Fed Govt secures $500m World Bank loan to fund Discos

The Federal Government has secured a $500 million loan from the World Bank to fund electricity Distribution Companies (DisCos).

According to a statement in Abuja Thursday by the Bureau of Public Enterprises, 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.

According to the privatisation agency, 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; and programme components.

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, reduceAggregate Technical, Collection, and Commercial (ATC&C) losses; improve remittances and liquidity for the DisCos; enhance the reliability of power supply; as well as increase transparency and accountability within the DisCos.

Show More

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button

Adblock Detected

Please consider supporting us by disabling your ad blocker