Nigeria is languishing somewhere at 148 out of 164 countries on the 2022 Internet Accessibility Index
Nigeria’s telecom operators are pursuing a balancing act of cutting today’s diesel costs while laying the groundwork for a greener, more resilient future.
With the industry spending an estimated N504 billion annually on diesel to power more than 40,000 base stations, the push for energy reform has become not just a cost imperative, but a survival strategy.
According to the Nigerian Communications Commission (NCC), operators consume over 40 million litres of diesel every month, roughly 480 million litres yearly. At a unit price of N1,050 per litre, the bill adds up to N504 billion.
Femi Adeniran, director of Corporate Communications and Corporate Social Responsibility at Airtel Nigeria, had stated that the company spends approximately N28 billion monthly on diesel.
Reports indicate that MTN Nigeria incurs roughly N30 billion in monthly diesel expenses to power its 25 base stations.
For an industry where energy accounts for as much as 35 percent of operating costs, the figure underscores the urgent need for alternatives.
Historically, most of the diesel used in telecom operations has been imported, leaving operators vulnerable to global oil price swings and currency depreciation. Each spike in the international market translates into higher operational costs, squeezing margins and threatening service quality.
Read also: Telecom operators to pump $1 Billion into Nigeria’s networks by 2025 – NCC
Dangote refinery relief
However, the arrival of the 650,000-barrels-per-day Dangote Refinery is now seen as a near-term relief. By supplying diesel locally, the refinery reduces import dependence, helps to ease dollar demand and stabilise operator budgets.
The NCC expects this forex breathing space to allow telcos to redirect scarce foreign exchange into essential imports of radios, fibre equipment, and core software, investments critical for the planned $1 billion network expansion in 2025.
“As the refinery ramps up, operators will no longer be fully exposed to the volatility of the international oil market. That relief is essential to ensure energy costs don’t overwhelm investment in quality-of-service improvements” Aminu Maida, executive vice-chairman of the NCC, told BusinessDay.
Yet, industry leaders are clear that local refining is only a stopgap. The longer-term solution lies in renewables and hybrid energy systems that cut operating costs while advancing climate targets.
Read also: NCC targets network resilience amid energy supply volatility
Energy shift
MTN Nigeria, in its 2024 Sustainability Report, highlighted progress on its ‘Project GreenCycle,’ eco-friendly SIMs, and a growing portfolio of solar-powered sites. The company has already reduced Scope 1 & 2 emissions by 11 percent against its 2021 baseline, with targets to cut 50.3 percent by 2030 and achieve net zero by 2040.
Airtel Nigeria is also focused on shifting from generators to grid power. “Our first goal is to connect all of our sites to the grid. Once we achieve this, our diesel consumption and reliance on generators will fall drastically,” Airtel Nigeria added.
Independent tower companies like IHS Towers are also rolling out solar-hybrid solutions and gas mini-grids, leveraging falling costs of solar panels and batteries to improve uptime economics in underserved regions.
The shift also addresses a longstanding vulnerability: theft and vandalism at diesel-powered sites. Fuel siphoning, generator theft, and battery vandalism have cost operators millions in losses and disrupted services across communities.
While diesel will not disappear from the energy mix overnight, operators are pursuing a dual-track strategy: leveraging Dangote’s local diesel production to cushion immediate forex strain, while scaling up green and grid-based alternatives for sustainable savings.
This balance is critical for ensuring continued investment in rural expansion and service quality. For consumers, the payoff could mean fewer outages, faster speeds, and broader coverage, with room for tariff stability as operators achieve structural cost reductions.
“When operators deploy renewable-powered stations and even extend benefits like community charging points, the local population becomes a stakeholder in protecting the infrastructure. It reduces conflict, reduces theft, and ensures services are more reliable,” Maida explained.
