Nigeria is currently engaging in talks with the Export-Import Bank of China for a $2 billion loan that will bring used in the financing of a new super grid. This proposed Nigeria’s Super Grid is intended to address the nation’s persistent power shortages. Furthermore, the plan which was confirmed yesterday in Abuja by Minister of Power Adebayo Adelabu. It is designed to boost the country’s electricity supply and cut power outages.
“It is part of plans to decentralize power generation in Nigeria” and get the heavy commercial users that left the power grid because of its unreliability to return, he said.
Nigeria’s Super Grid Factsheet
Project name: National “Super Grid” Construction
Project type: Electricity Transmission Infrastructure Upgrade and Expansion
Cost: $2 Billion
Proposed funding source: Loan from the Export-Import Bank of China (China Eximbank)
Primary objective: Stabilize and decentralize electricity supply, reduce power outages, and revive industrial production.
Key function: To link the eastern and western regions of the country with new transmission infrastructure
Strategic goal: To encourage large-scale industrial consumers—many of whom currently self-generate power due to unreliability—to reconnect to the federal network by providing reliable, affordable electricity.
Furthermore, the loan is designated for the construction of a super grid. Also, the new power line is expected to decentralize electricity generation. It will also increase electricity supply to industrial zones that are located in both eastern and western Nigeria.
Other Efforts by the Federal Government in Bid to Increase Power Supply
The loan is part of a broader strategy by President Bola Tinubu’s administration to transform the power sector. Additionally, other recent efforts include by the administration include: securing $1.1 billion from the African Development Bank (AfDB) for electricity access; acquiring $70 million from the International Finance Corporation (IFC) for mini-grid projects; sealing a $328.8 million deal with a Chinese firm, CMEC, to improve electricity transmission infrastructure. Also, the country decided to upgrade its power grid in order to boost power supply capacity.
Other MoUs in Power Generation Investments
Also, in October 2023, the Federal Government had signed a $2 billion Memorandum of Understanding (MoU) with three Chinese firms. These firms were required to invest in the power generation and digital economy sectors in Nigeria.
However, there have also been other, unrelated agreements for maritime investment and other infrastructure projects that have been mistaken for the recent power loan.
Lastly, in late 2024, China and Nigeria renewed a separate $2 billion currency-swap arrangement to boost trade and investment between the two nations.
