LAGOS SEALS THREE POWER PURCHASE AGREEMENTS WITH IPPS
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By: Balogun Ibrahim
The Lagos State Government on Sunday signed three Power Purchase Agreements with Independent Power Producers (IPPs) as part of efforts to boost embedded electricity generation and enhance power supply to key public infrastructure.
The agreements, formalised at Lagos House in Marina, involve Fenchurch Power, Mainland Power, and Viathan Engineering Limited, marking a shift toward a more competitive and market-oriented electricity system in the state.
Speaking at the event, the Commissioner for Energy and Mineral Resources, Biodun Ogunleye, said the deals cover three of the four IPPs previously engaged by the state and represent a restructuring of Lagos’ embedded power framework. He explained that Fenchurch Power would supply electricity to major water facilities in Adiyan and Iju, while Mainland Power’s renewed contract would expand service to areas such as Ikeja, Ikeja GRA, Oshodi, and Anthony.
He added that Viathan’s operations are being integrated into a broader network in collaboration with Eko Disco, ensuring consistent premium power supply to critical facilities.
Ogunleye noted that the agreements have been redesigned to reflect current market realities and support decentralised power generation. A key feature of the new framework is the removal of outdated payment models, ensuring that the government only pays for electricity actually supplied, based on metered usage.
He also highlighted efforts to strengthen infrastructure reliability by creating alternative power sources for essential facilities, reducing dependence on single suppliers.
Looking ahead, he projected a significant increase in generation capacity—from less than 60 megawatts currently to between 200 and 400 megawatts within the next two to three years—driven by competitive market participation rather than direct government funding.
Governor Babajide Sanwo-Olu, who witnessed the signing, said the agreements aim to build on existing capacity while addressing inefficiencies in previous arrangements. He emphasized that payments would now be tied strictly to delivered power, improving accountability and reducing waste.
Sanwo-Olu explained that Fenchurch Power would support water infrastructure projects, Mainland Power would continue and expand supply across key mainland areas, and Viathan would maintain stable electricity supply to facilities on Lagos Island.
He added that the reforms are expected to improve service delivery, optimise public spending, and strengthen the resilience of the state’s infrastructure.
Under the new agreements, Mainland Power will continue supplying electricity to areas including Ikeja, Oshodi, and Anthony under a renewed 10-year deal, while the Akute Independent Power Plant operated by Fenchurch is being revived to support water projects. Viathan’s Island Power and Peninsula Integrated Power Project will continue powering key government facilities using hybrid systems.
Overall, the initiative forms part of Lagos State’s broader plan to decentralise electricity generation, enhance reliability, and ensure sustainable power supply across critical public assets.
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