Lagos govt, LCFE unveil investment opportunities in energy sector

The Lagos State Government, in collaboration with Lagos Commodities and Futures Exchange (LCFE), has unveiled vast investment opportunities in electricity in the State on Saturday.

Following the enactment of Lagos State Electricity Law 2024, which empowers the state government to generate its electricity, key stakeholders, highlighted potentials for investment in electricity through various financial instruments, including equity, fixed income securities and derivatives .

Addressing participants at the Breakfast Meeting organised by the Lagos Commodities and Futures Exchange (LCFE) in collaboration with the Lagos State Government, themed “Building a Competitive Electricity Marketplace: Strategies to Attract Investment and Boost Confidence in the Lagos Electricity Market Using the Capital Market,” Lagos State Governor Babajide Sanwo-Olu reaffirmed the state’s commitment to creating an enabling environment for investors, with a focus on promoting sustainable development and economic growth.

Sanwo-Olu, who was represented by his Deputy, Dr Obafemi Hamzat, urged Lagosians to take advantage of the new Electricity Law for investment

According to him the use Energy to generate electricity as against the use of generator will reduce environmental pollution.

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He said, “In our new arrangement through Lagos State Ministry of Energy and Mineral Resources and Lagos Commodities and Futures Exchange (LCFE), there are lots of investment opportunities. Investors will make more money. It means people can purchase power. It is going to the market.

“That is what it is done in the Western World. Lagosians should participate . They should educate themselves about the new initiatives online.”

The LCFE’s Managing Director and Chief Executive Officer, Akin Akeredolu-Ale, expressed optimism that collaboration of The Exchange with the Lagos State Government would provide limitless opportunities for investment in Electricity.

According to him, the Lagos Power Market size is estimated at about USD 15billion in 2025, and is projected to grow at a CAGR of 4.28% during the forecast period (2025-2030).

“Today, we are officially launching the LCFE Electricity Receipt Quotation (LERQ) Electricity Board with the following products tradeable on the bourse: Power generation contracts, Power distribution contracts, Power infrastructure contracts, Electricity commercial papers, Metering contracts, Renewable energy contracts and Electricity receivables contracts

“Some of our core functions are provision of market to trade electronic receipts of commodities, creation of liquidity on any investment, de-risking, advocacy and capacity building.

“We also provide structured and fungible products as well as exit strategy for investors. We are licensed by the Securities and Exchange Commission (SEC) and we operate as a Self Regulatory Organisation (SRO).

“There are many investment opportunities in hydrocarbons in the global space.

“We shall develop commodities contracts to trade electricity, providing a platform for investors to participate in the electricity market.

“Our market provides opportunities for price discovery. We are ready to securitize power assets. There are huge opportunities in this area”, Akeredolu-Ale assured.

Earlier in his welcome address , the LCFE’s Chairman, Chief Onyenwechukwu Ezeagu lauded the Lagos State Government for its continued collaboration with LCFE and explained that the Energy Bill would encourage innovative products tradeable on Commodities Exchanges.

“The Lagos Commodities and Futures Exchange, as a key player in the capital market, recognizes the transformative potential of the Energy Bill. It is not just a policy framework but a call to action for all stakeholders to collaborate, innovate, and channel investments into Lagos State’s burgeoning electricity market. The Bill’s implementation will foster a competitive and investor-friendly electricity marketplac,” Ezeagu said.

The Securities and Exchange Commission (SEC), commended LCFE for its transformative approach to commodities trading in Nigeria . It’s Director General. Dr Emomotimi Agama, represented by the Commisioner of Operations, Bola Ajomale, explained that the Commission was ready to support the lofty initiatives of the Exchange.

Energy and finance experts discussed various options to invest in electricity and the consideration of investors in any financial market. There were outpouring of goodwill messages, including the Danish Consular General, Jette Bjerrum.

 

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