The Federal Government of Nigeria has unveiled plans to partner with the private sector to raise part of the $10 billion needed to establish a consistent and reliable electricity supply across the country. This initiative is part of a broader strategy aimed at addressing Nigeria’s long-standing power supply issues, with a projected timeline of five to ten years.
The details were shared following a courtesy visit by the Director-General of the Infrastructure Concession Regulatory Commission (ICRC), Dr. Jobson Oseodion Ewalefoh, to the Minister of Power, Adebayo Adelabu, in Abuja. According to a statement by the Acting Head of Media and Publicity, Ifeanyi Nwoko, both officials agreed that due to the significant funding and technical requirements for improving Nigeria’s power sector, private sector involvement through Public-Private Partnerships (PPP) will be essential for co-financing and providing the necessary expertise to optimize power infrastructure.
In addition, the Minister of Power emphasized the urgent need to replace outdated equipment as part of measures to prevent the frequent collapse of the national grid. He also stated that further funding would be required from both the 2024 Supplementary Budget and the 2025 Appropriation Bill to address the financial demands of the strategies aimed at resolving grid issues.
During the meeting, it was revealed that the country needs at least $10 billion over the next decade to achieve a stable 24-hour power supply.
He said, “To achieve a 24-hour power supply across Nigeria within the next five to ten years, a minimum funding of $10bn is required. The government cannot shoulder this alone given the pressing financial needs of other critical sectors.
“Can the government do it alone? No! This is why we need to marshal private sector funds while still retaining government interest and ownership. This is where ICRC comes in. We need to collaborate with the private sector, and the best way to do this is through concessions.”
Reacting to the minister’s statement, the Director-General said that through its regulatory processes, the ICRC could facilitate private sector investment in part of the $10bn required to improve the power sector, attract more foreign direct investment into other sectors, and ultimately stimulate economic growth.
The ICRC DG acknowledged that while funding is crucial, the challenges facing the power sector are complex and extend beyond finances.
However, with inter-agency collaboration and private-sector involvement, these limitations can be addressed.
He said, “Revamping the power sector requires planning, investment, and time. We need to collaborate to resolve the issues in this sector. The investment required is vast, and the government cannot fund it alone, so we must leverage the private sector’s financial capacity. That is why the ICRC was established—to regulate this leverage.”
The Commission is committed to regulating the processes of attracting investment into the power sector.
He commended the minister for his extensive knowledge of the sector and stated that President Bola Tinubu’s choice of him was commendable.
Ewalefoh said that to accelerate PPP investment as directed by President Tinubu, the Commission had issued a six-point policy direction, which has streamlined the PPP process for service delivery.
The DG stressed that although the processes have been streamlined to accelerate project delivery and encourage investors to adopt PPP models, the Commission remains vigilant in its regulatory function to prevent contingent liabilities or unnecessary delays by companies lacking the necessary capacity.
Ewalefoh also noted that the Commission now insists on incorporating conditions precedent into all PPP agreements, stipulating that any preferred bidder who defaults on the terms of the agreement will have their contract automatically nullified.
