The Federal Government is in advanced negotiations with China’s Export-Import Bank to secure a $2 billion loan for the development of a new electricity super grid, as part of broader efforts to solve Nigeria’s chronic power supply challenges.
Disclosing the plan at the 2025 Nigerian Economic Summit in Abuja on Monday, Minister of Power, Adebayo Adelabu, said the super grid would modernise and expand power transmission especially across the eastern and western corridors, where most of the country’s industrial users are located.
“It’s part of plans to decentralise power generation in Nigeria and get the heavy commercial users that left the power grid because of its unreliability to return,” Adelabu stated.
According to a Bloomberg report, Adelabu’s team confirmed that talks with China’s Exim Bank were progressing well. The proposal has already received Federal Executive Council (FEC) approval, clearing the way for financial closure once loan terms are finalised.
Nigeria’s Power Gap: Only 1/3 of Generated Electricity Reaches Consumers
Nigeria currently has an installed power generation capacity of 13 gigawatts, but only about 4 gigawatts are reliably transmitted to end users due to grid inefficiencies and frequent system collapses.
In comparison, South Africa, which has a population four times smaller than Nigeria, boasts approximately 70 gigawatts of generation capacity.
These shortfalls have pushed many Nigerian businesses to abandon the national grid in favour of self-generated electricity, which now accounts for nearly half of the country’s total energy consumption.
The proposed super grid is expected to boost transmission efficiency, reduce reliance on off-grid solutions, and restore confidence among industrial users, especially manufacturers.
Reforms Under Tinubu Boost DisCos Revenue by 70%
Since President Bola Tinubu assumed office in 2023, his administration has rolled out several economic reforms aimed at reviving investor confidence and overhauling the power sector. These include: removal of fuel subsidies, deregulation of electricity tariffs, improved security in oil-producing regions and tax system reforms.
Among these changes, a revised tariff structure for certain urban electricity users has helped improve the financial health of distribution companies.
According to Adelabu, this policy shift led to a 70% increase in revenue for electricity distribution companies in 2024, with total revenues projected to hit ₦2.4 trillion ($1.6 billion) by year-end.
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