National Grid: FG sets terms for willing investors

The Federal Government is crafting a new investment model aimed at drawing private capital into the expansion and stabilisation of Nigeria’s national electricity grid, in a renewed effort to guarantee consistent and adequate power supply across the country.Minister of Power, Chief Adebayo Adelabu, revealed in an interview this week that the administration has begun outlining a detailed set of terms and conditions that will serve as a foundation for increased private sector participation in the nation’s transmission infrastructure.He explained that the new model will be built on a mutually beneficial structure that allows government access to vital infrastructure funding while providing private investors with clear avenues to recoup their investments along with competitive returns.

“Some investors have already shown interest in constructing transmission lines,” Adelabu stated. “We are now working on developing the right framework to make it commercially viable for them to recover their costs. That’s our next step—setting the structure to allow cost recovery for private investments in a transparent and sustainable way.



”The minister disclosed that studies are already underway to formally engage interested investors. He acknowledged the limitations of relying solely on public funds, noting that the sheer size and scope of the national grid make full government financing unfeasible.“We’ve received various offers from private investors.

While the grid is currently 100 percent government-owned, the fiscal demands from other ministries mean we cannot shoulder the cost alone,” he said. “The grid is expansive, and some of the dedicated lines are already attracting private interest.”In a separate statement issued by his Special Adviser on Strategic Communications and Media, Bolaji Tunji, Adelabu pointed to recent progress under the Presidential Power Initiative (PPI), more widely known as the Siemens deal, and credited the Tinubu administration with breathing new life into the long-standing project.

He said the federal government had signed an accelerated contract under the PPI, aimed at ensuring swift and visible progress in bolstering Nigeria’s electricity infrastructure.“The PPI was conceived in August 2018, born from a strong bilateral relationship between Nigeria and Germany, with the objective of overhauling our power sector by expanding generation, transmission, and distribution capacity,” he said. “This administration, under President Tinubu’s leadership, has demonstrated steadfast commitment to the initiative, recognising its significance in unlocking economic potential and driving national development.

”To fast-track implementation, President Tinubu directed the signing of an Acceleration Agreement, which Adelabu said has already yielded tangible outcomes. Enhanced programme oversight, quicker contract approvals, and more efficient financing mechanisms have accelerated the pace of delivery, he noted.Among the notable developments under the current administration is the approval of a revised technical focus for the PPI.

Under this new arrangement, Siemens Energy will concentrate exclusively on modernising the transmission network through a Turnkey approach, while other trusted Engineering, Procurement and Construction (EPC) firms will be engaged to handle the distribution aspect, provided they meet rigorous technical and financial benchmarks.According to Adelabu, these strategic realignments are designed to raise grid capacity by an additional 4,000 megawatts by the end of 2026, with an additional aspirational target of 2,000 megawatts set for 2024 by the Economic Management Team.He also cited the installation and commissioning of 10 power transformers and 10 mobile substations across the country in October 2023 as a key milestone marking the beginning of the pilot phase of the PPI.

This year’s focus, he said, has been on executing the pilot project and initiating groundwork for the main phase.Adelabu further disclosed that the FGN Power Company has delivered multiple transmission projects nationwide under the Tinubu administration, collectively boosting transmission wheeling capacity by more than 700 megawatts for industrial zones, educational institutions, businesses and residential areas.The post National Grid: FG sets terms for willing investors appeared first on Nigerian NewsDirect.

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