Nigeria is in advanced talks with the Export-Import Bank of China (EximBank) for a $2 billion loan to finance the construction of a new “super grid” transmission network, aimed at addressing decades of unreliable electricity and frequent blackouts.
Minister of Power Adebayo Adelabu confirmed the development during an economic summit in Abuja, explaining that the grid will connect Nigeria’s eastern and western regions, where a significant portion of industrial activity is concentrated.
“It is part of the government’s plan to decentralise power generation and encourage large-scale commercial users, who exited the national grid due to its unreliability, to return,” Adelabu said.
Nigeria’s energy crisis remains one of the country’s most pressing constraints on economic growth. Despite an installed generation capacity of about 13 gigawatts, the national grid delivers barely 4 gigawatts to over 200 million citizens.
Frequent blackouts and outdated infrastructure have forced many factories, businesses, and households to rely on self-generated power from diesel and gas generators, raising operational costs, constraining productivity, inflating prices, and weakening competitiveness in manufacturing.
By comparison, South Africa, with roughly a quarter of Nigeria’s population, has an installed capacity of about 70 gigawatts, highlighting the vast energy gap limiting Nigeria’s industrial sector.
The proposed super grid is expected to enhance transmission efficiency, improve reliability, and deliver greater power to key industrial zones.
Minister Adelabu confirmed that the Federal Executive Council has already approved the project’s financing framework.
The $2 billion EximBank loan forms part of President Bola Tinubu’s broader economic and energy reform strategy to attract foreign investment and position Nigeria as a major player in Africa’s power market.
It also reflects China’s expanding role in financing major infrastructure projects across the continent.
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Beyond EximBank, Nigeria has secured $1.1 billion from the African Development Bank (AfDB) to expand electricity access, $70 million from the International Finance Corporation (IFC) for mini-grid development, and $328.8 million from Chinese firm CMEC to upgrade transmission infrastructure.
In October 2023, the government signed a $2 billion Memorandum of Understanding with three Chinese firms to invest in power generation and digital economy projects, while also renewing a $2 billion currency-swap agreement with China in late 2024 to strengthen trade and investment ties.
Adelabu’s team told Bloomberg that discussions with EximBank are ongoing and “progressing positively.”
The minister noted that recent tariff adjustments for urban consumers have improved the financial sustainability of the electricity sector, with industry revenues rising 70 percent in 2024 and projected to increase another 41 percent in 2025, reaching ₦2.4 trillion ($1.6 billion).
“These changes will enable power firms to reinvest in infrastructure, expand access, and improve reliability,” Adelabu said.
The tariff reforms, though controversial, aim to establish a cost-reflective pricing system capable of attracting long-term investment.
The super grid initiative aligns with President Tinubu’s wider economic reforms, including the removal of fuel subsidies, tax law overhauls, and enhanced security in oil-producing regions to boost crude output.
Since assuming office in 2023, Tinubu has prioritised energy reform to support industrialisation and job creation.
Despite ongoing interventions, Nigeria’s national grid remains unstable. Data from the Nigerian Electricity Regulatory Commission (NERC) recorded multiple partial and total collapses in 2024, including two nationwide blackouts.
Adelabu said the super grid would deploy advanced transmission technology to increase capacity and reduce system failures.
Nigeria’s energy reform efforts also have regional implications. The development of a super grid could stabilise domestic supply while enabling the country to export power to neighbouring states through the West African Power Pool (WAPP), advancing regional energy integration.
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