GenCos Set to Gain Foreign Exchange from West Africa Power Pool Amid Market Shifts
Nigerian power generation companies (GenCos) are poised to reap foreign exchange (FX) benefits through participation in the West Africa Power Pool (WAPP), following recent shifts in the domestic electricity market. With Nigeria struggling to fully utilize its generation capacity due to liquidity crises and non-cost-reflective tariffs, cross-border electricity trading offers a lucrative alternative.
The WAPP initiative, designed to enhance power generation and transmission infrastructure across ECOWAS member states, is on track to achieve permanent grid synchronization by June 2026. This milestone will allow Nigeria to export electricity efficiently to neighboring countries, creating a regional market that benefits both power producers and consumers.
Joy Ogaji, CEO of the Association of Power Generation Companies, highlighted that about 98% of the generation business is dollarized. She explained that without access to a dedicated forex window, GenCos struggle to fund essential repairs and operational maintenance. “Nigeria has never utilized more than 50% of its generated power since 2013. Sending surplus electricity to neighboring countries is not just economically sensible—it’s vital for the survival of our generation companies,” Ogaji said.
Adebayo Adelabu, Minister of Power, emphasized that full synchronization would place Nigeria at the center of a more resilient and interconnected regional power system. By integrating the national grid into the broader WAPP network, Nigeria can rely on cross-border support during supply shortfalls and help stabilize neighboring grids, aligning with global best practices for advanced power systems.
The Nigerian Independent System Operator (NISO) confirmed successful grid synchronization tests on November 8, 2025, connecting Nigeria’s electricity network to WAPP. Once fully operational, countries including Ghana, Niger, Mali, Sierra Leone, Liberia, Senegal, Togo, Burkina Faso, Guinea, Gambia, Guinea Bissau, Cote d’Ivoire, and Benin will be linked in a regional power-sharing framework, unlocking forex earnings and bolstering regional energy security.
source: Business day