World Bank boosts Nigeria power supply with $500m loan
By Patience Ikpeme
The World Bank has advanced $500 million loan to the federal government to address identified gaps in the Electricity Distribution Companies (DisCos).
The Bureau of Public Enterprises (BPE) confirmed the loan facility on Thursday via a statement issued by Amina Tukur Othman, BPE Head, Corporate communications.
The facility was approved by the bank’s board of directors way back February 4, 2021 as funding support to the Nigerian Distribution Sector Recovery Program (DISREP) aimed at improving the financial and technical performance of the DisCos.
DISREP is designed to enhance the financial and technical operations of the DisCos through capital investment and the financing of key components of their Performance Improvement Plans (PIPs), which have been approved by the Nigerian Electricity Regulatory Commission (NERC).
BPE listed key areas of improvement to include, bulk procurement of customer/retail meters and meter data management systems, implementation of a Data Aggregation Platform (DAP);
strengthening governance and transparency within the DisCos, program components, DISREP comprises two main components: Programme for Results (PforR), allocation of $345 million,
support the implementation of selected PIP components; BPE as implementation,investment Project Financing (IPF) and $155 million as allocation.
“The purpose is to finance the procurement of meters, a data aggregation Platform, and technical assistance”, BPE explained.
The agency explained DISREP loan, particularly the Investment Project Financing (IPF) component, is expected to significantly benefit the Nigerian Electricity Supply Industry (NESI) by closing the metering gap,reducing Aggregate Technical, Collection, and Commercial (ATC&C) losses; improving remittances and liquidity for the DisCos and enhancing the reliability of the power supply amongst others.
The $500 million DISREP loan from the World Bank offers concessional financing with more favorable terms than commercial bank loans.
