₦200 million. OAU is classed under Band A, and this classification requires utilities to provide at least 20 hours of daily supply, but power supply remains intermittent. 

For student businesses requiring consistent power, this creates a structural barrier. During periods of high demand—exam weeks, project submission deadlines, convocation ceremonies—a student printer’s revenue is ₦500,000 to ₦1,000,000 weekly. During low-demand periods compounded by power outages, weekly revenue drops to ₦100,000. This does not absolve them of costs ranging from electricity to staff wages and equipment maintenance. Furthermore, when power cuts occur during peak demand, customers migrate to private printing shops outside campus. 

Case Study 2: The University of Ibadan

Similarly, the University of Ibadan (UI) welcomed the Minister of State for Education, Prof. Anthony Anwuka, who inaugurated a 10-megawatt solar plant under the Nigerian-German Energy Partnership Project with assistance from the Tertiary Education Trust Fund. The $15 million (₦5.4 billion) project was a pilot with a six-month delivery timeline. University leaders justified the solar plant on the grounds that UI consumed diesel valued at ₦400 million annually.

As of 2025, the site is now a football field and a waste dump. The solar panels displayed during the inauguration are gone, with only the brick foundation remaining as evidence of the project.

The institutional impact is evident when comparing patterns of entrepreneurship across universities. At UI, despite 98% of students expressing favourable attitudes toward entrepreneurship, only 32% are actively involved in business activities: a 66-percentage-point gap between entrepreneurial intent and actual activity, suggesting that aspiration alone is insufficient without reliable infrastructure to act on it. Students cite electricity scarcity as a constraint, and a July 2024 internal memo from the Director of Works confirmed that daily electricity supply had been rationed to 10 hours. The data suggest that power availability determines whether entrepreneurial interest translates into viable business ventures.

Case Study 3: The University of Abuja

The University of Abuja was selected as a flagship beneficiary of EEP Phase 2. In late 2024, an EM-ONE-built solar-hybrid plant with higher generating capacity became operational and began supplying power to more than 14,000 students. The plant provides approximately 24-hour daily electricity through a combination of solar generation and grid backup. 

The institutional impact on student entrepreneurship is quantifiable. The university commissioned 110 commercial units requiring businesses to reserve 20% of positions for students, directly creating employment opportunities. This supports a university policy aimed at ensuring that all graduates incorporate businesses. Students requiring consistent electricity previously paid ₦5,000 daily for workspace at powered hubs, as is the case at UI and OAU. After the solar plant stabilised in late 2024, the elimination of generator dependence and 24-hour campus power removed this ₦5,000 daily barrier, enabling students to operate power-dependent businesses—printing services, tech support, digital services—directly from campus facilities with predictable energy costs. The reliable power infrastructure fundamentally shifted student business viability from survival-level activities constrained by power scarcity to scalable ventures with extended operating hours and reduced overhead costs.

Unlike the University of Abuja, OAU and UI have sought workarounds but still face limitations. UI installed localised solar systems, received a hybrid solar donation from itel in 2025, and achieved 97% adoption of LED bulbs in residential complexes. Despite these efforts, UI remains constrained by its inability to complete the 2016 pilot project and continues augmenting grid supply with a power station during peak hours.

Likewise, OAU obtained a license to generate electricity independently and now purchases power directly from First Independent Power Limited as an "Eligible Customer," bypassing distribution company constraints. However, this still leaves student businesses bearing high energy costs during supply gaps.

Causes  Of Uneven Implementation

Across Phase 1 institutions, a pattern emerged: inadequate funding, governance fragmentation, technical challenges, and the absence of operational management frameworks led to incomplete installations or rapid system failures. 

UniAbuja and Alex Ekwueme Federal University (AE-FUNAI) successfully commissioned and sustained operations, demonstrating that the World Bank funding model's strengthened management and accountability mechanisms increased the likelihood of project completion and long-term sustainability. 

The different programmes affected institutional capacity outcomes. Where Phase 1 contractors could abandon sites without consequence, Phase 2's external funding structure enforced delivery standards. As a result, only Phase 2 universities could support student entrepreneurship.

Cost of Poor Electricity Policy on Student Entrepreneurship

It increases the institutional capacity gap: The institutional capacity gap undermines research output. Universities without reliable electricity are unable to maintain functional laboratories or support experiments that depend on constant power supply, limiting both faculty research and student-led innovation projects. This constraint contributes to Nigeria’s low investment in research and development (R&D) and, more broadly, weakens the country’s innovation ecosystem and knowledge-driven economy. 

Access to other entrepreneurship inputs: Many of the other entrepreneur inputs such as  capital access, mentorship, and market development are now accessible online, which majority of the students prefer, but the devices require electricity to power them. 

Business Loss: Due to poor electricity, students who cannot afford to run a generator for their  businesses lose customers to off-campus competitors during outages. Electricity is a necessary need for the growth of student businesses. A student with access to mentorship but no reliable power cannot run a printing business, sustain a tech support service, or operate the digital tools required for modern entrepreneurship. This is why addressing the electricity infrastructure is a necessary, not a sufficient, first step.

Recommendations: Ensuring Uniform Institutional Capacity

To create equal capacity across all federal universities to support student entrepreneurship, policy reforms must address funding mechanisms, accountability frameworks, and impact measurement.

The Federal Ministry of Education, with the Rural Electrification Agency, should audit all abandoned Phase 1 sites within six months, documenting status, liabilities, and costs. The results should guide a funding request to the World Bank, alongside continued Phase 3 disbursements, for a Phase 1 remediation plan based on Phase 2’s accountability mechanisms. No new EEP beneficiaries should be announced until existing commitments are complete or officially decommissioned with alternative plans. Evidence shows external funding ensures contractor accountability, standards, and sustainability better than domestically funded Phase 1.

Second, NERC should implement an automatic rebate for Band A customers with less than 20 hours of daily supply, calculated monthly from verified uptime data and applied to the next bill. This replaces the current scheme under which universities such as OAU pay premium rates despite actual service hours. Distribution companies must submit monthly uptime reports by institution, and NERC should publish them for third-party verification. Persistent non-compliance should lead to reclassification reviews.

Third, the Rural Electrification Agency, with university vice-chancellors, should conduct baseline and follow-up surveys of student business activity at EEP institutions. These surveys should record venture count, revenue, employment, and sector data within six months of plant commissioning and annually. Monitoring shifts to higher-value ventures will support investment justification, funding defence, and policy guidance.

Finally, federal infrastructure investment must create uniform institutional capacity across all universities. This requires adopting proven funding models, holding contractors accountable for completion, aligning tariffs with actual supply, completing abandoned projects before expanding to new beneficiaries, and measuring entrepreneurship outcomes to justify continued investment.

Electricity policy influences which universities support entrepreneurship. UniAbuja's solar hybrid plant shows that reliable infrastructure enables student businesses to grow, increase revenue, and focus on quality services. Failures at OAU and UI highlight that abandoned projects or lack of accountability hinder universities from fostering innovation-driven entrepreneurship.

For policymakers, In Nigeria, where 42% of graduates start businesses out of necessity rather than innovation, the question is not whether student entrepreneurship matters, but whether universities can provide the foundational infrastructure—starting with reliable electricity—to transform survival ventures into scalable companies. Federal infrastructure investment in universities determines whether the next Flutterwave emerges from a Nigerian campus or whether talent migrates to ecosystems with better enabling environments.

Also,without these reforms, the next generation of Nigerian entrepreneurs will remain divided: those fortunate enough to attend universities with reliable power will build scalable businesses. Those at universities still waiting for abandoned projects to be completed will continue printing by candlelight, running thrift shops out of necessity, and watching potential GDP contributions evaporate into diesel smoke.