• Nigeria is negotiating a $2 billion loan from China Eximbank to build a national “super grid.”

• The project aims to stabilize electricity supply and revive industrial production.

• Over 200 companies now self-generate power, highlighting deep inefficiencies in the national grid.

Nigeria is negotiating a $2 billion loan with the Export-Import Bank of China (China Eximbank) to finance the construction of a national “super grid,” Energy Minister Adebayo Adelabu announced on Monday, October 6. The investment is meant to fix long-standing energy imbalances that have slowed economic growth and industrial activity for years.

Already approved by the government, the project is part of efforts to ensure a stable electricity supply—an essential condition for reviving the country’s manufacturing sector. The future grid will connect Nigeria’s eastern and western regions, the industrial heart of the country where most major companies are based.

Among them, Dangote Industries highlights the paradox of the current system. The conglomerate, whose cement plants are among the country’s largest energy consumers, operates its own power generation capacity of more than 1,500 MW. Like Dangote, over 200 companies and institutions now produce their own electricity through thermal or solar plants. These so-called captive power facilities generate more than 6,500 MW—greater than the national grid’s effective output, estimated between 4,500 and 5,000 MW.

This widespread shift to self-generation reflects the private sector’s loss of confidence in the national system. The new “super grid” aims to reverse this trend by providing more reliable and affordable electricity, encouraging industries to reconnect to the federal network.

According to the International Energy Agency (IEA), 86 million Nigerians still lacked access to electricity in 2022, making the country the world’s largest energy access deficit.

With an installed capacity of around 13 GW—only a fraction of which reaches consumers—Nigeria remains far behind regional peers. South Africa, with a population four times smaller, operates nearly 70 GW.

Since 2023, the Tinubu administration has introduced several reforms to revive the sector, including the removal of fuel subsidies and the adjustment of electricity tariffs. These measures helped boost power company revenues by 70% in 2024, with a further 41% increase expected this year, reaching $1.6 billion.