Grid Collapse: Lagos Opens Bids for Gas-Fired Power Plants

By Adedapo Adesanya

The Lagos State Government has invited bids for the construction of gas-fired power plants to tackle the state’s persistent electricity shortfall.

The initiative which was announced by the Ministry of Energy and Mineral Resources in partnership with the Office of Public-Private Partnerships this week, seeks to generate up to 500 megawatts (MW) of electricity across four designated hubs in the state.

This has been necessitated by the recent spate of grid collapses that have occurred about 10 times in 2024.

The Lagos state government disclosed that while it currently requires over 6,000 MW of electricity, the DisCos operating in the state supply less than 2,000 MW during peak periods.

“The state faces pressing energy challenges due to rapid urbanization and growth in economic activities. “There is an urgent need for sustainable alternatives to the supply of energy from the national grid, which is inadequate for the entire country,” a statement from the Ministry of Energy disclosed.

The government is welcoming bids from individual companies and consortia with the technical, financial, and legal expertise needed to deliver the project. In cases of consortium bids, one company must be identified as the lead partner.

The move is part of its Clean Lagos Electricity Market (CLEM) initiative, which is offering four hubs where the proposed gas-fired plants will be located.

According to the directive from MEMR, the power plants will be sited close to existing DisCos substations to optimize distribution, with a minimum required output of 100MW from participating companies.

Each hub is expected to generate up to 500MW to meet the growing energy needs of the state.

“This initiative is designed to close the gap between Lagos’ energy demand and supply, enabling the state to power its industrial, commercial, and residential needs more effectively,” the statement disclosed.

“The minimum intended generation capacity of electricity for each of the four hubs shall be 500MW, which one or more power-generating firms shall generate,” the statement also disclosed.

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

To ensure successful implementation, the project scope includes financing, engineering, construction, commissioning, and operation of the plants.

It also said companies must also arrange a constant supply of gas and other fuels for sustained operations.

“Generation of electricity of not less than 100MW for each of the allocated sites for the Clean Lagos State Electricity Market is a non-negotiable requirement.”