Lagos invites companies to bid for power plants to meet state’s electricity demand

The Lagos State Government has called on independent power producers and energy solutions companies to submit bids for the construction of gas-fired power plants aimed at addressing the persistent power shortage in the state.

The initiative, announced by the Ministry of Energy and Mineral Resources (MEMR) in partnership with the Office of Public Private Partnership (OPPP) on Wednesday, aims to generate up to 500 MW of power at four designated nodes in the state.

With a population of over 20 million, Lagos remains Africa’s largest metropolis and the economic center of Nigeria.

However, the city’s energy needs far exceed supplies from the national grid. The government said that while Lagos requires more than 6,000 MW of electricity, existing distribution companies supply less than 2,000 MW during peak periods.

“The state faces pressing energy challenges due to rapid urbanization and increasing economic activity. “There is an urgent need for sustainable alternatives to supplying energy from the national grid, which is insufficient for the entire country,” The statement was read in part.

Solving the problem of electricity shortages

Under the Clean Lagos Electricity Market (CLEM) initiative, the government is proposing four nodes where the proposed gas-fired power plants will be located.

According to the MEMR directive, the power plants will be located close to existing substations of distribution companies to optimize distribution, with a minimum required capacity of 100 MW of participating companies.
Each node is expected to generate up to 500 MW to meet the state’s growing energy needs.

“This initiative is designed to bridge the gap between energy supply and demand in Lagos, allowing the state to more effectively meet its industrial, commercial and residential needs.”“- added in the statement.

Increasing energy security

The Lagos State Government is positioning this project as a critical step towards achieving energy security and reducing dependence on Grid 6.

“The minimum estimated electricity generation capacity for each of the four hubs should be 500 MW, which should be generated by one or more power generating companies,” the ad says.

The government also emphasized its commitment to supporting investors in the project.

“Lagos provides an enabling environment for private sector investment in the energy sector and we are confident that this project will attract leading companies capable of delivering world-class solutions.“- it said.

To ensure successful implementation, the project scope includes financing, design, construction, commissioning and operation of the plants. Companies must also arrange for a constant supply of gas and other fuels to operate sustainably.

“Power generation of at least 100 MW for each of the allocated sites for the Clean Lagos State Electricity Market” is an indispensable requirement.

Who can apply?

The government welcomes applications from both individual companies and consortia with the technical, financial and legal expertise needed to implement the project. For consortium applications, one company must be designated as the lead partner.

“The parent company will have primary responsibility for ensuring the successful implementation of the project,” emphasized in the statement.

It was further specified “Members of the consortium must jointly submit an application and indicate their specialized experience. This collaboration will allow us to bring the right combination of expertise and innovation to deliver this critical infrastructure.”

Interested parties are encouraged to visit www.ppplagos.lagosstate.gov.ng or contact us at [email protected] for detailed application instructions.

“Our goal is to create a reliable energy system that meets the needs of our growing population while positioning Lagos as a leader in sustainable energy solutions,” the government concluded.

What you should know

Lagos State, Nigeria’s most populous state, is home to more than 20 million people. It also accounts for the highest electricity consumption in the country due to its significant commercial and economic activities.

Recent Report reveals that businesses in Lagos consume about 6.6 billion liters of petrol annually, resulting in carbon dioxide emissions estimated at 17.8 million tonnes of carbon equivalent.
This high dependence on petrol is largely due to inadequate electricity supply from the national grid.

The planned construction of power plants aims to achieve energy sufficiency in Lagos by reducing its heavy dependence on a limited and unreliable power grid.