The African Development Bank (AfDB) has approved a $210 million loan to help Nigeria upgrade its ailing electricity transmission and distribution network.
The loan to the Transmission Company of Nigeria (TCN) will support the construction of 330KV double circuit quad transmission lines and sub-stations across the country.
The AfDB funded project will run across seven states and will improve the capacity of power grid where it is most constrained.
Nigeria privatised most of its power sector in 2013 but retained control of its monopoly grid, operated by TCN. Most of the country’s power generation is from thermal power stations that use gas.
The creaking power grid has often been blamed for hobbling growth in west Africa’s largest economy.
The project looks to improve power export and regional power system integration to the West African Power pool, especially through Niger and Benin interconnections.
AfDB’s acting Vice President for Power & Energy, Wale Shonibare says implementing the project will increase evacuation from the south towards the north, where power supply is limited.
The project will also improve power export and regional power system integration to the West African Power pool, especially through Niger and Benin interconnections, he adds.
The country’s power output stands at around 4,000 MW. Total power generation capacity is about 7,000 MW but the transmission network cannot cope if plants operate at full tilt.
Nigeria’s privatized power sector typically does not use meters to provide invoices, bill collections are low and energy tariffs have remained fixed for three years.