World Bank has approved $500 million to Nigeria to improve its electricity distribution sector and further help 85 million Nigerians that are yet to connect to power grid get connected.
The bank, in a statement released on Friday, said that the project will help boost electricity access by improving the performance of the Electricity Distribution Companies (DISCOs) through a large scale metering program desired by Nigerians for a long time.
It explained that financial support would be provided to private distribution companies only on achievement of result in terms of access connections, improved financial management and network expansion.
According to the bank, 85 million Nigerians do not have access to grid electricity.
“This represents 43 per cent of the country’s population and makes Nigeria the country with the largest energy access deficit in the world,” the statement said.
“The lack of reliable power is a significant constraint for citizens and businesses resulting on annual economic losses estimated at $26.2 billion (N10.1 trillion) which is equivalent to about 2 per cent of GDP.”
The statement quoted Shubham Chaudhuri, World Bank Country Director for Nigeria, as saying that “Improving access and reliability of power is key to reduce poverty and unlocking economic growth in the aftermath of the global COVID-19 pandemic.”
“The operation will help improve the financial viability of the DISCOs and increase revenues for the whole Nigerian power sector which is critical to save scarce fiscal resources and create jobs by increasing the productivity of private and public enterprises,” it said.
The bank said the Nigeria Distribution Sector Recovery Program (DISREP) will help improve service quality as well as the financial and technical performance of distribution companies by providing financing based on performance and reduction of losses.