Financing Clean Energy in Nigeria: World Bank to Provide US $750 Million
The International Development Association, an entity within the World Bank Group, has formally declared its intention to extend a credit totalling US $750 million for the purpose of supporting clean energy initiatives in Nigeria. This particular endeavour seeks to enhance accessibility to electricity in the most heavily populated country in Africa, which has grappled with this issue for a considerable period.
As of 2021, the number of individuals in Nigeria without access to electricity has surpassed 85 million, compelling many households and businesses to rely on costly diesel and petrol generators. In light of this situation, the Distributed Access through Renewable Energy Scale-up (DARES) project will be executed through the utilization of the International Development Association credit. It is projected that this project will result in the provision of new or enhanced electricity services for over 17.5 million Nigerians.
The World Bank has underscored the importance of this project in bridging the existing access gap. This initiative will build upon the accomplishments of the Nigeria Electrification Project, which has already facilitated the establishment of 125 mini grids and the distribution of over a million Solar Home Systems. These endeavours have led to over 5.5 million Nigerians gaining access to electricity.
To further bolster support for the DARES project, an additional $100 million in financing will be offered by the Global Energy Alliance for People and Planet, alongside $200 million from Japan’s International Cooperation Agency. Furthermore, more than $1 billion in private capital is anticipated to be leveraged for this initiative.
The substantial financial backing from the World Bank and other collaborating partners is essential for Nigeria to make noticeable advancements in enhancing its energy infrastructure, transitioning towards more sustainable and renewable sources of power.
The provision of clean energy in Nigeria represents a crucial stride in addressing the persistent challenges regarding electricity access in the country. It will not only enhance the standard of living for millions of Nigerians but also contribute to the overall economic development and sustainability of the nation.
The commitment of the World Bank to funding clean energy projects in Nigeria is indicative of the global acknowledgement of the significance of sustainable energy development in mitigating energy poverty and fostering economic growth in developing nations. This collaboration between international financial institutions, the government of Nigeria, and other stakeholders is a testament to the collective effort aimed at building a more sustainable and inclusive energy future for all.
