With Nigeria said to have the largest number of people without access to electricity in the world, the Federal Government through the Rural Electrification Agency, REA, has stepped up effort to boost power supply to rural communities across the country with $550 million loans provided by the World Bank and the African Development Bank, AfDB. Already, the Federal Government supported by the foreign banks, has set up the Nigeria Electrification Programme, NEP, for the execution of the projects. The funding components are divided into $350 million from the World Bank and $200 million loan from the African Development Bank, AfDB.
The programme, according to the REA, has so far provided electricity to five million consumers. It also disclosed that it has signed 267 agreements worth about $395 million to provide electricity for unserved and underserved Nigerians under the NEP. The agency said about $64.8 million of the commitments has been disbursed to private sector partners for the execution of the projects.
REA Managing Director, Engr. Ahmad Salihijo Ahmad told journalists in Abuja that the programme is expected to provide off-grid reliable and clean electricity supply to 705,000 households, 90,000 micro, small and medium enterprises, 100 isolation and treatment centres and 400 primary healthcare centres in unserved and underserved areas of the country. He added that the programme also targets the provision of captive solar hybrid power plants to 15 Federal tertiary institutions and two teaching hospitals.
According to a fact sheet released by the Power Sector Recovery Programme, PSRP, one in every ten people without access to electricity in the World now reside in Nigeria. The PSRP has also disclosed that Nigeria’s power sector has not been able to keep up with the demand or provide reliable supply to existing customers, adding that only 51 percent of installed capacity is available for generation. It noted that an average Nigerian consumes four times less energy than her counterpart in a typical lower middle-income country, disclosing that businesses Nigeria lose about $29 billion annually because of unreliable electricity.
Engr. Ahmad explained over the years, REA has moved from just being an implementer of Federal Government’s projects in the sector to becoming a hub and enabler of business in the sector. He said the agreements signed with private developers have led to over a million connections across the country. According to him, “The REA has the mandate of taking power to unserved and underserved Nigerians. How it goes about doing this depends on where the funding comes from. According to the rural electrification strategy plan, we have targets to reach Nigerians everywhere in the country and the numbers at the moment are being quoted to be as high as 80 million people”. He noted that to achieve this, a lot of funding was required and “what we are used to doing is every year we wait and get government’s money from the budget, go to the site and then implement the projects. However, if you are to do this for the next 100 years, you will not be able to meet those targets hence it became important for the agency to ensure that its mandate does end at implementation”.
He explained that with the Rural Electrification Fund, which is a private sector driven initiative, REA became a hub and enabler to ensure that funding comes from different areas to enable it to deliver on its mandate. “Now government money is used as an enabler to attract private investment. For instance, for the rural electrification fund, you have a capital subsidy where if a project cost N100 million, that subsidy will come in at may be 50-60 percent and the private developer will come up with the rest of the money, deliver the service to the community and go into an agreement with the community for the rest of the money”.
Giving a breakdown of the NEP programme, its out-going head, Anita Otubu explained that the Nigeria Electrification Project have five components including solar hybrid mini-grid ($213m), standalone solar home systems ($75m), energizing education programme ($250m), energy efficient equipment and productive use of appliances ($20m) and Technical assistance ($37m). Otubu disclosed that so far 67 mini-grids have been completed with 995,396 solar home systems deployed, adding that so far 1,151 jobs have been created with 1,206 female headed MSMEs electrified. Besides the NEP, the Federal Government has continued to provide electricity to under-served communities with commissioning a 100KWP solar mini-grid at Atekombo Community in Ushongo local government area of Benue State.