The Federal Government has disclosed plans to secure part of the $10 billion needed to ensure consistent and reliable electricity across the country from the private sector over the next five to 10 years. This initiative is a key component of the government’s broader strategy to tackle Nigeria’s long-standing power supply challenges.
The decision was one of the key outcomes of the meeting between the Director-General (DG) of the Infrastructure Concession Regulatory Commission (ICRC), Dr Jobson Ewalefoh, and the Minister of Power, Chief Adebayo Adelabu.
According to a statement by the acting Head of Media and Publicity at the ICRC, Ifeanyi Nwoko ICRC, the duo agreed that given the funding and technical requirements needed to develop the power sector in Nigeria, it has become imperative to seek private sector input through Public Private Partnership (PPP) in co-financing and providing expertise that would ensure optimal performance of power infrastructure.
Recall that following the recent collapse of the national grid, Minister of Power Adebayo Adelabu ordered the immediate replacement of aged equipment, in line with recommendations aimed at preventing further grid failures.
Speaking at the meeting, the Minister stated that additional funding would be needed from the 2024 Supplementary Budget and the 2025 Appropriation Bill to address the financial challenges of implementing strategies to prevent further grid collapses. He also highlighted that Nigeria requires a minimum investment of about $10 billion over the next 10 years to achieve a 24-hour power supply nationwide.
As indicated by Adelabu, “The government cannot afford that when there are funds critical sectors in need of funding. Can the government do it alone? No! This is why we have to look for or marshal private sector funds while still retaining government interest and ownership. That is where ICRC comes in. We need to do this in collaboration with the private sector, and the best way is through concessions.”
In response to the minister’s comment, the DG stated that through its regulatory processes, the ICRC can facilitate private sector investment in part of the $10 billion needed for the power sector. This will help ensure regular electricity supply, attract more foreign direct investment to other sectors, and ultimately drive economic growth.
Ewalefoh explained that, in line with President Bola Tinubu’s directive to boost PPP investments, the ICRC has introduced a six-point policy framework that has streamlined the process of delivering PPP projects.
The Director-General emphasized that while the new processes aim to speed up project delivery and encourage greater adoption of PPPs, the commission remains committed to its stringent regulatory role. This includes preventing contingent liabilities and avoiding unnecessary delays caused by companies lacking the necessary capacity.
The ICRC chief further highlighted that the commission is now requiring “conditions precedent” in all PPP agreements, ensuring that any preferred bidder who defaults will have their agreement automatically nullified.
