Wärtsilä powers new 30MW Lagos gas plant

Wärtsilä, the global technology group, has been selected to supply and operate key power generation systems for a new 30 MW natural gas-fired power plant on Victoria Island, Lagos

The project is being executed by Victoria Island Power Ltd. (VIPL), a special purpose entity established by Nigerian energy developer Elektron Energy. Wärtsilä will also manage operations and maintenance (O&M) of the facility for an initial five-year term.

The contract, which includes equipment delivery and O&M services, was signed in the fourth quarter of 2024. The new facility will be embedded within the Eko Electricity Distribution Company (EKEDC) network at its NEPA Close site and is intended to improve electricity reliability for EKEDC’s consumers.

The project’s structure relies on strong collaboration between Elektron Energy and its Nigerian partners. VIPL has entered into power purchase agreements (PPAs) with commercial clients under a service-based tariff model.

“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,” said Deen Solebo, Co-CEO & CFO at Elektron Energy.

Wärtsilä’s scope includes three 34SG gas engine-generator units and all required auxiliary components. The modular design of the facility allows for a future fourth engine to be integrated with minimal interruption.

“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),” remarked Solebo.

Marc Thiriet, energy business Director, Africa at Wärtsilä Energy, 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.”

Funding for the project has been made possible through support from several key institutional investors and financial organisations.

“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,” added Solebo. 

As Nigeria continues to seek dependable and scalable power infrastructure, this Victoria Island facility is set to become a benchmark for future independent power projects in the country, especially those that are locally developed and financed.