COP28: Nigeria, Siemens sign power infrastructure agreement

Nigeria and Germany have agreed to add 12,000 mw of electricity to the national grid through the Presidential Power Initiative (PPI).

The Power initiative, which will be financed by the Government export credit facility currently offered to Nigeria by a few German banks, would cost around $60 million and will include the procurement of 10 transformers and 10 power mobile stations.

President Bola Ahmed Tinubu and German Chancellor Olaf Scholz both presided over the signing on Friday in Dubai, United Arab Emirates (UAE), on the margins of the United Nations Climate Conference (COP28) at Expo City.

According to a report by the Voice of Nigeria, Kenny Anue, Managing Director of the Federal Government of Nigeria Power Company, signed on behalf of Nigeria, while Nadja Haakansson, Managing Director (Africa) Siemens AG, signed for Siemens.

Anue reaffirmed President Tinubu’s commitment to the development of electricity infrastructure in Nigeria, stressing that he had reiterated that infrastructure development is crucial to the ongoing reforms.

He also stated that electricity and financing are at the heart of the administration’s economic reform agenda, and that the PPI, by design, encapsulates both elements with the support of partners, Siemens Energy and financiers backed by the German government.

Addressing the President, Anue noted: “Mr President, with your strong and dynamic leadership through the Honorable Minister of power, now we seek to exploit or expedite what was already a worthwhile program in the presidential power initiative through this accelerated agreement today.

“Some of the things that have been achieved, erstwhile by the federal government, have been the establishment of the FGN Power Company as the special purpose vehicle for the implementation of the project.”

Joe Kaeser, Chairman of the Siemens Energy Supervisory Board, traced the history of the first agreement to the Muhammadu Buhari government in 2018, expressing joy that both sides are now able to carry the process ahead.

“I’m particularly happy to be here tonight to witness the signing of the Presidential Initiative for Power because in 2018 former President Buhari wanted me to come to Abuja and explain to him what we did in Egypt.

“And I said Mr. President, Egypt has 80 million (people) and we could use 14 gigawatts and Nigeria has 200 million people. So, we could need more gigawatts.

“Now, after five years, I’m really happy that this agreement has the spirit of supplying energy to the greater good of Nigerian people has been taken to a new level. Thank you very much for doing that. And as we say in Germany, good things take time as we have seen tonight.”

Speaking on the project, Adebayo Adelabu, Minister of Power, stated that the PPI’s goal is to add 12,000MW of electricity to the national grid.

He stated that with the signing on Friday, the process will now move forward to ensure that Nigerians have a steady supply of electricity.

“Of course, we knew that there were a lot of delays between 2018 and now that we have not made a significant achievement in terms of proceeding with the contract signed in 2018 because of a lot of factors some were natural, some human, some were processes.

“We also had COVID in 2020 which made the execution of the project slow. But now, it shows that we are now ready to move forward with the Siemens projects.

“It shows a commitment between the governments of both countries to proceed with this project, which we believe will go a long way in improving the performance of the power sector in Nigeria.
“This is an agreement that has to do with end-to-end fixing in terms of grid stabilisation of the entire transmission grid in the Nigerian power sector, which will eventually improve the power supply in terms of regularity, in terms of functionality and terms of affordability in the years to come.

“We’re delighted that we can sign this agreement tonight. And in the next couple of months, we will witness a lot of activities on the presidential power initiatives project.”