A technology group, Wärtsilä, will build, operate, and maintain, a new 30 MW power plant being for a Nigerian independent power producer (IPP) in Victoria Island, Lagos.
The facility will be operated for five years on behalf of the customer identified as Victoria Island Power Limited (VIPL), the special purpose company incorporated by Lagos-based Elektron Energy for this project.
The power plant will comprise three Wärtsilä 34SG gas engine-generator sets with related auxiliaries and is configured to accommodate an extension with one additional engine-generator set at a later stage.
The Wärtsilä modular power plant design concept enables this in a cost-effective manner with minimal disruption to ongoing operations.
This project is a first-of-its-kind for Nigeria and is expected to serve as a model to enable similar, optimally sized and locally financed power projects in the country.
This model means means the engineering, procurement, and construction (EPC) responsibility, together with the operation and maintenance (O&M) agreement, will be handled by Wärtsilä.
The equipment supply contract was booked by Wärtsilä in the fourth quarter of 2024.
The power plant running on natural gas will be embedded within the Eko Electricity Distribution Company (EKEDC) at their NEPA Close Site and has been developed through the collaborative efforts of Elektron Energy and their local partners.
The plant will enhance the availability and reliability of power supply to the consumers served by EKEDC.
VIPL has also secured power purchase agreements (PPAs) with individual customers on a service-based tariff philosophy.
“Elektron has conceptualised, developed, and funded the IPP and has secured the implementation by engaging Wärtsilä to assume single point responsibility for the major construction and operational aspects related to the eventual power generation facility. This pioneering project relies on reciprocating internal combustion engine (RICE) technology that has the efficiency and flexibility to deliver clean and reliable electricity to our customers”, says Mr Deen Solebo, Co-CEO & CFO at Elektron Energy.
“I was very impressed by Wärtsilä’s state-of-the-art manufacturing facilities during my visit to the Sustainable Technology Hub in Vaasa, Finland in late Q3 2024 and am happy with the readiness of the engine-generator sets. In parallel, clearing and preparation activities at the NEPA Close Site are progressing well and are due for completion within Q2 2025, after which construction can start. Commissioning is expected 15 months thereafter and the Operations & Maintenance agreement is timed to commence prior to the new build project reaching commercial operations date (COD)”, Mr Solebo added.
“Wärtsilä’s core competence in the engine power plant and services aspects represents a unique combination of a global company with a local presence that provides developers and financiers the comfort to invest and gives end-customers the confidence to sign up for PPA’s with medium to long-term tenures. The Wärtsilä solution is extensively adopted by industrial, utility & IPP customers worldwide and the excellent credentials and track record have been recognised as a great value proposition by lenders, insurance companies, and multi-lateral funding institutions,” says Mr Marc Thiriet, Energy Business Director, Africa at Wärtsilä Energy.
“Elektron is especially grateful to the invaluable contributions of its institutional investors and funding partners who have made this project possible including ARM Harith Infrastructure Fund LP, Nigerian Sovereign Investment Authority, InfraCredit, Bank of Industry, FBN Quest, and Stanbic Infrastructure Partners,” Mr Solebo added.