Despite Nigeria’s vast and diverse untapped potential in solar, wind, biomass, and small-scale hydropower, a significant and persistent gap remains between national policy ambition and the practical implementation of renewable energy projects. This study investigates the underlying structural reasons why existing sustainable energy strategies have failed to significantly reduce fossil-fuel dependency or resolve chronic electricity shortages, particularly within underserved semi-urban and rural communities where energy poverty remains a major barrier to development. Through a comprehensive thematic analysis of current regulatory frameworks, international development reports, and peer-reviewed academic literature, the research identifies critical bottlenecks in the energy transition process, with a specific focus on the deployment of solar mini-grids and decentralized energy systems as viable alternatives to the struggling national grid. The findings reveal that progress is hindered not by a lack of natural resources or high-level policy intent, but by fragmented institutional coordination, weak regulatory enforcement, and a lack of robust de-risking mechanisms necessary to attract essential private sector investment. The study highlights that the current reliance on thermal power plants fueled by gas and oil continues to cause significant environmental degradation and economic instability. To bridge this implementation gap, the paper proposes a multi-dimensional strategic framework centered on fostering inter-agency synergy, implementing specialized capacity-building programs for both policy-makers and technical personnel, and the stabilization of financial foundations for renewable infrastructure through targeted incentives. The study concludes that strengthening these institutional, financial, and technical pillars is the vital prerequisite for translating high-level policy commitments into measurable, sustainable development outcomes in addition to good and revised government policies to engage more stakeholders in the energy sector. Furthermore, the lessons derived from the Nigerian context offer a scalable roadmap for low-carbon growth and socioeconomic transformation that is highly relevant for other West African nations pursuing similar sustainable energy goals in the face of global climate challenges and the urgent need for a regional energy transition.