Nigeria To Invest Us$519m In Power Sector To increase Generation Capacity And Distribution Efficiency


The Federal Government of Nigeria has announced plans to invest N198.28bn (around US$519.69 million) on various capital projects in the power sector in different parts of the country in 2021.

The projects will improve the country’s power generation capacity and distribution efficiency which has for a long time remained inefficient, greatly hampering efforts to increase energy access in Nigeria.

Due to inability, Nigeria currently generates between 4,000 megawatts and 5,000MW, despite the country’s total installed power generation capacity is about 13,000MW.

“Out of the 13,000MW installed capacity in Nigeria, 8,000MW is available and ready to run but we are doing less than 5,000MW today,” Chiedu Ugbo, Managing Director, Niger Delta Power Holding Company said.

To correct this situation, Different sectors in the power industry have been mapped out to partake in the US$519 million fund for capital projects in the 2021 budget proposal that was recently submitted to the National Assembly.

The Federal Ministry of Power will make the largest investment as it targets to invest US$456 million on capital projects during the period.

National rural electrification, managed by the Rural Electrification Agency, will invest a total of US$46.88 million on power infrastructure development in rural communities.

In additional to this, the Nigerian Electricity Regulatory Commission plans to invest N294.1m (around US$774,000) on capital projects, while capital projects to be handled by the Nigerian Electricity Management Services Agency will gulp N441.1m (around US$1.16 million).

Cumulatively the total allocation for capital projects to be handled by the Transmission Company of Nigeria, as contained in the budget, will amount to N4.69bn (around US$1.23 million).

Likewise the capital outlay projected for 2021 by the Nigeria Electricity Liability Management Limited is N914.87m (about US$2.40 million), while the National Power Training Institute targets to invest N294.1m (around US$771,000).

The Managing Director, Niger Delta Power Holding Company, Chiedu Ugbo, projected that the country’s power supply would as a result of the recent investments in the sector, increase from 5,000MW to 7,000MW next year.

He said that that the contract granted to German conglomerate Siemens by the Presidential Power Initiative would help boost the country’s electricity sector and grow the quantum of power on the grid.

Ugbo explained that what Siemens had come to do through the project is to help clean up the networks and improve the efficiency of electricity transmission.

He said all the technical loses would be cleaned out once the project is completed, adding that commercial loses would be resolved and the collection by way of metering would be done.

“So in the next one year or there about, we will be able to get at least 7,000MW of that taken up and served to Nigerians,” Ugbo stated.