The Board of Directors of the African Development Bank Group has approved a loan of $500 million to the Federal Government to finance the first phase of the Economic Governance and Energy Transition Support Program (EGET-SP).
The programme is targeted at accelerating transformation of the country’s electricity infrastructure and improving access to cleaner sources of energy.
The loan will help close the financing gap of the Federal Budget in the 2024/25 fiscal year, specifically supporting the implementation of the country’s new Electricity Act and the Nigeria Energy Transition Plan).
The 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 energy transition plan envisions the development, by 2050, of 250 GW of installed electricity capacity, 90 per cent of which will be renewable.
It will provide clean cooking access to the bulk of the population by 2030, using liquefied petroleum gas (LPG), biogas, biofuels like ethanol, and electric cookstoves.
The EGET-SP will also support the implementation of these policies, helping deliver much-needed upgrades of the country’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 $500m support to the government is the latest in a series of initiatives aimed at supporting the country’s economic growth, poverty reduction, and climate action efforts.
The EGET-SP is in line with the Bank’s new 10-year strategy (2024-2033), its high 5s 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 African Development Bank Group’s active portfolio in Nigeria is valued at about $4.4 billion.
