Nigeria gets 30 years to repay World Bank loan

The World Bank has given Nigeria 30 years to repay the $350 million borrowed from it to fund its Rural Electrification Project. This project is expected to expand access and supply of electricity in rural communities, educational institutions and underserved micro, small and medium enterprises (MSMEs) in the country under the Nigerian Electrification Project (NEP).

However, according to Thisday, Nigeria will get an initial five years’ grace on the repayment of the loan which was approved in June 2017 by the Bank, disbursed through its International Development Association (IDA) credit window.

The fund  managed by the Rural Electrification Agency (REA) is a sovereign facility to the government to finance the Nigeria Electrification Project (NEP) with the World Bank, a private sector-led approach to speed up the development of mini-grid solutions in Nigeria’s rural communities.

The project has four components —solar hybrid mini-grids for rural economic development, stand-alone solar systems for homes and enterprises, energising education as well as technical assistance—will provide electricity to households, medium, small and micro enterprises (MSMEs) and public institutions at the least-cost and in a timely manner.

The NEP comes at a crucial time when the Nigerian power sector is experiencing a lot of challenges. Nigeria has the largest off-grid population on the continent with more than 100 million people lacking access to grid electricity. Majority of whom are found in the country’s rural regions where the average electricity access rate is 41.1 percent compared to the urban rate of 86 percent.

Mini-grid systems, comprising hybrid or pure solar mini-grids ranging from 50 kW to 1 MW, are deemed a sustainable solution to address rural energy access deficit in communities with productive loads and/or decent spending power.