Olamilekan Abayomi
Governor Babajide Sanwo-Olu has signed a landmark Power Purchase Agreement with three independent electricity generation companies to boost supply in Lagos, targeting an additional 400MW for the state. The deal was signed Sunday at Lagos House, Marina, with Commissioner for Energy and Mineral Resources Abiodun Ogunleye representing the state. The partners are Mainland Power Limited, Akute Independent Power Plant, and Fenchurch Power Limited, a new entrant to Lagos’ IPP network.
Sanwo-Olu called the PPA “people-focused” and aimed at solving power problems by improving quality of life through reliable supply. He urged all sides to keep promises: “When people benefit, life becomes easier. This marks the beginning of the reforms we are seeing in the energy sector”. The agreement is part of Lagos’ push to reduce dependence on the national grid and expand distributed generation within the state.
Building on the Lagos Electricity Law 2024
This PPA follows Sanwo-Olu’s signing of the Lagos State Electricity Bill 2024 into law, which he described as a “watershed in the production and distribution of electricity” for Lagos. The law creates a Lagos Electricity Market and establishes key institutions: Lagos State Electricity Regulatory Commission for licensing/oversight, Lagos Independent System Operator for grid reliability, and Lagos State Electrification Agency to expand access to underserved communities. Implementation was slated to start within six months of federal approval.
Why Lagos is doing this
The Electricity Act 2023 gave states authority to generate, transmit, and distribute electricity. Lagos moved quickly to take control of its power supply and distribution. The law’s objectives include technically sound and financially viable markets, affordable/reliable/sustainable electricity for all citizens, and promoting renewable energy, investment, and competition. Sanwo-Olu said it will address power problems and tackle insecurity by lighting up the state.
The 24-hour power ambition
At the bill signing, Sanwo-Olu framed it as “a major step by the State Government, to ensure 24 hours electricity supply to every nook and cranny of the State”. The PPA with Mainland, Akute, and Fenchurch is one of the first commercial steps to deliver that. The law replaces the Lagos State Power Sector Reform Law of 2018 and aligns with the federal move allowing states to run their own markets. 803e
What the new market structure looks like
The Lagos Electricity Law 2024 provides for creation and administration of a Lagos electricity market that is technically sound and financially viable. It sets up independent oversight through the Lagos State Electricity Regulatory Commission, operational efficiency via the ISO, and rural/underserved expansion through the Electrification Agency. There’s also a Host Community Development Trust Fund to let communities develop power plants.
Renewables and off-grid partnerships
Beyond thermal IPPs, Lagos has been signing MoUs to expand clean energy. In 2024 Sanwo-Olu reaffirmed commitment to renewable energy and signed an MoU with the Rural Electrification Agency to target unstable supply. An earlier 4-year MoU with UK-funded Africa Clean Energy Technical Assistance Facility supports off-grid solar, policy, and capacity building. The governor said energy access is a “key pillar for economic growth and improved quality of life.
Immediate impact and rollout
Commissioner Biodun Ogunleye said implementation of the Electricity Law was scheduled to commence within six months after securing Federal Government approval. The state has also called for bids to build gas-fired power plants through the Clean Lagos Electricity Market to bridge the electricity gap. In Badagry West, Sanwo-Olu approved funding to restore power, with contractors already starting documentation.
What it means for Lagosians
Sanwo-Olu said the goal is “affordable and accessible light all around our state” and to make power outages “a thing of the past”. The PPA is the commercial engine, while the law provides the regulatory backbone. If the 400MW from the three firms comes online and the market rules work, Lagos moves closer to energy independence, SME growth without “costly, alternative power sources”, and safer streets at night. “We want to create a Lagos where businesses no longer need to rely on costly, alternative power sources.
