Nigeria is currently in talks with China’s Export-Import Bank to secure a $2 billion loan aimed at financing a new “super grid” project that will transform the nation’s electricity transmission system. The initiative seeks to resolve Nigeria’s persistent power supply challenges and stimulate industrial growth by ensuring more stable and efficient electricity distribution nationwide.
Government’s Power Sector Vision
The Minister of Power, Adebayo Adelabu, announced the plan during an economic summit in Abuja, emphasizing that the new super grid will connect Nigeria’s eastern and western regions — areas that host the country’s largest industrial consumers. The project, he explained, is part of the federal government’s broader agenda to decentralize power generation and encourage industrial users who have disconnected from the unreliable national grid to return.
“This is part of our plan to decentralize power generation in Nigeria and get the heavy commercial users that left the grid due to unreliability to return,” Adelabu stated.
He further revealed that the Federal Executive Council (FEC) has already approved financing for the project, underscoring its priority status within President Bola Tinubu’s economic reform agenda.
Why Nigeria Needs a Super Grid
Nigeria’s fragile power infrastructure has long been a major constraint on economic productivity. Despite an installed generation capacity of about 13 gigawatts, only a fraction—approximately 4 gigawatts—is typically delivered to consumers across a population exceeding 200 million.
For comparison, South Africa, with just a quarter of Nigeria’s population, boasts an installed capacity of around 70 gigawatts. This stark contrast highlights the scale of Nigeria’s power deficit.
The unreliability of the grid has forced many industries and households to generate their own power, often through diesel and gas generators, which account for nearly half of the electricity consumed nationwide. The proposed super grid aims to modernize transmission infrastructure, improve efficiency, and expand power access to industrial clusters.
Boosting Industrial Productivity and Energy Access
Adelabu explained that the new super grid will not only reduce transmission losses but also ensure more power reaches industrial zones, supporting the government’s goal of boosting local manufacturing and reducing operational costs for businesses.
The initiative aligns with President Tinubu’s comprehensive economic reforms, which include:
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Removing fuel subsidies to free up government revenue.
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Reforming tax laws to encourage investment.
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Enhancing oil production through improved security in the Niger Delta.
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Stabilizing the financial sustainability of the power sector.
Improved Revenue from Tariff Adjustments
According to the Power Minister, recent tariff adjustments for urban consumers have started yielding results, increasing the sector’s revenue by 70% in 2024, with projections suggesting an additional 41% rise to N2.4 trillion ($1.6 billion) in 2025. These adjustments are intended to create a more financially viable electricity market that can attract private investment and support infrastructure upgrades like the super grid.
Nigeria’s Persistent Grid Collapse Problem
Despite multiple reform efforts, grid collapses remain a recurring issue in Nigeria’s power sector. Data from the Nigerian Electricity Regulatory Commission (NERC) shows that the national grid experienced several partial and total collapses in 2024, highlighting the sector’s vulnerability to technical and infrastructural faults.
In March 2024, widespread outages were reported after the national grid went down, plunging several states into darkness. A similar collapse occurred again in September, reinforcing the urgency for significant transmission system upgrades.
What Lies Ahead
The proposed $2 billion super grid project could mark a turning point in Nigeria’s decades-long struggle with unreliable electricity supply. If successfully executed, it is expected to:
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Enhance power stability across the country.
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Boost industrial output through reliable energy access.
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Reduce dependence on self-generation and fossil fuels.
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Encourage foreign and local investment in the energy sector.
As Nigeria seeks to industrialize and diversify its economy, improved electricity infrastructure remains a critical foundation for sustainable growth. The partnership with China’s Exim Bank—if finalized—could provide the necessary financing and technology to make the long-awaited transformation of Nigeria’s power sector a reality.
