Abuja - The African Development Bank (AfDB) has described Nigeria power sector reform as the most ambitious ever undertaken in the history of the country.
This is contained in the bank’s 2013 Economic Report on Nigeria released by its country office in Abuja on Wednesday.
According to the report, power generation in the country is targeted to reach 13 000 megawatt by 2015 and 40 000 megawatt by 2020.
It stated that the institutionalisation of the reform through the 2005 Electric Power Sector Reform Acts was a positive step taken to actualise the successful power sector reform.
The report noted that significant progress made in implementing the reform included the unbundling and privatising the long-standing government owned monopoly firm in the sector.
It said the successful handover of generation and distribution assets to private investors in November 2013, development of cost reflective tariff and establishment of market players were commendable.
It added that power reform had attracted significant investment into the sector with the signing of memorandum of understanding with energy giants like General Electric, Siemens, power China and Elecrobas.
The report said the federal government‘s $30 million, AfDB’s $100 million and Chinese EXIM Bank’s $500 million intervention funds to the Transmission Company of Nigeria contributed to the success of the reform.
It, however, identified some challenges confronting the reform, which include raising long-term finance for the emerging private sector-owned generation and distribution companies estimated at $10 billion by 2020.
It stated that the funding challenge could be tackled by creating private sector financial intermediaries and instruments for deploying the country’s pension fund totalling about 23.2 billion dollars as at December 2013.
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