The African Development Bank (AfDB) Group has approved a $500 million loan to the federal government to finance the second phase of its economic governance and energy transition support programme (EGET-SP).
EGET-SP is an initiative aimed at accelerating the transformation of the country’s electricity infrastructure and improving access to cleaner sources of energy.
On August 24, 2022, the federal government launched Nigeria’s energy transition plan as a major pathway in achieving universal energy access by 2030 and a carbon-neutral economy by 2060.
The government said the plan was designed to tackle energy poverty and the climate change crisis, as well as deliver sustainable development goal seven (SDG7) by 2030 and net zero by 2060.
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AfDB, on August 1, approved a loan of $500 million to Nigeria to finance the first phase of the energy transition programme.
In a statement on Wednesday, AfDB said the scheme’s policy-based operation is for fiscal years 2024 and 2025.
“The second phase of the programme aims to stimulate inclusive growth by accelerating structural reforms in the energy sector, while supporting progressive reforms of fiscal policy to boost non-oil revenues and expand fiscal space,” the bank said.
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According to the lender, the programme will place emphasis on three core areas.
“First, the programme will deepen fiscal policy reforms by strengthening public financial management systems and enhancing the transparency and efficiency of public spending,” AfDB said.
“Second, it will accelerate the reform of the power engineering sector to reduce energy poverty, expand access to energy, improve sector governance, and attract private investment.
“Third, it will support implementation of the energy transition plan through measures that promote climate change adaptation and mitigation, including the introduction of energy-efficiency standards for electrical appliances.”
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According to the financial institution, Nigeria’s nationally determined contribution (NDC) will also be updated for the 2026 to 2030 period.
“The programme’s direct beneficiaries are the Federal Ministry of Power, the Federal Ministry of Finance, the Federal Inland Revenue Service, the Office of the Auditor General, the Debt Management Office, the National Climate Change Council of Nigeria (NCCC), the Federal Ministry of the Environment, the Nigerian Electricity Regulatory Commission (NERC), and other bodies responsible for social and economic policies,” the statement reads.
“Benefits will also accrue to private businesses in the form of improved investment climate and opportunities in the energy sector at the level of individual states of the Federation, and from the creation of an environment more conducive to public-private partnerships.
“As of 31 October 2025, the active portfolio of the African Development Bank Group in Nigeria comprised 52 projects with a total commitment of $5.1 billion.”
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Commenting on the development, Abdul Kamara, director-general of the office of the AfDB in Nigeria, said the new phase will reinforce and build on the achievements of the first phase.
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