The Federal Government of Nigeria has initiated a regulatory review of the $1.3bn Zungeru Hydropower Project in Niger State. The 700-megawatt plant currently supplies about half of its installed capacity to the national grid. This move is part of efforts to optimize the performance of the plant, which is operated under a Public-Private Partnership arrangement. The Infrastructure Concession Regulatory Commission (ICRC) disclosed this after convening a stakeholders' meeting in Abuja.
The stakeholders' meeting involved the Federal Ministry of Power, the Federal Ministry of Water Resources and Sanitation, the Bureau of Public Enterprises, and Penstock Limited, the concessionaire operating the project. The meeting aimed to identify and resolve legal and operational issues limiting the plant's performance. The ICRC stated that it had stepped up oversight of the project to ensure it delivers more electricity to the national grid. This is crucial as the Federal Government seeks to increase power supply and address persistent electricity shortages.
The Zungeru Hydropower Project, located on the Kaduna River in Niger State, is one of Nigeria's major hydropower investments. It has an installed capacity of 700MW and was developed at an estimated cost of $1.3bn. The project comprises four generating units and was designed to provide substantial additional electricity to the grid. Its performance is significant to efforts to increase Nigeria's available generation capacity, particularly as the country continues to grapple with inadequate power supply.
The ICRC's intervention is not aimed at taking over the agreement but at ensuring that both parties comply with their obligations. The Director-General of the ICRC, Jobson Oseodion Ewalefoh, explained that the commission was established under the ICRC Act 2005 to regulate PPP arrangements and monitor compliance with concession agreements. He emphasized that the commission's duty is to ensure sustainability, return on investment, and value for money in the interest of the Nigerian people.
Ewalefoh said the meeting was convened to identify factors preventing Zungeru from operating optimally and determine how they could be addressed. He noted that President Bola Ahmed Tinubu's promise to solve the power problem is not just words, but a statement he meant, and that all stakeholders must play their roles to deliver on this promise. The ICRC's intervention would extend beyond Zungeru, with similar compliance reviews planned for other power plants operated under PPP arrangements.
The ICRC said its review process would culminate in measures aimed at improving the performance of the plant and ensuring that the investment delivers greater value to Nigerians. The stakeholders itemized the legal and operational issues affecting the Zungeru project and agreed on a date to reconvene and continue discussions. This move comes against the backdrop of the Federal Government's renewed focus on improving electricity supply by extracting greater output from existing infrastructure.
President Tinubu's 2026 Democracy Day address emphasized the importance of ensuring that public assets and PPP investments deliver the services for which they were established. The ICRC will work with the Ministry of Power and other stakeholders to ensure that PPP power projects operate efficiently. The commission will continue reviewing existing PPP arrangements because improved efficiency is one of the main reasons government assets were transferred to private operators.
Key points
- The Federal Government has begun a regulatory review of the $1.3bn Zungeru Hydropower Project.
- The plant currently supplies about 350 megawatts to the National Grid, half of its installed capacity.
- The ICRC's intervention aims to optimize the performance of the plant and ensure it delivers more electricity to the national grid.
