Friday, May 24, 2024
HomeBusinessFG Moves To Boost Power Supply, Releases N18.26 Billion Loan To Five...

FG Moves To Boost Power Supply, Releases N18.26 Billion Loan To Five Power Firms

By Sadiq Umar, Abuja.

The Central Bank of Nigeria (CBN) has released the sum of N18.26bn to five energy firms as part of the N213bn Nigerian Electricity Market Stabilisation Facility.

The released was carried out following directives by President Goodluck Jonathan to the ministry of Power to consolidate its efforts aimed at improving power supply.

Minister of Power
Minister of Power

Speaking at the loan disbursement ceremony in Abuja on Monday, the CBN Governor, Mr Godwin Emefiele said the loan facility is a major initiative to reset the economics of the power sector.

“In partnership with the banking sector, CBN is providing this facility to address recent shortfalls in power sector revenues caused by needed adjustments in the electricity tariff and legacy gas debts,” Emefiele said.

He urged the beneficiary firms to utilize the funds to upgrade their power infrastructure, warning them against diverting the loan for other operational activities outside the loan agreement.

“The facility will be paid back over the lifetime of a reset electricity tariff. In exchange for this intervention, we fully expect parties that are collecting these funds today to ensure that the funds are repaid as and when due; ensure that all inputs into the generation of power are ramped up in a consistent manner

“They are to also invest the funds in the necessary improvements in generation plant maintenance, transmission upgrades and distribution networks including transformers and better metering for end consumers,” he added.

The benefiting power distribution firms that the N18.26bn loan include: Ibadan Distribution Electricity Distribution Plc which received the highest amount of N11.36bn, Eko Electricity Distribution Plc got N5.16bn, Jebba Hydroelectric Plc received of N816.83m while Kainji Hydroelectric Plc and Shiroro Hydroelectric Plc followed with N678.85m and N234.81m respectively.

They received the amount at an interest rate of ten per cent, with a repayment period of ten years.

Emefiele congratulated the five companies, saying there are the first set of power companies that have met all the apex bank’s requirements for the fund.

“This is just the beginning of this transaction and that there is still a lot of work to be done. Therefore, I enjoin everyone to keep up the good work that will enable us get to the finish line.

“And for us at the CBN, our finish line is when Nigerians can truly say that power supply has been ramped up and economic activities have benefited from this improved power supply,” he said.

Minister of Power Prof. Chinedu Nebo, who spoke at the event, described the disbursement as a major step that would help unlock the power sector.

“This is not a grant by any means; this is something that needed to happen. It needed to happen because of miscalculations of entering a market without what you could call a robust tariff structure,” Nebo said.

Speaking on behalf of the recipients, Chairman, IEDC, Mr Tunde Ayeni, assured the governor that the fund would be judiciously utilized to achieve the desired objective which is boosting power supply.

News Investigator
News Investigatorhttps://newsinvestigatorsng.com
NewsInvestigators provides all the top stories as they break, with updates and deeper insight into the reports. It focuses on local, regional and global news events in business, politics and entertainment in the true tradition of investigative journalism.
RELATED ARTICLES

Most Popular

Recent Comments