Siemens to Begin Concessionary Funding of Electricity Deal With Nigeria

• Siemens to Begin Concessionary Funding of Electricity Deal With Nigeria

The Federal Government on Wednesday approved Siemens AG to begin the concessionary funding and support of Nigeria’s power sector.

In a series of tweets put out by the Presidency, President Buhari directed the Ministry of Finance, the Ministry of Power and the Bureau of Public Enterprises “to conclude the engagement with Siemens AG to commence the pre-engineering and concessionary financing aspects of the Presidential Power Initiative.”

“All items to be purchased were provided by the distribution companies and Transmission Company of Nigeria and they will be vetted by a professional project management office,” the Presidency stated.

It stated that the concessionary agreements included a three-year moratorium and a “12-year repayment at concessionary (interest rates) through the German Euler Hermes cover, which Nigeria will on-lend as a convertible loan to the other shareholders in the Discos.”

The Presidency added that “All Discos have, directly, and through the BPE, been diligently carried along over the last 15 months to understand in detail the challenges in the electricity system.

“The PPI is a power infrastructure upgrade and modernisation programme agreed to by Nigerian government and Siemens AG of Germany, with the support of the German Government.

“Under the PPI, Nigerian government will on behalf of the other shareholders in the Discos invest in infrastructure upgrades in the form of improved payment systems, distribution substations, transformers, protection devices, smart meters, transmission lines, etc.

“President Buhari has approved the release of funding for the first part of Phase 1 of the PPI, to kick off the pre-engineering and concession financing work streams.”