Hope for Stable Power as FG Transfers $1.3bn Zungeru Hydroelectric Power Plant to Investor
- The operations of the Zungeru Hydroelectric Power Plant have been officially transferred by the FG to a concessionaire
- This 700-megawatt plant, situated in Zungeru, central Nigeria, was constructed with the assistance of a $1.3 billion loan from China
- This transition is anticipated to make a substantial contribution to fulfilling the nation's escalating energy requirements
Legit.ng journalist Victor Enengedi has over a decade's experience covering Energy, MSMEs, Technology and the stock market.
The Zungeru Hydroelectric Power Plant's operations have been officially handed over to Penstock Limited, a concessionaire, by the Federal Government.
Source: UGC
This announcement came during the inaugural meeting of the National Council on Privatisation (NCP) for the year 2024 at the Presidential Villa in Abuja on Tuesday, February 21.
According to ChannelsTV, this transfer is anticipated to enhance Nigeria's power generation capacity and substantially contribute to fulfilling the nation's escalating energy requirements.
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Handing over Zungeru plant to Penstock Limited
It would be recalled that exactly a year ago, the federal government called for investors to bid for the concession of the 700MW Zungeru Hydropower Plant (HPP) in Niger State.
Following the bid, the FG approved Mainstream Energy Solutions Limited (MESL) as the preferred bidder for the concession.
MESL, the parent company of Penstock Limited, secured the Zungeru hydroelectric power plant with a concession fee of $70 million per year for 30 years.
The Concession Agreement, inked on December 13, 2023, between the Bureau of Public Enterprise (BPE) and Penstock Limited paved the way for this development.
Subsequent to receiving approval from the NCP, Penstock Limited fulfilled its obligations by remitting 50% of the commencement fees on January 5, 2024.
Zungeru hydropower plant
The Zungeru hydropower plant is located on the Kaduna River 8km upstream of the confluence of the Gumma River in Zungeru Town of Niger State.
The 700MW capacity Zungeru HPP is Nigeria's second-largest hydroelectricity power station, behind the Kainji Hydroelectric Power Plant.
The plant stands as Nigeria's most expansive hydropower endeavour and is counted among the continent's largest energy initiatives to secure a favourable loan package from the Export-Import Bank (Exim Bank) of China.
This hydropower project is anticipated to offer electricity generation, flood mitigation, and irrigation water supply.
With a capacity of 700 megawatts (MW), the Zungeru hydropower plant is projected to produce approximately 2.64 billion kilowatt-hours (kWh) of electricity annually, contributing nearly 10% towards meeting Nigeria's overall domestic energy demands.
FG says exporting electricity to Benin, Niger, strategic
Meanwhile, Legit.ng reported that Nigeria has continued to sell electricity to neighbouring countries despite many Nigerian homes not having access to power.
Nigeria's electricity generation recently collapsed to 3,876MW, its lowest level in months, and has remained below 5,000mw when the country needs over 28,000mw.
According to the Nigerian Electricity Regulatory Commission (NERC), Nigeria has a total of 8,310,408 registered active electricity customers.
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Source: Legit.ng
