Lagos Announces Plan to Launch First Independent Electricity Market in Nigeria

• Lagos State is set to become the first subnational entity in Nigeria and among the few in Africa to establish a fully regulated, independent electricity market through its integrated electricity policy and the Lagos Electricity Market
• The initiative aims to improve energy access, attract investment, and modernise the state’s energy ecosystem with a focus on digital monitoring, clean fuels, and local infrastructure production
• A new partnership with the federal government will also accelerate electricity delivery to underserved communities, boosting economic growth and improving residents’ quality of life

Legit.ng journalist Zainab Iwayemi has 5-year-experience covering the Economy, Technology, and Capital Market.

As the first subnational entity in the nation and one of the few in Africa to create a fully regulated, independent electricity market, Lagos State is poised to make history.

The state government is integrating all of its power-related policies into a single, comprehensive electricity policy as part of a reform to modernize its energy ecosystem. This strategy aims to improve energy availability, attract investment, and accelerate growth.

Commissioner for Energy and Mineral Resources, Abiodun Ogunleye, made the announcement during the 2025 Ministerial Press Briefing held in Alausa, Ikeja.

The event was part of activities marking the second anniversary of Governor Babajide Sanwo-Olu’s second term in office.

He said:

“We are consolidating our energy frameworks into one cohesive document that will help to streamline implementation and drive strategic partnerships. This revised Integrated Resource and Strategic Plan will reposition Lagos as a hub for sustainable power solutions.”

Ogunleye clarified that the new plan is a strategic roadmap that will direct investment from the public and private sectors throughout the electricity value chain, not merely an administrative update. Once approved by the governor, the plan will serve as the blueprint for a revolutionary change in the state’s electricity generation, distribution, and consumption.

Central to this change is the planned Lagos Electricity Market (LEM), a first-of-its-kind subnational energy market that will operate with its own regulatory framework. Ogunleye said that LEM will be equipped with digital technology to track electricity production and consumption in real time, guaranteeing transparency, efficiency, and strong consumer protection.

“The LEM will be powered by digital tools to monitor generation and usage in real time. This will ensure transparency, attract investors, and protect consumers,” he said.

The introduction of LEM aligns with recent constitutional reforms that grant Nigerian states the authority to autonomously regulate and manage electricity supply within their borders; Lagos is now positioned to lead this development.

According to Ogunleye, this move will guarantee dependable power availability for the state’s expanding industries and population while fostering a favourable investment climate.

“We want a policy environment that is not only investor-friendly but also serves the energy needs of Lagosians efficiently,” he added.

The state and the federal government have signed a memorandum of understanding to expedite the delivery of electricity in underserved communities. Ogunleye described the collaboration as a significant turning point that will raise economic productivity and improve the quality of life for many residents.

He said:

“This partnership with the Federal Government is a game-changer. It will deepen energy access and bring much-needed power to more households and businesses across Lagos.”

The Nation reported that the state is also increasing its focus on clean fuels to support its electricity reform strategy. Ogunleye revealed that the state-owned IBILE Oil and Gas sold more than 100 million litres of petrol and 9.6 million kilograms of liquefied petroleum gas (LPG) in the previous year, while 65 vehicles were converted to run on compressed natural gas (CNG).

“These figures show our commitment to cleaner energy and economic efficiency. Our gas initiatives are reducing emissions and saving costs for Lagosians,” he said.

Power sector infrastructure is likewise being localised. Ogunleye revealed that the government is collaborating with private sector companies to begin local production of energy infrastructure, including meters, transformers, cables, and switchgear.

He stated that this would boost the local economy, create jobs, and reduce reliance on imports.

Distribution company set to build solar energy project

Legit.ng reported that J-Marine Logistics Limited and Kaduna Electric Distribution Company (KEDCO) have inked a memorandum of understanding (MoU) for the construction of a 100-megawatt (MW) solar energy project that incorporates a battery energy storage system (BESS).

The plan is a significant move toward tackling power supply concerns and laying the groundwork for equitable economic growth and development, according to KEDCO chairman Aminu Suleiman, who spoke at the signing of the Memorandum of Understanding on Friday in Kaduna.

According to him, the partnership seeks to increase industrial productivity, provide cleaner energy, and strengthen the dependability of power supplies.

Source: Legit.ng