Excluding the newly approved $3bn for the expansion of the transmission and distribution networks in the Power Sector, World Bank’s bailout to Nigeria’s the sector in four years is over N1.3billion
Data obtained from the institution’s website revealed that between 2014 and 2018, the said sum was invested for transmission, distribution expansion as well as renewable energy.
For instance, in June 2018, the financial institution committed a sum of $350million for the country’s electrification project to ensure increased access to electricity services for households, public educational institutions, and underserved micro, small, and medium enterprises (MSMEs).
The project which is ongoing, comprised of four components and is expected to end by 2023.
Prior to this, the bank in February 2018, also committed $486million for Nigeria Electricity Transmission Access Project.
According to the Managing Director (MD)Transmission Company of Nigeria (TCN), Mr Usman Muhammad, the sum will support the rehabilitation and reinforcement of existing (brownfield) substations and lines.
“The project will be implemented throughout the country. It will also support the supply and installation of SCADA/EMS and consultancies that will support PPP projects in TCN in future among others,” he said.
The project is the Nigerian component of the North Core Transmission project which is expected to connect Nigeria, Niger, Benin and Burkina Faso on 330kV DC line.
According to the World Bank, a total amount of $465.5 million was in October 2018, approved-credit ($275.6) and grant ($189.9) to help the governments of Benin, Burkina Faso, Niger and Nigeria pursue their efforts to expand the supply of reliable and cost-effective electricity by promoting efficient regional energy trade among West African countries.
It explained that the new North Core Regional Power Interconnector project will connect the four participating countries through a regional high voltage transmission line, to strengthen their institutional capacities to participate effectively in the regional electricity market.
“Promoting regional interconnections not only allows for an increase in the total of electricity supplied at a cheaper average cost, but it also increases the system reliability and grid stability, which in turn allows for more renewable energy capacity to be added to the system”, Charles Joseph Cormier, Practice Manager for the Energy Global Practice at the World Bank, said.
Also, in May 2014, the bank also approved $395million for the sector’s guarantee project to increase the supply of electricity received to electricity consumers.
Meanwhile, the Minister of Finance Budget and National Planning, Hajiya Zainab Ahmed, had announced the approval of Nigeria’s request for a $3billion loan for the expansion of the transmission and distribution networks in the power sector.
This is over two times what the sector has received from the bank in four years.
However, public analysts have argued that the borrowing will further increase the debt profile of the country.
The National President of Association of Public Policy Analyst (APPA) Comrade Princewill Okorie stated that the move was not well thought out by the (FG) as the loan may increase Nigeria’s debt profile and consume a large chunk of the federal budget.
“The 2020 budget proposal has appropriated N2.45 trillion for debt serving. Rather, effort should be made to encourage the independent electricity distribution networks to function optimally,” he said.