NIGERIA – The Federal Government through its Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed has said that the World Bank has finally approved its $3bn loan request for the expansion of the power transmission and distribution networks in the country.
The minister said this while addressing journalists on the outcome of Nigeria’s participation at the annual meetings of the World Bank/International Monetary Fund in Washington DC.
She said the $3bn World Bank loan for the power sector would be disbursed in four tranches of $750m each, beginning from next year.
The loan, according to her, will cover the funding gap as well as the current tariff that investors in the sector described as very low compared to what was obtainable in other countries.
She further noted that the World Bank indicated its readiness to provide the technical assistance in the near-term and the funding in a programmatic manner
This financing according to Mrs. Zainab Ahmed will cover the gap between the current tariff and the actual cost of generating electricity.
The minister also revealed that some portion of the loan would be for the transmission network, adding that if the government could expand the facility to $4bn, then the additional $1bn would be used for the distribution network.
Mrs Zainab further noted that during the meeting with the World Bank, two critical problems were identified, and it was imperative that they were addressed.
These issues according to the minister were operational efficiency and revamping the associated infrastructure in the power sector to ensure the overall success of the interventions in the power sector.
Apart from the US$3 billion loan, the federal government is also collaborating with other international donor agencies to secure a steady supply of power in the country.
It has already in conjunction with these donor agencies set aside US$1.6 billion to be used in the implementation of the Transmission Rehabilitation Expansion Programme.
Managing-Director/Chief Executive Officer of the Transmission Company of Nigeria, , Alhaji Usman Gur, said “We are rehabilitating and expanding to degree 20,000 megawatts by 2022 across the country.”
Mr. Gur also revealed that about N32billion (US$ 88.52million) to compensate Nigerians, whose lands houses and farmlands would be affected by the right of way to establish power lines for the execution of the projects.
Nigeria’s power problems are mainly due to low efficiencies in power production, transmission and distribution.
It is hoped that the recent investments in the sector will help realize the much desired efficiencies and help Nigeria realize its goal of guaranteeing universal access to electricity for all its citizens.