INTELLIGENT BRANDS // Green Technology
Electrification project
receives significant boost
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T
he Board of Directors of the
African Development Bank Group
has approved a US$150 million
sovereign loan to the Federal Government of
Nigeria to finance the Nigeria Electrification
Project (NEP). The financing will support
rural electrification efforts in the West
African country by facilitating private sector
development and rollout of off-grid solutions,
as well as the installation of dedicated power
systems for Federal Universities.
The Africa Growing Together Fund (AGTF), a
US$2 billion facility sponsored by the People’s
Bank of China and administered by the African
Development Bank, has also approved a
US$50 million loan to the Federal Government
of Nigeria to co-finance the project.
The joint financing from the Bank and AGTF
will support the Federal Government of
Nigeria’s efforts to address critical energy
access deficit in the country and catalyse
achievement of universal energy access
by 2030 targets. The NEP, which will be
implemented by the Rural Electrification
Agency (REA), presents an innovative
approach to address the energy access
deficit by channelling private sector
investments into commercially viable mini
grid and off-grid solutions.
The aim of the NEP is to increase access to
electricity services for households, public
educational institutions and MSMEs. The
Bank’s Vice President for Power, Energy,
Climate Change and Green Growth, Amadou
Hott, welcomed the Board’s approval of NEP,
underscoring the importance of projects
that leverage private sector investment into
energy access solutions.
“Given the limited amount of public
financing available, projects that catalyse
private sector investment are critical in
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enabling the Bank and its Regional Member
Countries meet their shared objective of
electrifying the continent within the next
decade,” said Hott.
The NEP is aligned with the African
Development Bank’s New Deal on Energy for
Africa, the High 5 priorities, as well as with
the Bank’s Climate Change Action Plan. The
project is further aligned with the Federal
Government of Nigeria’s Rural Electrification
Strategy and Implementation Plan (RESIP),
and the Power Sector Recovery Programme
whose objective is to increase private
investments into the energy sector.
One of the key objectives of NEP is
to de-risk and scale up private sector
investment in the off-grid sector. The African
Development Bank, operating both within
the framework of NEP and in the context
of its other initiatives in the country’s
energy sector, will work with public and
private sector stakeholders to encourage
the development of an ecosystem that is
conducive to facilitating the rapid, effective
and commercially viable electrification of
Nigeria’s off-grid communities.
Ebrima Faal, the Bank’s Nigeria Country
Office Director, celebrated the approval
considering recent reforms undertaken
by the Federal Government of Nigeria to
facilitate private sector development of the
off-grid sector.
NEP WILL PROVIDE
THE SPARK THAT
IS NEEDED TO
CONVERT PRIVATE
SECTOR INTEREST
INTO ACTION.
“Nigeria has already implemented one of the
most comprehensive regulatory frameworks
for off-grid development in Africa and has
attracted preliminary interest from both
large international companies and local
firms,” he said. “NEP will provide the spark
that is needed to convert private sector
interest into action.”
NEP will also create jobs and impact the
Federal Government of Nigeria’s broader
education sector goals by increasing
access to affordable electricity at Federal
Universities through hybrid power plants that
reduce heavy reliance on diesel generators.
Speaking after the Board approval, the
Managing Director of the Rural Electrification
Agency, Damilola Ogunbiyi, said: “We
are extremely pleased with the African
Development Bank’s decision to support
NEP. By supporting the electrification of
unconnected and underserved communities,
NEP will contribute materially to their
economic development. Access to reliable,
affordable and clean electricity will result in
savings for households and businesses, which
can be deployed to other uses. NEP will also
train and employ thousands of Nigerians
with particular focus on women and
young people.” n
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