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AfDB Approves $500m Loan To Nigeria For Energy Transition, Economic Governance

The African Development Bank (AfDB) Group has approved a $500 million loan to Nigeria to finance the first phase of the Economic Governance and Energy Transition Support Programme (EGET-SP).

The program is aimed to accelerate the transformation of Nigeria’s electricity infrastructure and improve access to cleaner sources of energy.

According to the AfDB, “The Nigerian government launched the energy transition plan in August 2022, and in June 2023, passed a new Electricity Act decentralising the electricity supply industry and setting the stage for increased investments by subnational governments and the private sector.”

The loan was said to help close the financing gap of the government’s budget in the 2024/2025 fiscal year, supporting the implementation of the new Electricity Act and the Nigeria Energy Transition Plan.

The plan envisioned the development of 250 GW of installed electricity capacity by 2050, with 90% from renewable sources.

“The economic governance and energy transition support programme will also support the implementation of these policies, helping deliver much-needed upgrades of Nigeria’s electricity infrastructure, and fast-tracking the country’s efforts to transition millions of households and businesses to cleaner and renewable sources of energy,” the AfDB said.

The loan is in line with the AfDB’s new 10-year strategy and priorities, and the New Deal on Energy for Africa, which seeks to achieve universal access to modern energy by 2030.

As of July 2024, the AfDB’s active portfolio in Nigeria is valued at about $4.4 billion.

Boluwatife Enome

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