The Federal Government of Nigeria is in advanced talks with China’s Export-Import Bank for a $2 billion loan to construct a new electricity super grid aimed at resolving the country’s long-standing power supply issues.
According to Bloomberg, the proposed grid will strengthen power transmission across Nigeria’s eastern and western regions, which host most industrial consumers.
Minister of Power Adebayo Adelabu revealed the plan at an economic summit in Abuja on Monday, describing it as part of a strategy to decentralize power generation and encourage large commercial users—many of whom disconnected from the national grid due to its unreliability—to reconnect.
“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 said.
Bloomberg reports that discussions with China’s Exim Bank are progressing, and cabinet approval for financing the super grid has already been secured.
Nigeria currently generates around 13 gigawatts of electricity, but only about a third reaches consumers because of frequent grid failures. For comparison, South Africa, with a quarter of Nigeria’s population, has roughly 70 gigawatts of installed capacity.
The unreliable power supply has forced many businesses to rely on self-generated electricity, which now accounts for nearly half of national consumption.
The new super grid is expected to improve electricity distribution to industrial hubs, supporting manufacturing growth and broader economic development.
Since President Bola Tinubu took office in 2023, his administration has implemented economic reforms including the removal of fuel subsidies, a tax overhaul, and improved security in oil-producing regions to attract investment.
The government also approved higher tariffs for some urban consumers to improve the financial viability of the power sector. Bloomberg notes that this policy led to a 70 per cent revenue increase for electricity distribution companies in 2024, with projections to reach ₦2.4 trillion ($1.6 billion) in 2025.