FG Plans to Spend $800 Million On Construction of Power Substations, Distribution Lines

The Federal Government is planning more investment in the distribution segment of the power sector. This investment will be in the region of $800 million.

The Minister of Power, Adebayo Adelabu, disclosed this in far-away China when he visited TBEA Southern Power Transmission and Distribution Industry in Beijing, China.

The projects which come under the Presidential Power Initiative will see to the reinforcement of many substations and distribution networks.

This was revealed in a statement issued by the ministry on Sunday.

The Minister stated that the funds will be allocated for the construction of substations for Lot 2 and substations and distribution lines for Lot 3, with $400 million designated for each.

Lot 2 covers the franchise areas of Benin, Port Harcourt, and Enugu Distribution Companies (DISCOs), while Lot 3 covers the franchise areas of Abuja, Kaduna, Jos, and Kano DISCOs.

The Minister was in China to attend the China-Africa Cooperation Summit.

According to the minister, on Friday, 30th August, generation peaked at 5,170 megawatts; however, it had to be reduced by 1,400 megawatts due to the DISCOs’ inability to take up the supply.

“This is truly regrettable, considering that the government is on course to increase generation to 6,000 megawatts by the end of the year,” he said.

During an interactive session with TBEA management, Adelabu also assured the federal government’s commitment to working with world-class organisations like TBEA to achieve President Bola Tinubu’s Renewed Hope vision for the power sector in Nigeria, particularly in the areas of transmission and distribution across the entire power sector value chain, as well as Nigeria’s renewable energy segment.

Speaking on the challenges in the power sector that have hindered industrial growth, the Minister noted that these issues are partly due to the fragility of the transmission and distribution infrastructure, which has become outdated and dilapidated.

“This has led to the historical epileptic supply of power to households, industries, and businesses,” he said.

He further highlighted that more than 59 percent of industries in Nigeria are off the grid.

“They do not consider the national grid reliable. As a result, many now operate their own captive, self-generated power.”

Adelabu emphasised that the administration of President Bola Ahmed Tinubu is determined to transform the power sector, noting that several initiatives have commenced that are gradually restoring confidence in the sector and among power sector consumers, particularly industries.

Reflecting on the government’s different initiatives, Adelabu recalled that in 1984, about 40 years ago, Nigeria was able to generate 2,000 megawatts, and it took over 35 years to add 2,000 megawatts.

“When this administration came in last year, we inherited around 4 gigawatts (4,000 megawatts) of power, but within a year, we achieved a milestone of 5,170 megawatts, adding about 1,000 megawatts of power within the first year. It may seem small, but compared to the country’s history, this is commendable.

“We plan to achieve 6,000 megawatts of power by the end of the year through a combination of hydroelectric power plants and gas-fired power plants. We are also targeting 30 gigawatts of power to be generated, transmitted, and distributed by 2030, with 30 percent of that being renewable energy.”

The Minister noted that the renewable energy segment would be sourced from a combination of hydroelectric power from small dams, solar energy, and wind farms from onshore and offshore winds.

On the construction of the super grid, the Minister stated that the national grid, in its present state, cannot support the vision for the power sector.

“If we assess the strength, capacity, and age of our existing network on the national grid, it is clear that it cannot adequately support our vision for the power sector. Hence, the need for the construction of the Western and Eastern super grids.

“Although we have been working on this since I assumed office, I can also confirm that the President fully supports this initiative because it will improve our transmission network, stabilise the grid, and expand the capacity and flexibility of the national grid.”

He added that TBEA is not new to Nigeria, noting that the company is currently working with the Omotosho Power Plant in Ondo State, owned by the Niger Delta Power Holding Company.

Hanjie also commended the Minister for the improvements in the power sector, as evidenced by the enhanced generation and transmission since his assumption of office.

Acknowledging the short-term goal of improving to 6 gigawatts by December 2024 and the target of 30 gigawatts by 2030, he stated that TBEA is willing to collaborate with the Nigerian government to achieve this vision and contribute to the ongoing power sector revolution in the country

The Federal Government is planning more investment in the distribution segment of the power sector. This investment will be in the region of $ 800 million.

The Minister of Power, Adebayo Adelabu, disclosed this in far-away China when he visited TBEA Southern Power Transmission and Distribution Industry in Beijing, China.

The projects which come under the Presidential Power Initiative will see to the reinforcement of many substations and distribution networks.

The Minister stated that the funds will be allocated for the construction of substations for Lot 2 and substations and distribution lines for Lot 3, with $400 million designated for each.

Lot 2 covers the franchise areas of Benin, Port Harcourt, and Enugu Distribution Companies (DISCOs), while Lot 3 covers the franchise areas of Abuja, Kaduna, Jos, and Kano DISCOs.

The Minister was in China to attend the China-Africa Cooperation Summit.

According to the minister, on Friday, 30th August, generation peaked at 5,170 megawatts; however, it had to be reduced by 1,400 megawatts due to the DISCOs’ inability to take up the supply.

“This is truly regrettable, considering that the government is on course to increase generation to 6,000 megawatts by the end of the year,” he said.

During an interactive session with TBEA management, Adelabu also assured the federal government’s commitment to working with world-class organisations like TBEA to achieve President Bola Tinubu’s Renewed Hope vision for the power sector in Nigeria, particularly in the areas of transmission and distribution across the entire power sector value chain, as well as Nigeria’s renewable energy segment.

Speaking on the challenges in the power sector that have hindered industrial growth, the Minister noted that these issues are partly due to the fragility of the transmission and distribution infrastructure, which has become outdated and dilapidated.

“This has led to the historical epileptic supply of power to households, industries, and businesses,” he said.

He further highlighted that more than 59 percent of industries in Nigeria are off the grid.

“They do not consider the national grid reliable. As a result, many now operate their own captive, self-generated power.”

Adelabu emphasised that the administration of President Bola Ahmed Tinubu is determined to transform the power sector, noting that several initiatives have commenced that are gradually restoring confidence in the sector and among power sector consumers, particularly industries.

Reflecting on the government’s different initiatives, Adelabu recalled that in 1984, about 40 years ago, Nigeria was able to generate 2,000 megawatts, and it took over 35 years to add 2,000 megawatts.

“When this administration came in last year, we inherited around 4 gigawatts (4,000 megawatts) of power, but within a year, we achieved a milestone of 5,170 megawatts, adding about 1,000 megawatts of power within the first year. It may seem small, but compared to the country’s history, this is commendable.

“We plan to achieve 6,000 megawatts of power by the end of the year through a combination of hydroelectric power plants and gas-fired power plants. We are also targeting 30 gigawatts of power to be generated, transmitted, and distributed by 2030, with 30 percent of that being renewable energy.”

The Minister noted that the renewable energy segment would be sourced from a combination of hydroelectric power from small dams, solar energy, and wind farms from onshore and offshore winds.

On the construction of the super grid, the Minister stated that the national grid, in its present state, cannot support the vision for the power sector.

“If we assess the strength, capacity, and age of our existing network on the national grid, it is clear that it cannot adequately support our vision for the power sector. Hence, the need for the construction of the Western and Eastern super grids.

“Although we have been working on this since I assumed office, I can also confirm that the President fully supports this initiative because it will improve our transmission network, stabilise the grid, and expand the capacity and flexibility of the national grid.”

He added that TBEA is not new to Nigeria, noting that the company is currently working with the Omotosho Power Plant in Ondo State, owned by the Niger Delta Power Holding Company.

Hanjie also commended the Minister for the improvements in the power sector, as evidenced by the enhanced generation and transmission since his assumption of office.

Acknowledging the short-term goal of improving to 6 gigawatts by December 2024 and the target of 30 gigawatts by 2030, he stated that TBEA is willing to collaborate with the Nigerian government to achieve this vision and contribute to the ongoing power sector revolution in the country