Power cuts are frequent in Africa's largest economy, with no city spared electricity shortages, due to inadequate generation capacity and a patchy grid.
The Gwagwalada Independent Power Plant, which will burn Nigerian gas, will provide about 11% of Nigeria's energy needs and will be built in three phases, state oil firm NNPC said.
Mele Kyari, NNPC chief executive said the power plant would help "monetise our abundant gas resources." Nigeria has some of the largest gas reserves in the world.
China Mechanical Engineering Corp. and GE Vernova are building the power plant in partnership with the NNPC, with the first phase expected to be completed in 2024, the NNPC said.
At a groundbreaking ceremony to mark the start of construction, Tinubu described the project as "first bold step" in his administration's efforts to establish a strong energy sector that will drive the Nigerian economy.
He pledged to increase Nigeria's power generation beyond current levels, stabilize the erratic grid and end distribution bottlenecks that hamper supply to homes and businesses.
Africa's leading energy producer has an installed power generation capacity of 12,500 megawatt but produces a fraction of that, leaving millions of households and businesses reliant on power generators.
But fuel prices have tripled since Tinubu scrapped a popular but expensive petrol subsidy, which has led to soaring costs and left millions reeling.
Regular blackouts and inadequate capacity are often cited by businesses as a key issue hindering growth in Africa's most populous nation.
The plant, along with two in the northern cities of Kaduna and Kaduna, is among the power projects planned along Nigeria's 614-km (384-mile) AKK natural gas pipeline corridor, to add 3600 megawatts to Nigeria's generation capacity, NNPC said.
