The federal government has secured a $500 million loan from the World Bank to fund electricity Distribution Companies (DisCos).
According to the Bureau of Public Enterprises, in a statement in Abuja, yesterday, the loan would fill financing gaps in the distribution segment, considered as the most problematic in the industry.
“This funding supports the Nigerian Distribution Sector Recovery Program (DISREP) aimed at improving the financial and technical performance of the Discos. The DISREP is designed to enhance the financial and technical operations of the DisCos through capital investment and the financing of key components of their Performance Improvement Plans (PIPs), which have been approved by the Nigerian Electricity Regulatory Commission (NERC),” the Bureau said in the statement signed by Amina Othman, Head, Public Communications.
It added that the $500 million DISREP loan offered concessional financing with more favorable terms than commercial bank loans. It is expected that DisCos would invest the funds “in critical distribution infrastructure; Improve ATC&C losses; increase power supply reliability; achieve financial sustainability in the power sector; and enhance transparency and accountability. Significant progress has been made in the preparation of the DISREP Programme”, BPE explained.
