President Muhammad Buhari had directed the Ministries of Power, the Finance Ministry and the Bureau of Public Enterprises (BPE) to commence with Siemens for the pre engineering and concessionary financing aspects of the Presidential Power Initiative (PPI)
The PPI is power and infrastructure upgrade and modernisation programme agreed to by the Nigerian government and Siemens with the support of the German government through which, Nigeria will on behalf of the other stakeholders in the electricity consortium invest in infrastructure upgrades in the form of improved payment systems, distribution substations, transformers, protection devices, smart meters , transmission lines etc.
The Nigerian government believes that the project will deliver improved power supply from the current five megawatts to 25MW nationwide, resulting in job creation, boosting investor confidence, ease of doing business. It will provide training and capacity building for thousands of young Nigerians.
Other benefits include creation of economic opportunities for Nigerian companies that will serve as local vendors for the provisions of manpower and equipment. This will stimulate and encourage inflow of additional investment into the power sect and the ultimate goal is to modernisation and increase the Nigerian electricity grid capacity.
The Nigerian government has further directed that to ensure value for money and preserve the integrity and transparency of the procurement under the government-to-government framework, Siemens AG shall be solely responsible for nominating it's engineering, procurement and construction (EPC) partners to perform all onshore works.
Funding for the project will be secured under concessionary terms of up to three year moratorium and 12 year repayment at concessionary interest rates through the German Euler Hermes.
The Nigerian government has approved the release of funding for first phase of the project to kick off the pre-engineering and concession financing work streams.
