FG to invest $800m in power substations and distribution networks

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The federal government has announced plans to invest $800 million in the construction of sub-stations and distribution networks under the Presidential Power Initiative (PPI). 

 

This investment is aimed at enhancing the country’s power infrastructure and is expected to address ongoing challenges in the power sector.

 

This was disclosed in a statement by Bolaji Tunji, Special Adviser on Media and Strategic Communication to the Minister of Power, in Abuja on Sunday, September 1. According to Tunji, the Minister of Power, Adebayo Adelabu, made the announcement during a visit to TBEA, a Chinese company specializing in power transformers and transmission projects, while in Beijing for the China-Africa Cooperation Summit.

 

Adelabu stated that the $800 million investment would be divided into two parts: $400 million for Lot 2, covering the franchise areas of Benin, Port Harcourt, and Enugu Distribution Companies (DisCos), and $400 million for Lot 3, covering the franchise areas of Abuja, Kaduna, Jos, and Kano DisCos.

 

The Minister expressed concerns over the rejection of power by DisCos, which has recently led to a reduction in generation capacity by 1,400 megawatts—from a peak of 5,170 megawatts—due to their inability to manage the supply. Despite this setback, Adelabu emphasized the government’s commitment to increasing power generation to 6,000 megawatts by the end of the year.

 

“When this administration came on board in 2023, we met about 4 gigawatts (4,000 megawatts) of power but within a year, we were able to generate a milestone of 5,170 megawatts,” Adelabu said. “That is about 1,000 megawatts of power within the first year. It may look small, but compared to the history of the country, this is commendable.”

 

He continued, “Our plan is by the end of the year, we aim to achieve 6,000 megawatts of power through a combination of hydroelectric power plants and our gas-fired power plant. We are also targeting 30 gigawatts of power to be generated, transmitted and distributed by the year 2030, out of which 30 percent will be renewable energy.”

 

Addressing the challenges in the power sector that have hindered industrial growth, the Minister pointed out that these issues are partly due to the fragility of the existing transmission and distribution infrastructure, which has become outdated and dilapidated. “This has led to historical epileptic supply of power to households, industry, and businesses,” he noted. “More than 59 percent of industries in Nigeria are off the grid. They did not see the national grid as reliable and dependable. So, a lot of them now operate their own captive, self-generated power.”

 

On the construction of a super grid, Adelabu highlighted that the current national grid could not support the long-term vision for the power sector. “If we look at the strength, the capacity, and the age of our existing network on the national grid, it cannot really support our vision for the power sector, hence the need for the construction of the western and eastern super grid,” he explained. “Though we have been on this since my assumption of duty, I can also tell you that the President is in full support of this because it will improve our transmission network. It will also stabilize the grid and expand the capacity and the flexibility of the grid.”

 

Adelabu concluded by saying that 90 percent of the necessary approvals for these projects are in place and will be finalized soon.

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