Lagos Introduces No Power, No Pay Policy, Signs New Power Agreements

The Lagos State Government has introduced a “no power, no pay” policy as it signed three power purchase agreements aimed at improving electricity supply and ensuring payment is made only for energy delivered to public facilities.

Governor Babajide Sanwo-Olu disclosed this in a statement on Sunday, noting that the agreements are part of efforts to address gaps in power delivery and enhance reliability across the state.

“Today at Lagos House, Marina, I witnessed the signing of three power purchase agreements designed to build on existing capacity and address what has not been working,” the governor said.

Under the arrangement, Fenchurch Power will supply electricity to key water facilities in Adiyan and Iju, while Mainland Power will continue to provide power to Ikeja, Oshodi, and Anthony, with plans to expand coverage. Viathan will maintain electricity supply to major facilities on Lagos Island, alongside efforts to improve integration with the distribution network.

Sanwo-Olu stated that the agreements have been updated to reflect current realities in the power sector, with a revised payment structure to ensure accountability.

“We have updated these agreements to reflect current market realities. We will no longer pay for power that is not delivered. Payments are now tied to actual, metered supply, helping us reduce waste and manage costs more effectively,” he said.

According to the governor, the initiative is expected to enhance power reliability for public infrastructure, ensure efficient use of state resources, and support future expansion of electricity capacity.

“This means more reliable power for public infrastructure, better use of state resources, and a clear path to scale capacity over the next few years,” he added.