The Commercial Cooking Sector in Nigeria: Exploring Electric Cooking

By Jacob Fodio Todd, Chibuzor Mgbeokwere, Uchenna Prince Obiodu, Richard Sieff

Introduction

Everybody needs to eat, and increasingly many people choose to or are required to eat outside of the home in the broad spectrum of businesses that make up the commercial cooking sector¹. In 2019, Nigerians reportedly spent a staggering 56.65% of their income on food – an estimated ₦22.8 trillion ($60-70 billion) – 17.5% of which is spent on food consumed outside-of-home (OOH). This sector is growing rapidly and serves as a vital pillar of the Nigeria’s economy, worth an estimated $7 billion. It generates significant employment and caters to a diverse population reflecting the country’s considerable cultural and culinary heritage.

The OOH consumption sector, especially from an energy perspective, is little understood. To help capture data from this under researched area, a recent short study commissioned by the MECS Programme was undertaken by SheConsults 4 ImpactSphere (SC4IS) in Nigeria, and another by Kijani Testing, in Uganda. The Nigerian study sought to better explore the characteristics of these businesses, understand their energy use and demands, and start to discover opportunities and challenges for electric cooking in the commercial cooking space.

Preliminary investigation from the study corroborated the paucity of information on energy use and the commercial cooking sector in Nigeria: desk research yielded little literature, broader evidence or publicly accessible reports. However, this rapid and ambitious study, undertaken from Oct 2024 – January 2025, across six geopolitical zones, resulted in wide data collection. Surveys with 451 commercial establishments, 145 supply chain actors, 17 focus group discussions, numerous key informant interviews and ethnographic study revealed the breadth and diversity of organisations that operate as commercial food businesses. It revealed some thought-provoking initial trends, as discussed below.

Micro and local businesses dominate

The study identified establishments in four key segments: local restaurants (commonly known as bukkas or mama put); street food vendors (including hawkers and street stalls); modern restaurants (including lounge and quick service restaurants), and home-based catering. Among the businesses surveyed, micro businesses dominate with 86.25% of businesses reporting having fewer than 10 employees. The most abundant among all segments were street food vendors and local restaurants, typically informal and resource-light establishments that specialise in accessible and culturally resonant food options, such as traditional Nigerian dishes (cooked by 58.1% of businesses). In the areas surveyed, they accounted for 91.2% of the businesses found, far outweighing the presence of modern restaurants (6.4%) and home based-caterers (2.4%).

A diverse cooking fuel mix

Interestingly, LPG was on average the most commonly used single cooking fuel and has strong penetration on account of its efficiency and speed compared to traditional fuels, according to respondents. It was the dominant fuel (65%) among the modern restaurants that took part, and electricity is reported as a common primary cooking fuel by 18.4% of these. This contrasts with other segments, where the next highest use was amongst home-based caterers, about 10% of whom reported using electricity as a primary fuel. However, all segments reported using electricity to some degree, which shows an interest in the fuel. Equally the uptake of LPG across all segments might indicate a willingness and dynamism in the commercial cooking sector to adopt modern cooking fuels: penetration compares favourably with national household statistics where estimates show that electricity is used by 0.6% of population and LPG by 10%.

Fuel price fluctuations present a complex picture for cooking fuels for businesses

Government policies, such as the National LPG Expansion Plan, have increased awareness around the fuel although recent rampant inflation has impacted operational costs for LPG, with some returning to traditional fuels. However, regulations, such as local government restrictions on illegal logging of firewood and charcoal, have driven up their prices. Meanwhile recently increased electricity tariffs – amplified by the 2024 removal of the electricity subsidy – could discourage the adoption of electricity for cooking. However, the government continues to promote the use of clean cooking fuels through the National Clean Cooking Policy and policies around LPG (the aforementioned, and the LPG National Policy).

Regional differences in fuel use

The national grid serves as the primary electricity source for commercial cooking across the board. However, the surveys showed the irregularity of electricity for grid customers across Nigeria, with only 6% of businesses constantly having electricity available and 64% reporting availability for just 8 hours a day, with the situation worst in northern zones (north-east and north-west) and southern zones reporting higher electricity access. However, some areas are exceptions: electricity usage in the north central states of Abuja and Niger are relatively higher due to government investment in electricity infrastructure, the policy environment and greater awareness in these areas. Equally, other fuels demonstrate regional variation, states in northern Nigeria show greater usage of wood, while southern states – which have stronger LPG distribution networks – show higher use of LPG.

Modern equipment supply chains are underdeveloped but growing

Urbanization, among other drivers, has been attributed as contributing towards the growth of dining-out culture and increasing consumer demand for diverse cuisines. This in turn drives the need for efficient and versatile cooking equipment. The Nigeria commercial cooking equipment market is characterized by a strong local supply chain network, with distributors relying on sourcing from urban centres such as Lagos and Abia states, in both wholesale and retail segments. However, there is a heavy reliance on imports – predominantly from China and the USA – for modern cooking technologies. There is limited local production and distribution networks. The demand for advanced cooking solutions in the food service industry is growing, but challenges such as high costs, low adoption rates, and regulatory barriers persist. Government policies emphasizing food safety, equipment standards, and energy efficiency are shaping the market, though the market remains underdeveloped.

eCook opportunities & challenges

The two key drivers of adoption of eCooking among the businesses polled are efficiency and cost-effectiveness while key barriers are high upfront cost of equipment and lack of electricity supply. Ways of mitigating these through flexible payment options, leveraging local manufacturing and focussing on the potential of solar, particularly in rural and peri-urban areas, were identified. The survey also identified challenges with product damages, high transportation costs, customs delays, import tariffs, taxes, and complications with clearing goods.

Conclusion

Given the breadth of establishments and the presence of a wide range of actors, the commercial cooking sector in Nigeria requires cohesive stakeholder engagement, bridging the roles of government agencies, private sector players, NGOs, industry associations, and financial institutions. The study revealed insights into businesses that make up the sector and shed light on the establishments and sector as well as highlighting areas that would benefit from further study. This includes more quantitative and qualitative research to address literature gaps and learn more from the range of regional and local vendor, restaurant and street food associations, who have a wider sectoral lens and would help to strengthen the knowledge base around commercial cooking.

Download the findings and learn more by clicking on below image:

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Endnotes:

¹ Commercial cooking businesses are defined as businesses that are both the site of production and serving/consumption.

Featured Image: A Nigerian food business using electric cooking equipment. Photo Credit: SheConsults4ImpactSphere, 2024.