Nigeria is in serious talks with China’s Export-Import Bank for a $2 billion loan meant to build a new super grid transforming Nigeria’s electricity infrastructure.
The project, for decades, has aimed to address the unrelenting power outages that have hampered industrial expansion and economic growth.
According to the Minister of Power, Adebayo Adelabu, the planned grid would connect the eastern and western areas of the country, where most of Nigeria’s major industries are found. Adelabu said during an economic summit in Abuja that the scheme is part of a larger strategy to decentralize electricity generation and promote manufacturers and big organizations to reconnect to the national grid after years of reliance on private generators caused by poor supply.
Nigeria has a generating capacity of about 13 gigawatts now, but the central grid can supply just a third of that to over 200 million inhabitants. Regular grid failures and poor distribution networks have made the situation worse. South Africa, with a population about one-fourth the size, has an installed generating capacity of almost 70 gigawatts by contrast.
The News Chronicle gathered that the $2 billion finance plan already sanctioned by the cabinet will go towards creating a contemporary super grid capable of giving more electricity to metropolitan regions and industrial clusters. The project seeks to lower Nigeria’s reliance on self-generated power, which now makes up practically half of all the country’s electricity consumption.
Adelabu verified that conversations with China’s Eximbank are going along well, as both parties agree on the financing approach and project execution schedules. Emphasizing that the new grid would not only stabilize power delivery but also draw in fresh investment, increase output, and improve energy security across Nigeria’s industrial corridors.
Since President Bola Ahmed Tinubu took power in 2023, the administration has launched a number of aggressive economic policies designed to boost expansion and revive investor confidence. These comprise a tax system revision, oil industry security upgrades, and the elimination of fuel subsidies. Tariff changes for metropolitan consumers in the power industry have increased liquidity, therefore generating a 70% increase in income for distribution businesses in 2024. With an anticipated 41% increase to around 2.4 trillion naira ($1.6 billion), revenues will help to validate the industry’s course of financial viability.
