The African Development Bank Group announced on Wednesday that it has approved a $500 million loan to the Federal Government of Nigeria to support the second phase of the Economic Governance and Energy Transition Support Programme (EGET-SP).
According to AfDB, the programme is designed to accelerate structural reforms in Nigeria’s energy sector, improve electricity infrastructure, and expand access to cleaner energy. It also seeks to strengthen fiscal policies by boosting non-oil revenues and expanding fiscal space, thereby reducing Nigeria’s reliance on crude oil earnings.
The initiative builds on the first $500 million loan approved in 2024, which supported Nigeria’s energy transition plan launched in 2022. That plan set ambitious targets: achieving universal energy access by 2030 and a carbon-neutral economy by 2060.
AfDB’s Nigeria Country Office Director General, Abdul Kamara, explained that the new funding will consolidate progress made under the first phase while driving deeper reforms. He noted that the programme will stimulate inclusive growth by aligning Nigeria’s fiscal and energy policies with global climate commitments.
The AfDB statement highlighted that the loan will cover Nigeria’s 2024–2025 fiscal years, supporting the implementation of the country’s new Electricity Act and energy transition roadmap. The programme is also expected to help Nigeria meet Sustainable Development Goal 7 (SDG7), which calls for universal access to affordable, reliable, sustainable, and modern energy.
Nigeria’s energy transition plan is considered one of the most ambitious in Africa, targeting the development of 250 GW of installed electricity capacity by 2050, with a strong emphasis on renewable energy sources.
Implications
For Governance: The loan strengthens Nigeria’s fiscal reforms, particularly efforts to diversify revenue away from oil.
For Energy Sector: It accelerates investment in renewable energy and modern electricity infrastructure.
For Citizens: The reforms aim to expand access to affordable and cleaner energy, reducing energy poverty.
For Climate Policy: Nigeria’s commitment to net-zero emissions by 2060 gains credibility with AfDB’s backing.
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