The African Development Bank Group (AfDB) has authorized a loan of $500 million to the Federal Republic of Nigeria. The loan will support the first phase of the Economic Governance and Energy Transition Support Program (EGET-SP), designed to transform Nigeria’s electricity infrastructure and improve access to cleaner energy sources.
According to a statement from the bank, the fund is designed to bridge the financing gap in Nigeria’s 2024/25 federal budget, specifically supporting the implementation of the newly enacted Electricity Act and the Nigeria Energy Transition Plan.
Launched in August 2022, and with the Electricity Act passed in June 2023, these initiatives aim to decentralize the electricity supply industry and attract increased investments from both local governments and the private sector. The Nigeria Energy Transition Plan targets the development of 250 GW of installed electricity capacity by 2050, with 90% sourced from renewables. By 2030, it aims to provide clean cooking solutions to the majority of the population through liquefied petroleum gas (LPG), biogas, ethanol, and electric cookstoves.
The EGET-SP will facilitate the upgrade of Nigeria’s electricity infrastructure and fast-track the transition of households and businesses to renewable energy sources. The AfDB’s $500 million support to the most populous nation in Africa is the latest in a series of initiatives aimed at bolstering the country’s economic growth, poverty reduction, and climate action efforts. The EGET-SP aligns with the AfDB’s new Ten-Year Strategy (2024-2033), its High 5s priorities, and the New Deal on Energy for Africa, which aims to achieve universal access to modern energy by 2030.
As of July 2024, the African Development Bank Group’s active portfolio in Nigeria is valued at approximately $4.4 billion.
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