ower Sector Reforms: FEC Sanctions N13 Billion Compensation, $34 Million for Transformers

Four important changes have been authorized by the Federal Executive Council (FEC) with the goal of bolstering Nigeria’s national electrical system and resolving the issues facing the power industry there.
The government’s increased efforts to update transmission infrastructure, increase supply reliability, and satisfy the country’s growing demand for power include the permission, which was announced on Wednesday.
Adebayo Adelabu, the Minister of Power, reportedly made the announcement following the FEC meeting, which was chaired by President Bola Tinubu.
The payment of ₦13 billion for compensation associated with the Lagos Industrial Transmission Project was the first significant clearance.

This project is a component of a larger plan to update the transmission infrastructure in Lagos and the industrial centers nearby.

According to Adelabu, the project aims to improve electricity supply to important industrial clusters in Lagos and is financed by a $238 million development credit from the Japan International Cooperation Agency (JICA).

“This funding covers compensation to communities and property owners impacted by the route of the transmission lines,” Adelabu stated.

“Our industrial estates will have the dedicated, reliable power they require to spur economic growth and job creation once the Lagos Industrial Transmission Project is finished.”

New National Grid High-Capacity Transformers
The FEC approved three more measures aimed at enhancing Nigeria’s power supply infrastructure in addition to the compensation approval.

These include replacing the outdated, overloaded, and weak transformers that are currently on the national system with high-capacity transformers.

The $34 million purchase would be augmented by ₦5.2 billion to cover related expenses. Included in the package are:

150MVA 330/132kV transformers in two units
Three pieces of 132/33kV, 100MVA transformers
A total of five 60MVA 132/33kV transformer units
Two transformer units with 30MVA 132/33kV
“To relieve overloaded facilities, improve voltage stability, and accommodate the increased transmission capacity we are building, these transformers will be strategically deployed across the grid,” Adelabu said.

The Minister characterized Nigeria’s national grid as aging, pointing out that many of its parts—like cables and transformers—had been in use for more than 50 years and were now over their designated lifespan.

Adelabu admitted that “a lot of the transformers, cables, and related components are weak and prone to failure.”

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“To achieve a stable, dependable, and efficient grid that meets the needs of households, offices, small businesses, and industries, regular maintenance and timely replacement are essential.”

He emphasized that the new measures were a component of the Tinubu administration’s larger plan to increase access to energy, remove transmission bottlenecks, and lessen system failures in order to lay the groundwork for long-term economic growth.

According to reports, the most recent reforms are thought to be a big step toward solving Nigeria’s problems with the power sector.

It is anticipated that the improvements will not only solve the current grid stability issues but also lay the groundwork for Nigeria’s long-term economic goals by providing dependable access to power for all economic sectors.

Adelabu emphasized that the private sector is anticipated to be crucial in carrying out these reforms, and that the government’s objective is to make sure the power industry becomes a major engine of economic growth and employment creation.