Mariam Abeeb
In a strategic move to address the identified gaps in the Electricity Distribution Companies (DisCos), the Federal Government of Nigeria has secured a $500 million loan from the World Bank.
In a statement by head, Public Communications, Amina Othman, it’s stated that the loan which was approved on February 4, 2021, by the World Bank Board of Directors.
It’s added that the funding is to supports the Nigerian Distribution Sector Recovery Program (DISREP) aimed at improving the financial and technical performance of the DisCos.
“The Distribution Sector Recovery Program (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).
“Key areas of improvement include:Bulk procurement of customer/retail meters and meter data management systems, Implementation of a Data Aggregation Platform (DAP),Strengthening governance and transparency within the DisCos, Program Components, The DISREP comprises two main components:
“Program for Results (PforR), Allocation: $345 million,Purpose: Support the implementation of selected PIP components, Implementation: Bureau of Public Enterprises (BPE), Investment Project Financing (IPF), Allocation: $155 million
The Purpose is to finance the procurement of meters, a Data Aggregation Platform, and Technical Assistance.
“The DISREP loan, particularly the Investment Project Financing (IPF) component, is expected to significantly benefit the Nigerian Electricity Supply Industry (NESI) by: Closing the metering gap, Reducing Aggregate Technical, Collection, and Commercial (ATC&C)losses, Improving remittances and liquidity for the DisCos, Enhancing the reliability of power supply, Increasing transparency and accountability within the DisCos.
According to the statement, the $500 million DISREP loan from the World Bank offers concessional financing with more favorable terms than commercial bank loans.
She stated that this will enable the DisCos to Investincritical distribution infrastructure, Improve ATC & Closses, among many others.
The statement explained that progress has been made in the preparation of the DISREP Program, with several key milestones achieved, and approval by the Federal Executive Council (FEC).
