The African Development Bank Group has approved a loan of $500m to the Federal Government to finance the first phase of the Economic Governance and Energy Transition Support Programme.
EGET-SP is an initiative aimed at accelerating the transformation of the country’s electricity infrastructure and improving access to cleaner sources of energy.
A statement posted on the website of the bank on Thursday stated that these initiatives would decentralise the electricity supply industry and attract investments from subnational governments and the private sector.
“The Board of Directors of the African Development Bank Group has approved a loan of $500m to the Federal Republic of Nigeria to finance the first phase of the Economic Governance and Energy Transition Support Programme, a new programme aimed at accelerating transformation of the country’s electricity infrastructure and improving access to cleaner sources of energy,” the bank stated.
It also noted that the loan would help close the financing gap in the federal budget for the 2024/25 fiscal year, specifically supporting the implementation of Nigeria’s new Electricity Act and the Nigeria Energy Transition Plan.
Nigeria launched its energy transition plan in August 2022, and in June 2023 it passed the new Electricity Act.
The plan envisions the development of 250 gigawatts of installed electricity capacity by 2050, with 90 per cent of this capacity being renewable.
By 2030, it aims to provide clean cooking solutions to the bulk of the population using liquefied petroleum gas, biogas, biofuels like ethanol, and electric cookstoves.
The EGET-SP will support these policies by delivering much-needed upgrades to Nigeria’s electricity infrastructure and fast-tracking the transition of millions of households and businesses to cleaner, renewable energy sources.
The bank group’s $500m support to Nigeria is the latest in a series of initiatives aimed at supporting the country’s economic growth, poverty reduction, and climate action efforts.
As of July 2024, the African Development Bank Group’s active portfolio in Nigeria is valued at $4.4bn.
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