FG, USAID collaborate on $75 Million for energy transition
•pump in N120 billion as first cache of Presidential Metering Initiative funding
Adewale Akintaro
The U.S. Agency for International Development, USAID and the Federal Ministry of Power, signed a memorandum of understanding, MoU, to foster support for the country’s electricity sector reforms.
This is even as the federal government removed N120 billion from April revenue as the first tranche of Presidential Metering Initiative funding.
On the government and USAID agreements , the USAID/Nigeria Mission Director Melissa A. Jones and Permanent Secretary of the Ministry of Power Mahmuda Mamman signed the MoU.
EnergyDay learnt that the deal will speed up the execution of a ₦115.2 billion (approximately $75 million) U.S. government grant-funded technical assistance program for power sector development and reforms in Nigeria.
It stated that “Currently, over 85 million Nigerians lack access to grid power, while many others face unreliable supply. These challenges force many Nigerian families and businesses to rely on expensive, emission-intensive gasoline and diesel backup generators.”
Jones emphasized the U.S. government’s commitment to advancing electrification in Nigeria, stating, “Today’s goal is to strengthen collaboration between USAID and the Federal Government of Nigeria and provide a framework for partnerships with other key actors, including state and local governments, electricity generation and distribution sectors, and the off-grid sector.”
Adebayo Adelabu, Minister of Power was effusive with gratitude for USAID’s support, adding that the partnership has the potential to transform Nigeria’s power sector.
He stated, “This collaboration with USAID is a significant milestone towards achieving sustainable and reliable electricity supply for all Nigerians. Together, we will address longstanding challenges, ensure transparency, enhance market liquidity, and accelerate our transition to clean energy solutions.”
The USAID addresses these challenges through the Power Africa Initiative, a U.S. government-led partnership that leverages public and private sector resources to double electricity access in sub-Saharan Africa.
Through this initiative, over 33 million Nigerians have been connected to power, approximately $4.5 billion has been mobilized for on-grid and off-grid power projects in Nigeria, and over 200 private companies in the off-grid sector have received assistance.
Meanwhile, the federal government has set aside N120 billion as the first tranche of the Presidential Metering Initiative (PMI).
According to the Federal Account Allocation Committee (FAAC) disbursement report for May 2024 by the National Bureau of Statistics (NBS), the amount is from revenue made in April and shared in May.
The N120 billion is about 10 percent of the revenue share in May 2024 among the three tiers of government and 9% of the N1.325 trillion is expected to be spent on the PMI.
Recall that Adelabu, had said that the government will provide an initial N75 billion as seed capital while the Nigerian Sovereign Investment Authority (NSIA) pledged to inject a minimum of N250 billion annually for the initiative’s duration.
The minister also disclosed that the initiative will leverage debt financing from diverse financial institutions to bolster the PMI’s resources.
