US Invests $1bn To Boost Power Generation, Supply In Nigeria, Five Others

Nigeria and five other countries in Africa are to get over $1billion debt and financing commitments from United States agencies and private investors.
The sum is for Africa energy initiative known as Power Africa, which received US President, Barack Obama’s signature at the US-Africa Business Forum, Tuesday, in New York.
United States Agency for International Development (USAID) Chief, Gayle Smith, said that the latest deals were finalised at the US-Africa Business Forum on the sidelines of the ongoing United Nations meetings in New York.
Smith said that the deals covered funding for regional infrastructure facilities, risk insurance and renewable power projects in Kenya, Nigeria, Senegal, Sierra Leone, South Africa and Tanzania.
Obama inaugurated the initiative in 2013 with an initial investment of $7billion, which aimed to install 10,000 megawatts of new generation capacity and connect 20 million new customers.
It is also aimed at improving electric reliability across the Sub-Saharan Africa.
The programme hoped to attract private capital into energy projects in a region where regulatory hurdles and lack of risk instruments have often kept Western investors away.
To date, Power Africa has mobilised more than $52billion in additional commitments, of which $40billion is from private companies, according to USAID, which coordinates the programme.
Power Africa is tracking more than 500 deals, and 40 transaction advisers working across Africa have identified 60,000 megawatts of potential deals, Smith says.
While the initiative has been criticised for its slow start, she said that projects were starting to come online.
“We are starting to see some of these projects go online and actually start the generation.
“We are seeing an uptick in commitments, which is because confidence of the market is building and they’re seeing you can actually get these transactions done,” Smith said.
Smith said that the Electrify Africa Act, which unanimously passed by the House of Representatives and Senate aimed to build on Power Africa
He said that the passage sent “a signal that this is something the US will continue to do” even as the Obama administration winds down.
The legislation is largely symbolic and declares the policy of the US to encourage electrification in Africa and instructs the US Treasury and other agencies to make electrification funding a priority.
Source: Reuters/NAN