The Federal Government has concluded plans to raise $3.5 billion (N1.260 trillion) from the sale of government owned power plants, borrowing from banks and other multilateral financial institutions to maintain electricity generation of 4,000 MegaWatts (MW), The Guardian reports.
The Federal Ministry of Power said an estimated $3.5 billion budget appropriations will be required as part of the funding plan needed to revive Nigeria’s power sector. This is expected to ensure that a minimum baseline power generation of 4,000MW is guaranteed and distributed daily from 2017, to ensure stability of the grid.
According to the country’s Power Sector’s Recovery Programme, the financial shortfall in the power sector will be funded from the sale of government owned power plants, borrowing from the World Bank and other multilateral financial institutions and from the national budget.
It noted that work was ongoing to elaborate in detail the mechanism for funding the shortfall, taking into account fiscal space considerations as well as the detailed mechanisms on how the funding will be provided to market participants in tandem with regulator, governance and institutional reforms under the recovery programme to enforce market discipline.