In the last 12 months Nigeria’s electricity sector has been transformed with the arrival of Minister Babatunde Fashola, Minister for Power, Works and Housing, who has set out clearly his intention to break down the barriers to investment in the country’s energy sector. Following President Buhari’s lead to tackle bottlenecks and inefficiencies the Minister has embarked on a strategy to get the distribution companies working, providing support and regular interactions with the privately held companies that have worked tirelessly to build the electricity backbone of Nigeria.
It’s now been proven that IPPs are possible with multilateral, international and local banks uniting to deliver what could be perceived as some of the most exciting projects on to the continent. However, it is clear that now is not the time for celebration, now is the time for action and to focus on the next phases such as gas infrastructure, diversifying the energy mix, renewables, energy tariffs, micro grids and off the grid energy, as well as the clear need for billions of dollars of investment in the transmission and distribution networks.
Nigeria’s Economy Leading the Way in Africa
Nigeria is currently positioned as the largest economy in Africa and is poised to become the largest market in Africa for IPP projects. As the country aims to increase total installed capacity to 20,000MW by 2020 and with the unbundling of the oil and gas sector, and privatisation of the power sector underway, new generation capacity is going to rely solely on private sector investment. Government, public sector institutions, investors and power producers all come together to set a new precedent for African power driven by commercial capital and a commitment to the economic value of power generation.