The world Bank has given Nigeria 30 years to pay back the rural electrification loan. The fund which is managed by the Rural Electrification Agency (REA) is expected to provide power to 2.5 million people and 70,000 small businesses.
Nigeria will have about 30 years to repay the World Bank the $350 million it borrowed from it to fund the expansion of access and supply of electricity to rural communities, educational institutions and underserved micro, small and medium enterprises (MSMEs) in the country under the Nigerian Electrification Project (NEP).
THISDAY gathered from the Bank that the country would, however, get an initial five years’ grace on the repayment of the loan which was approved in June 2017, by the Bank, to be disbursed through it International Development Association (IDA) credit window.
According to the fact sheet on the loan, the NEP is to be managed by the Rural Electrification Agency (REA) and will leverage private sector investments in solar mini grids and standalone solar systems to provide electricity to about 2.5 million people and 70,000 MSMEs.
It will also fund the provision of reliable electricity to seven universities and two teaching hospitals under the Energising Education Programme (EEP).
“The program will help increase access to electricity services for households, public educational institutions, and underserved micro, small and medium enterprises,” said the fact sheet in its description.
According to it, the project comprises of four components, with the first component being, solar hybrid mini grids for rural economic development which will be implemented under a market-based private sector led approach to construct, operate, and maintain economically viable mini grids.
This it added will be supported by subsidies that reduce initial capital outlays. “It consists of minimum subsidy tender for mini grids; and performance-based grants program,” it noted.
The second component of the NEP, it explained would be stand-alone solar systems for homes and MSMEs with the intention to significantly increase the market for stand-alone solar systems in Nigeria in order to provide access to electricity to more than one million Nigerian households and MSMEs at lower cost than their current means of service such as small diesel generating sets.
“It consists of market scale-up challenge grants; and performance-based grants,” the fact sheet added.
It said the third component of the NEP which is the energising education objective, will provide reliable, affordable, and sustainable power to public universities and associated teaching hospitals, while the fourth component will be technical assistance designed to build a framework for rural electrification upscaling, support project implementation as well as broad capacity building in the REA; Nigerian Electricity Regulatory Commission (NERC); Ministry of Power, Works, and Housing; and other relevant stakeholders in the industry.
Source: This Day