KEY POINTS
- Lagos signed power agreements with three firms to improve electricity supply to critical infrastructure.
- Each company will power specific locations, including water facilities and key urban areas.
- The state introduced a pay-for-performance model and is building on its 2024 electricity reform law to expand capacity.
The Lagos State Government has signed fresh power purchase agreements with three energy companies as part of efforts to improve electricity supply across critical public infrastructure in the state.
The agreements, finalised on Sunday at Lagos House in Marina, were announced by Governor Babajide Sanwo-Olu, who said the move is aimed at strengthening existing capacity and fixing long-standing inefficiencies in the power sector.
A major highlight of the agreements is the introduction of a performance-based payment structure. The state government will now only pay for electricity actually delivered.
Sanwo-Olu explained that payments are tied strictly to metered supply, a move expected to reduce financial waste, improve accountability, and ensure better value for public funds.
Building on Lagos Electricity Reform Law
The new agreements build on the Lagos Electricity Bill 2024, signed into law in December 2024. The legislation was introduced to tackle persistent challenges in the power sector and establish a more reliable electricity framework for Africa’s largest city economy.
The law is expected to create an additional power grid for Lagos and significantly reduce the frequency of blackouts, while supporting economic growth and industrial productivity.
Sanwo-Olu noted that beyond immediate improvements, the agreements provide a long-term roadmap for scaling electricity capacity in Lagos over the next few years.
He added that the initiative will not only stabilise power supply to public infrastructure but also enhance resource management and support the state’s broader development agenda.
