A Programme to modernise Nigeria’s electricity grid, under a Government-to-Government framework between the Nigerian and German Governments; to be managed and implemented by Siemens AG.
1. BEGINNING: The initiative was birthed from discussions
between the Nigerian and German Governments during
German Chancellor Angela Merkel’s State Visit in August
2. UNFOLDING: Initial development work on the foundational ‘Roadmap’ document (known as the Nigeria Electrification Roadmap) was done by Siemens, the Nigerian Government (Ministries, Departments and Agencies) and the 11 Electricity Distribution Companies (DisCos), between October 2018 and June 2019. [As part of this, the DisCos submitted lists of priority projects to be done in all three Phases of the PPI].
3. SIGNING: Signing of the Implementation Agreement for
the Roadmap took place on Monday July 22, 2019. The
Agreement was signed by Siemens and by the Bureau of
Public Enterprises (on behalf of the Nigerian Government),
and witnessed by shareholders and management of the
4. PHASES: The PPI will be implemented in three (3) Phases:
• Phase 1: Resolve 2,000MW of Transmission and Distribution Constraints, taking operational capacity of the grid to 7,000MW
• Phase 2: Increase operational Grid Capacity by an additional 4,000MW, to 11,000MW
• Phase 3: Achieve total operational Generation and Grid Capacity of 25,000MW subsequently
5. FOCUS: The PPI is focused more on critical interventions
in the Transmission and Distribution segments of the
Power Sector in Phases 1 and 2. Siemens will be working to
upgrade Assets belonging to the Transmission Company of
Nigeria (TCN) and the 11 Power Distribution Companies
6. PROJECTS: Phase 1 of the PPI comprises several individual
brownfield and greenfield transmission and distribution
upgrade and expansion projects that will be executed by Siemens and other Project Partners.
These include but are not limited to the following:
a. Transmission Projects: Supply and installation of
Transmission Substations, Mobile substations, Transformers, Compensation Systems, and Overhead
b. Distribution Projects: Upgrade/Expansion of existing
Distribution Substations. Supply and installation of power distribution products and systems. Installation and
commissioning of mobile substations, and power
c. Power System Simulation and Studies: Software licences and associated services for TCN and DisCos. Training and Technical Services for TCN and DisCos.
d. Control & Protection Devices: Supply of Control and Protection devices for TCN and DisCos.
e. Meter Data Management Systems: Deployment of
national Meter Data Management Infrastructure
(Hardware, Software, Services).
f. Technical Training: Extensive Training and Technical
support for TCN, DisCos and other relevant Power
7. FINANCING: Financing will be through the German Export
Credit Agency (Euler Hermes AG) and other financing
8. UPDATE (May 2020)
a. President Muhammadu Buhari has directed the
Ministries of Power and of Finance, Budget & National
Planning and the Bureau of Public Enterprise (‘BPE’) to
conclude the engagement with Siemens AG to commence the pre-engineering and concessionary financing workstreams of the PPI.
b. To recap, with the support of the German Government,
the Federal Government on behalf of the other
shareholders in the Electricity Distribution Companies
(‘DisCos’) will invest in significant infrastructure upgrades in the form of improved payment systems, distribution substations, transformers, protection devices, smart meters, transmission lines, amongst others.
c. The President has directed that to ensure value for
money and preserve the integrity and transparency of
the procurement process under the Government to Government framework, Siemens AG shall be solely responsible for nominating its EPC partners to perform all onshore works; NO middle-men.
d. All DisCos have directly, and through the BPE, been
diligently carried along over the last 15 months to understand in detail the challenges in the electricity
systems. All items to be purchased were provided by the DisCos and Transmission Company of Nigeria and they
will be vetted by a professional Project Management
e. The funding for the project will be secured under
concessionary terms (up to 3-year moratorium and 12-
year repayment at concessionary interest rates) through the German Euler Hermes cover, which the Federal Government will on-lend as a convertible loan to the
other shareholders in the DisCos.
f. Funding for the first part of Phase 1 has now been
approved by President Buhari to kick-off the preengineering and concessionary financing workstreams.
g. To ensure fairness and transparency of the intervention,
the President has also directed that Federal Government
engages the International Finance Corporation (‘IFC’) to
assist in developing the commercial structure of the
intervention under this Presidential Power Initiative (PPI) and in undertaking an independent company valuation of the DisCos.
a. Will deliver improved power supply nationwide, with
attendant results in job creation, investor confidence,
cost and ease of doing business and economic growth.
b. Will provide training and capacity building for thousands
of young Nigerians (non-graduates, students and
c. Will create economic opportunities for Nigerian
engineering companies that will serve as local vendors
for the provision of manpower and equipment.
d. Will stimulate/encourage inflow of additional investment
into the power sector
The PPI journey started on August 31, 2018, when Chancellor Angela Merkel visited Nigeria and met with President Buhari. She brought along with her a business delegation that included the Global CEO of Siemens, Mr Joe Kaeser. Nigeria and Germany agreed to explore cooperation in a number of areas, including Power. This set the stage for subsequent meetings.
“Our goal is simply to deliver electricity to Nigerian businesses and homes… Our intention is to ensure that our cooperation is structured under a Government-to-Government framework.
No middlemen will be involved, so that we can achieve value for money for Nigerians.” – President Muhammadu Buhari
I will personally oversee the implementation [of the Nigeria
Electrification Roadmap / Presidential Power Initiative] as this is a landmark project for Nigeria and Africa.” – Joe Kaeser,
Global CEO, Siemens AG