- African Development Bank approves $500 million loan to boost electricity access and clean energy transition in Nigeria.
- Funding supports Nigeria’s Energy Transition Plan to achieve 250 GW of renewable energy capacity by 2050 and enhance clean cooking access by 2030.
The African Development Bank Group has recently approved a substantial $500 million loan aimed at bolstering electricity access in Nigeria. This funding is set to kickstart the first phase of the Economic Governance and Energy Transition Support Program, a pivotal initiative designed to overhaul the country’s electricity infrastructure and accelerate its shift towards cleaner energy sources.
Underpinning this endeavor is Nigeria’s ambitious Energy Transition Plan, launched in August 2022, and reinforced by the passing of a new Electricity Act in June 2023. These strategic moves decentralize the electricity supply industry, paving the way for increased investments from subnational governments and the private sector.
Looking ahead, Nigeria aims to achieve a remarkable 250 gigawatts (GW) of installed electricity capacity by 2050, with 90% of this derived from renewable sources. The plan also includes ambitious targets for clean cooking access by 2030, utilizing liquefied petroleum gas (LPG), biogas, biofuels like ethanol, and electric cooking stoves to benefit the majority of the population.
The $500 million loan from the African Development Bank Group not only supports the implementation of these progressive policies but also fills critical financing gaps in Nigeria’s 2024/25 federal budget. This investment is expected to catalyze much-needed upgrades to Nigeria’s electricity infrastructure, facilitating the transition of millions of households and businesses to cleaner and sustainable energy solutions.
In essence, this funding marks a significant step towards enhancing economic governance, reducing poverty, and advancing climate action in Nigeria, aligning with broader regional and global goals for sustainable development.