Nigeria In Talks With China’s Exim Bank For $2 Billion Super Grid To Fix Power Supply Woes

The Federal Government is in advanced negotiations with China’s Export-Import Bank for a $2 billion loan to finance a new electricity super grid aimed at resolving Nigeria’s persistent power supply challenges.

According to a Bloomberg report, the proposed project will strengthen power transmission across the eastern and western regions with key industrial hubs of the country.

Minister of Power, Adebayo Adelabu, revealed the plan at an economic summit in Abuja on Monday, describing it as part of a broader effort to decentralise power generation and lure heavy energy users back to the national grid.

“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.

He added that negotiations with China’s Exim Bank were progressing well and that the financing arrangement had already received cabinet approval.

Nigeria’s electricity generation capacity stands at around 13 gigawatts, though only about one-third of that reaches consumers due to frequent system collapses and transmission bottlenecks. In comparison, South Africa with roughly one-quarter of Nigeria’s population boasts 70 gigawatts of installed capacity.

The unreliable power supply has forced many companies to rely on self-generation, which now accounts for nearly half of the country’s total electricity consumption.

Adelabu stated that the new super grid would boost power flow to industrial zones, spur manufacturing, and improve grid reliability.

Since President Bola Tinubu took office in 2023, his administration has rolled out several reforms to attract investment, including fuel subsidy removal, tax restructuring, and enhanced security in oil-producing regions.

Tinubu’s government also approved electricity tariff adjustments for urban consumers to improve the financial sustainability of the power sector, a move that reportedly led to a 70% increase in distribution company revenues in 2024, with projections reaching ₦2.4 trillion ($1.6 billion) in 2025.