Nigeria has approved counterpart funding for a contract that will enable Siemens AG upgrade the country’s failing power infrastructure. The German engineering company was contracted to rehabilitate and expand Nigeria’s electricity grid.
World Bank records that only about two-thirds of Nigerians have access to power, and the ones who have access to electricity are freely plunged into darkness. In some locations in the country, the blackout lasts as long as one month or two.
Bloomberg reported yesterday that President Muhammadu Buhari has granted an “anticipatory approval” for 18.94 million Euros, or 15% of the cost, as Nigeria’s counterpart funding for the project.
Quoting Nigeria’s finance minister, Hajia Zainab Ahmed, the report said the balance of 85% will be provided by Euler Hermes Group SAS, and backed by the German government, on concessionary terms with a three-year moratorium, a 12-year repayment period at “an interest rate of Libor-plus 1% to Libor-plus 1.2%.”
The project is planned to be implemented in three phases, and to be completed by 2025 when Nigeria estimates its on-grid transmission capacity would reach 25,000 megawatts. The country has an installed capacity of 13,000 megawatts, from which only a daily average of 3,500 megawatts is dispatched to consumers due to a poor transmission and distribution network.
By Chibisi Ohakah, Abuja