Lagos State: Electricity Law 2024 Review to Assess Private Power Investment

• The Lagos State Government will review private investment in its electricity market in November, assessing the 2024 Electricity Law.
• The second Lagos Energy Summit, scheduled for November 10-11, 2026, will focus on the law's implementation and private sector participation.
• Several private power projects are underway, including Fenchurch Power's 26MW Akute IPP rebuild and Elektron Energy's 40MW Victoria Island project.
• The state aims to increase electricity generation from under 60MW to 200-400MW within two to three years through new arrangements.
• The Lagos State Electricity Regulatory Commission approved 14 licenses in May for various decentralized power initiatives.

The summit will serve as a key platform to scrutinize the implementation of the 2024 electricity law, particularly its effects on private sector engagement and capital deployment across the entire electricity value chain.

The Lagos State Government is set to conduct a comprehensive review of private investment opportunities and private sector involvement within its electricity market this November. This assessment will specifically evaluate developments and outcomes stemming from the Lagos State Electricity Law, which was enacted in 2024. The Ministry of Energy and Mineral Resources formally announced this upcoming review in anticipation of the second Lagos Energy Summit.

Scheduled for November 10 and 11, 2026, in Victoria Island, the summit will serve as a key platform to scrutinize the implementation of the 2024 electricity law, particularly its effects on private sector engagement and capital deployment across the entire electricity value chain. This significant review comes at a time when numerous private power projects are actively progressing through various stages of licensing, construction, and development throughout Lagos, while other prospective initiatives remain under regulatory examination.

The 2026 Lagos Energy Summit is poised to thoroughly examine the evolving regulatory framework governing the state's power sector, with a primary objective of determining how it can best support the establishment of a reliable and sustainable electricity market. Key discussion points anticipated at the summit include renewable energy solutions, critical electricity infrastructure, and the expansion of decentralised generation capabilities.

Biodun Ogunleye, the Commissioner for Energy and Mineral Resources, stated that the summit's agenda encompasses an evaluation of the progress achieved since the Lagos State Electricity Law came into effect. Furthermore, he highlighted that the event aims to foster strategic partnerships and investments designed to deliver measurable outcomes across the generation, transmission, and distribution segments of the power sector. The summit's original September scheduling was adjusted to November to allow for more extensive preparations.

The forthcoming discussions on investment coincide with a period of active development by private operators across Lagos, who are establishing new power projects and securing supply arrangements. A prominent example is Fenchurch Power Limited's 26-megawatt (MW) reconstruction of the Akute Independent Power Plant (IPP), which is being delivered through a concession agreement with the Lagos State Government. This project is specifically designed to provide dedicated electricity to the Akute Intake, Iju Waterworks, and Adiyan Waterworks, with any surplus power directed to the network of Ikeja Electric.

Site work for the Fenchurch project commenced in September, involving the replacement of existing engines with new MWM gas engines. Ten megawatts are anticipated to become operational within four months, with the remaining 16 MW expected online within 12 months. The Akute initiative forms part of broader power supply arrangements signed by the Lagos State Government in April with Mainland Power, Fenchurch Power, and Viathan Engineering. These arrangements collectively aim to increase Lagos's electricity generation from less than 60 MW to between 200 MW and 400 MW over the next two to three years.

Beyond these larger independent power plants, private sector participation is also expanding into off-grid generation, embedded generation, private distribution networks, and mini-grids, contributing to a growing Nigeria decentralised power market. In September, Elektron Energy Development received an operational license for its 40 MW Victoria Island Power project, which is slated to commence commercial operations in December, supplying businesses through a dedicated distribution network. Concurrently, Sahara Power Enterprises Group initiated construction in August on a 12 MW independent power plant in Ogba, representing a $12 million investment, with completion targeted for the first quarter of 2027.

Further underscoring this trend, the Lagos State Electricity Regulatory Commission (LASERC) approved 14 licenses and permits in May. These approvals encompassed various areas, including off-grid generation, embedded generation, independent electricity distribution, metering services, and interconnected mini-grids, reflecting the diverse and expanding nature of private participation in the Lagos electricity market regulation.

Lawyers advising clients on energy investments or power project development in Lagos should closely monitor the outcomes of the 2026 Lagos Energy Summit. Discussions on the Lagos State Electricity Law 2024 implementation may lead to clarifications or amendments impacting regulatory compliance, licensing, and investment frameworks for private sector participation.

Source: Original reporting via Nairametrics