The Lagos State Government has taken a major step toward improving electricity supply with the signing of Power Purchase Agreements (PPAs) with three generation companies, targeting up to 400 megawatts of power within the next three years.
Governor Babajide Sanwo-Olu witnessed the signing ceremony at Lagos House, Marina, while the Commissioner for Energy and Mineral Resources, Abiodun Ogunleye, signed on behalf of the state.
The agreements involve Mainland Power Limited, Fenchurch Power Limited, and Viathan Engineering—three key operators among the independent power plants currently serving Lagos.
Speaking after the signing, Sanwo-Olu said the new agreements are designed to strengthen existing capacity while fixing inefficiencies in previous arrangements. He noted that the deals would ensure more reliable electricity supply to critical infrastructure across the state.
He explained that Fenchurch Power would support major water facilities in Adiyan and Iju, while Mainland Power would continue supplying electricity to areas such as Ikeja, Oshodi, and Anthony, with plans for expansion. Viathan Engineering, on its part, will sustain and improve power supply to key public facilities on Lagos Island.
The governor emphasised that the agreements have been restructured to reflect current realities in the energy market, particularly by linking payments strictly to actual electricity delivered.
“We will no longer pay for power that is not supplied. Payments are now tied to metered delivery, helping us reduce waste and manage costs more efficiently,” he said.
Providing further details, Ogunleye noted that the three companies currently generate about 60MW combined but have the capacity to scale up significantly—potentially reaching between 200MW and 400MW within two to three years through private investment.
He highlighted that Mainland Power operates the Ikeja GRA plant, supplying electricity to strategic facilities including the Lagos State University Teaching Hospital. Meanwhile, the Akute Independent Power Plant, now under Fenchurch Power, is being revived after years of inactivity and is expected to serve surrounding communities and critical infrastructure like the Adiyan Water Works.
On Lagos Island, Viathan Engineering will manage the Peninsula Integrated Power Project, delivering electricity to major government institutions and healthcare facilities, including the Government House, Lagos Island General Hospital, and the Lagos Island Maternity Hospital.
The state government said the agreements are part of a broader push to reform the electricity sector following the Lagos State Electricity Law enacted in 2024. The law aims to establish a more independent state power market, attract investment, and reduce reliance on the national grid.
Despite ongoing reforms, challenges such as transmission limitations, gas supply issues, and grid instability continue to affect power supply nationwide.
However, Lagos is positioning itself to overcome these obstacles through private-sector partnerships and long-term investments, with the goal of delivering more stable and reliable electricity to millions of residents.
