No Pay, No Gas! The embarrassing situation of Nigeria’s Electricity Generation.

Nigeria’s electricity sector is once again on the brink of collapse, as mounting debts owed by Power Generation Companies (GenCos) to gas suppliers threaten to plunge the nation into deeper darkness. At the heart of the crisis lies a staggering  ₦3.3 trillion debt  which has forced gas suppliers to halt or restrict supply to thermal power plants — the backbone of Nigeria’s electricity generation.

A System Built on Debt

Nigeria’s power value chain is structured in a way that links multiple players: GenCos generate electricity, which is purchased by the Nigerian Bulk Electricity Trading (NBET) company and then sold to distribution companies (DisCos).

However, this system has been plagued by chronic payment failures. Since the privatization of the power sector in 2013, GenCos have not been fully paid for the electricity they produce, leading to a massive accumulation of debt. ([Punch Newspapers][1])

As of early 2026:

Total debt owed to GenCos has risen to about ₦6.8 trillion. About 70% of that debt is tied to gas-fired (thermal) plants, Roughly ₦3.3 trillion is owed directly to gas suppliers. This financial imbalance has triggered a chain reaction across the entire power sector.

Gas Suppliers Pull the Plug

Gas is the lifeblood of Nigeria’s electricity sector, with thermal plants contributing about 70% of the country’s power supply. But with debts piling up, gas producers are no longer willing to continue business as usual. They have now made their position clear: No payment, no gas.

This has led to: Reduced gas supply to power plants, Shutdown of several generating units, Sharp decline in electricity output, Many power plants cannot operate, Electricity generation has dropped to dangerously low levels,  Load shedding has intensified across the grid

Reports show that power generation has dropped significantly, with supply falling far below national demand, worsening blackouts across the country.

Industry data indicates that Nigeria is generating only a fraction of its potential capacity, leaving homes and businesses to endure prolonged outages.

For millions of Nigerians, this translates into: Increased reliance on generators, Higher cost of living due to fuel expenses, Disruptions to businesses and economic activities

A Vicious Financial Cycle: The crisis is not just about unpaid bills — it is a systemic problem. GenCos argue that: They cannot pay gas suppliers because they are not paid by NBET, They are also struggling to service bank loans taken during privatization, Rising exchange rates have worsened their financial burden

At the same time, gas suppliers  facing their own operational costs  can no longer sustain unpaid deliveries. This creates a vicious cycle: Government owes GenCos → GenCos owe gas suppliers → Gas supply stops → Power generation collapses**

A Nation Rich in Gas, Yet Starved of Power

Ironically, Nigeria possesses over 200 trillion cubic feet of proven gas reserves, yet struggles to supply enough gas to power its own plants. This contradiction highlights deeper structural issues: Poor financial management in the power sector, Weak enforcement of payment systems, Lack of sustainable pricing mechanisms

Government Response

The Federal Government has acknowledged the crisis and says it is working to resolve the gas supply challenges.

Proposed solutions include:

a.     Settling part of the outstanding debts

b.     Issuing bonds to clear legacy liabilities

c.     Improving liquidity in the power sector

However, analysts warn that without long-term structural reforms, these measures may only provide temporary relief.

The Bigger Picture: The GenCos gas debt crisis is more than an industry problem , it is a national emergency.

 

Electricity is the backbone of economic growth. Without stable power:

a.  Industries cannot function efficiently

b. Small businesses struggle to survive

c.  Investors are discouraged

Ultimately, the burden falls on ordinary Nigerians, who continue to pay the price through unreliable power supply and rising living costs.

Conclusion

The ₦3.3 trillion debt owed to gas suppliers has exposed the fragile foundation of Nigeria’s power sector. What began as a financial imbalance has now escalated into a full-blown energy crisis.

Until the cycle of debt is broken and the sector is restructured, Nigeria risks remaining trapped in a loop of power shortages, economic strain, and missed opportunities.

For now, the message from gas suppliers is clear — and the consequences are already being felt nationwide.

Read also Aso Rock’s Planned Exit from the National Grid: A Subtle Signal to State Governments and a turning point in Nigeria’s Electricity landscape

How Mercor founders Uses Human Experts to Train Smarter AI Systems

 

As artificial intelligence continues to reshape industries, one critical truth has become clear: machines cannot learn effectively without human guidance. This is the gap Mercor has stepped in to fill—by transforming highly skilled professionals into active trainers of AI systems.

Rather than relying solely on raw data, Mercor has built a model that integrates human expertise directly into the learning process of artificial intelligence. The result is a new hybrid system where humans and machines work side by side to produce more accurate, reliable, and practical outcomes.

From Professionals to AI Trainers

At the core of Mercor’s approach is the recruitment of experts across key fields—engineering, law, medicine, and data analysis. These professionals are not just users of AI tools; they play a much deeper role as evaluators and instructors.

Engineers, for instance, review AI-generated code, identifying errors and suggesting improvements. Lawyers assess legal arguments and contracts produced by AI systems, ensuring logical consistency and compliance with legal standards. Doctors evaluate medical outputs, checking for accuracy and safety, while analysts interpret data-driven responses to ensure sound reasoning.

Through this process, human expertise becomes a guiding force that shapes how AI systems think and respond.

Teaching AI Through Structured Feedback

Artificial intelligence learns best from structured examples. Mercor leverages this by assigning experts tasks such as labeling data, ranking AI-generated responses, and providing detailed corrections.

For example, an expert might be asked to compare multiple answers generated by an AI system and rank them from best to worst. This helps the system understand not just what is correct, but what is most useful or most appropriate in a given context.

This method ensures that AI systems are not only technically accurate but also aligned with real-world expectations.

The Role of Human Feedback in Machine Learning

A central technique behind Mercor’s model is Reinforcement Learning from Human Feedback. In this approach, AI systems generate responses which are then reviewed and scored by human experts.

Over time, the system learns patterns from these evaluations—gradually improving its ability to produce high-quality answers. This continuous interaction between humans and machines helps reduce errors, bias, and misleading outputs.

Simulating Real-World Intelligence

One of Mercor’s most impactful strategies is the use of real-world scenarios. Instead of abstract training, experts engage AI systems with practical problems:

• A medical case study reviewed by a doctor

• A legal dispute analyzed by a lawyer

• A coding challenge assessed by an engineer

By exposing AI to these scenarios, Mercor ensures that systems develop not just theoretical knowledge but practical intelligence that can be applied in real-life situations.

A Continuous Learning Loop

Mercor’s system operates as an ongoing cycle of improvement. AI generates outputs, experts review and correct them, and the feedback is reintegrated into the system. This loop repeats continuously, allowing the AI to evolve rapidly.

The advantage of this model lies in its balance: it combines the speed and scalability of machines with the critical thinking and judgment of humans.

Implications for the Future of Work

Beyond improving AI performance, Mercor’s approach is also reshaping the global workforce. By tapping into a distributed network of professionals, the company creates new opportunities for remote work across the world, including in emerging markets like Nigeria.

At the same time, it highlights a broader shift in the role of human labor—from performing routine tasks to guiding and supervising intelligent systems.

Conclusion

Mercor’s use of skilled human experts represents a significant evolution in how artificial intelligence is developed. By positioning professionals as teachers rather than replacements, the company is building AI systems that are not only smarter but also more aligned with human values and real-world needs.

In a world increasingly driven by automation, Mercor’s model offers a compelling reminder: the future of AI still depends on human intelligence.

Mercor is a fast-rising artificial intelligence company founded in 2023 it connects skilled professionals with AI firms to train models. It was launched  In 2023, by the above trio in the picture Mercor.

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