FG to get fresh $500m loan from AfDB

• Published On: 02 August 2024 at 19:41

The African Development Bank Group will grant the Federal Government a $500 million loan to cover the first phase of the Economic Governance and Energy Transition Support Program.

EGET-SP is an effort that aims to accelerate the transformation of the country's electricity infrastructure and increase access to cleaner energy sources.

These measures would decentralise the electricity supply industry, attracting investment from subnational governments and the private sector, according to a statement put on the bank's website on Thursday.

"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 institution announced.

It further noted that the loan would specifically support the implementation of Nigeria's new Electricity Act and Nigeria Energy Transition Plan, thereby helping to close the federal budget's finance shortfall for fiscal year 2024-2025.

Nigeria ratified the new Electricity Act in June 2023, and it began implementing its energy transition strategy in August 2022.

By 2030, it wants to provide clean cooking choices for the majority of people through the use of electric cookstoves, biogas, liquefied petroleum gas, and biofuels such as ethanol.

EGET-SP will support these activities by improving Nigeria's electrical infrastructure and speeding the transition of millions of homes and businesses to cleaner, renewable energy sources.

The bank group's $500 million contribution to Nigeria is the most recent in a string of programs aimed at boosting the country's economic growth, reducing poverty, and promoting climate action.