The World Bank has restructured a $350 million loan to Nigeria to support Nigeria’s energy infrastructure and guarantee the completion of seven vital power plants at educational institutions.
The Nigeria Electrification Project (NEP) Restructuring Paper states that this restructuring entails extending the project’s conclusion date, with the new loan project deadline set at December 31, 2024.
The Nigeria Electrification Project (NEP), which was first approved on June 27, 2018, is to improve underserved micro, small, and medium-sized companies (MSMEs), public institutions, and households’ access to electricity services.
Despite progress, the completion of the seven power plants, crucial to the project’s success, was delayed due to unanticipated problems like geotechnical issues, community disturbances, and COVID-19-related disruptions.
The Restructuring Paper document read “To ensure the delivery of all 7 power plants as per the original scope of work, including unforeseen but necessary additional tasks, the project closing date would need to be extended by an additional 5 months to December 31, 2024.
“While the revised completion date for all 7 plants is expected by the end of Q3 2024, with the Maiduguri and Calabar sub projects anticipated to close by the end of September 2024, the last quarter will focus on site handover and the commencement of the sustainability plan. During this phase, the EPC contractors are expected to provide a performance guarantee to cover the operational and maintenance period.”
The Nigeria Electrification Project (NEP) is divided into various components, such as the development of mini-grids in the private sector, the extension of independent solar power systems for low-income and vulnerable families, and the supply of sustainable electricity to public universities and related teaching hospitals.
The project as of June, had installed standalone solar systems in almost 1.09 million homes and MSMEs and mini-grid grants in nearly 59,000 families and MSMEs.
Despite these achievements, Component 3, which involves the Energizing Education Program Phase II (EEP II), has lagged, with completion levels ranging from 35% to 80% across different sites.
According to the Restructuring Paper document, the total commitment for the Nigeria Electrification Project (NEP) is $350 million. The most recent update shows that $265.32 million has been disbursed, leaving $84.68 million as an undisbursed balance.
