on switch

Nigeria approves 1,650MW hydropower project, official says

By Reuters

Posted on November 16, 2022 15:52

A view of the switches and meters at a control board is seen inside Egbin power plant in Ikorodu on the outskirts of Nigeria’s commercial capital Lagos
A control board iat Egbin power plant in Ikorodu on the outskirts of Nigeria’s commercial capital REUTERS/Akintunde Akinleye

Nigeria has approved the construction of a 1,650MW hydropower plant at a cost of $3bn, making it one of the single biggest power projects in the country, the vice president’s spokesperson said on Tuesday. It comes as private sector financing for the sector is growing, with the recent listing of Geregu Power PLC.

The project would be funded under a public private partnership arrangement and located in the north central state of Benue, Laolu Akande, vice president Yemi Osinbanjo’s spokesperson, said in a statement.

Akande did not say when construction would start.

Increasing the power supply is expected to top the agenda of the successor to President Muhammadu Buhari, who steps down after elections next year.

Africa’s biggest economy struggles with low power output and limited transmission infrastructure, leaving many households and businesses reliant on diesel-powered generators.

Hydropower plant

Authorities said last week the government would grant a concession to operate its $1.3bn China-funded Zungeru hydropower plant that will come on stream in the first quarter of next year.

It comes among signs of a private sector-led renaissance in the country.

Nigeria’s first private power generation company (GenCo), Geregu Power Plc, has become the first of its kind to list on the main board of the Nigerian Exchange Group (NGX), signalling the start of more transparency in the sector and potentially cheaper access to long term capital, say some experts.

Geregu Power Plc listed 2.5 billion ordinary shares at N100 each in October this year, with the value of the stock rising by 10% on the first trading day amid high investor demand. The company is owned by Nigerian billionaire Femi Otedola.

“I have looked forward to seeing the first listed electricity company in Nigeria,” says Eyo Ekpo, CEO at Excredite Consulting Limited, and a former commissioner at Nigerian Electricity Regulatory Commission (NERC).

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