Lagos secures decentralised power delivery with new PPA agreements

Lagos State Government has taken a decisive step toward strengthening its power infrastructure with the execution of Power Purchase Agreements (PPAs) with three Independent Power Purchase (IPPs) operators; Mainland Power Limited, Fenchurch Nigeria Limited, and Viathan Engineering Limited.

The agreements were formalised at Lagos House, Marina, in the presence of Governor Babajide Sanwo-Olu.

Facilitated by the Office of Public-Private Partnerships, in collaboration with the Ministry of Energy and Mineral Resources, the signing highlights the State’s deliberate use of public-private partnerships to deliver power more efficiently, structuring projects that bring supply closer to demand, strengthen infrastructure and services, and combine public oversight with private sector capital and expertise.

A key component of the agreements is the concession of the Akute Independent Power Plant to Fenchurch Power Limited. The plant, which has remained dormant for five years, will undergo full rehabilitation and expansion under a 25-year concession, renewable subject to performance.

The scope includes the upgrade of the existing 12.15MW capacity and an additional 14MW through the deployment of seven 2MW gas engines, bringing total contracted capacity to about 26MW. Upon completion, the facility is expected to meet the Lagos State Water Corporation’s peak demand of 18.7MW, power the upgraded Adiyan Water Works, and serve surrounding communities.

The State also renewed its PPA with Mainland Power Limited for the Ikeja corridor, securing continued electricity supply to key government infrastructure over a 10-year period.

The plant, with an installed capacity of up to 8.8MW and a contracted capacity of 5.8MW, will deliver a minimum annual supply of 6,000,000 kWh, supporting essential public services including healthcare facilities, regulatory institutions, and street lighting networks.

In Lagos Island, Viathan Engineering Limited will continue operations under the Island Power Limited / Peninsula Integrated Power Project. With a combined installed capacity of 21MW across Lekki and Marina, the project utilises hybrid and dual-fuel systems to provide reliable electricity to critical government facilities, including the State House, the Deputy Governor’s Residence, major healthcare institutions, and strategic commercial hubs.

Together, the signing of the PPAs shows Lagos State’s continued commitment to sustainable energy, through carefully structured partnerships that unlock private capital and expertise, while minimising public sector risk.

Speaking on the development, Bukola Odoe, the Special Adviser on Public-Private Partnerships,  said “These agreements highlight Lagos State’s continued reliance on PPPs to deliver critical infrastructure in a sustainable way. We are focused on delivering projects that perform, protect the State’s interests, and improve how essential services are delivered to over 24 million people who call Lagos their home.”

The Office of Public-Private Partnerships Lagos remains committed to developing transparent, investment-ready partnerships that support infrastructure growth and deliver long-term value to the people of Lagos State.