Nigeria's Edo Swaps Land for Stake in 100 MW Power Plant

The Edo State Government has secured a 10 per cent equity stake in a proposed 100-megawatt power plant by contributing land instead of cash, an arrangement Governor Monday Okpebholo said will allow the state to earn long-term revenue while avoiding the cost of financing the project.

The agreement was announced in Benin City after the governor met with the Managing Director and Chief Executive Officer of First Bank of Nigeria Limited, Olusegun Alebiosu, and the Managing Director and Chief Executive Officer of Jiangsu Communication Clean Energy Technology Co., Ltd. (CCETC), Di Xiaohui.

The power plant will be built at Ologbo and is expected to begin operations in November.

Land traded for ownership

Power plants are typically financed through public funding, private investment or a combination of both. Edo said it pursued a different approach by negotiating an ownership stake in exchange for land and government support.

Governor Okpebholo said the state will provide land, security and an enabling environment for the investment, while receiving a 10 per cent equity stake that gives it a share in the project's future earnings.

He said the arrangement allows Edo to benefit financially from the development without committing scarce public funds.

"Edo State does not have the money to invest in this power plant. But we have land, and we will provide security to ensure that your business thrives," he said.

"I also told them that we can not just give them our land; we have to be part owners too. They agreed to consider 10 percent equity. That is the agreement we are going to sign today."

The governor said his administration also wants investors to work directly with the state government rather than private individuals, describing the approach as a way to protect public assets and improve accountability.

Expansion of existing investment

CCETC already operates a 15-megawatt power plant in Edo. The proposed 100-megawatt facility at Ologbo will significantly expand the company's operations in the state and increase local electricity generation.

The Chinese company develops gas-fired and distributed power projects, including waste-to-energy and biomass facilities in China, and has expanded into overseas markets, particularly across Africa.

Okpebholo said the project offers benefits beyond improved electricity supply because the state's ownership stake will generate revenue while creating employment opportunities for residents.

"I am happy with this development. One, we will now have light. Two, we will also have a stake in the project. Not just a stake, we will also be receiving revenue from it. Our own children will also be employed by them. To me, this is more than enough," he said.

The governor said the agreement followed unsuccessful attempts to develop similar partnerships in the past and announced plans to pursue additional power projects in Edo Central and Edo North Senatorial Districts to improve electricity supply across the state.

First Bank Managing Director and Chief Executive Officer Olusegun Alebiosu said the bank was pleased to support investments capable of driving economic development in Edo.

He said the new power plant builds on CCETC's existing investment in the state and would strengthen electricity supply while supporting broader economic growth.

The Edo State Commissioner for Power said the project is expected to improve electricity availability, attract investment and create jobs.

He added that the state's equity stake gives it a direct financial interest in the long-term success of the power plant, allowing it to benefit from future returns as well as increased generating capacity.