Siemens deal will deliver 3,800 power and distribution transformers –Nigerian govt

3,800 power and distribution transformers will be installed across Nigeria in accordance with a deal between the Nigerian government, the German government and Siemens AG.

This was disclosed on Tuesday in a series of tweets on the Twitter handle of the Office of the Minister of Power (OMP), @PowerMinNigeria, which were confirmed by Power Minister Sale Mamman via his twitter handle, @EngrSMamman.

In May, the Nigerian government had sealed a power infrastructure upgrade and modernisation pact with Siemens that will transform Nigeria’s comatose power industry and see Siemens deliver 25,000 megawatts of on-grid power transmission by 2025.

The company’s planned overhaul of the electricity infrastructure in Africa’s most populous nation, where about 80 million people lack access to electricity and where those that do are at the mercy of perennial blackouts, is expected to take a cue from its success story in Egypt, where Siemens raised generation capacity by over 40% in less than three years.The World Bank, which projects that Nigeria loses around $28 billion or 2% of its gross domestic product annually to power cuts, ranked Nigeria as the second country in the world and first in Africa with the biggest electricity deficit as of 2018.

The OMP said 3,800 power and distribution transformers would be provided in the first phase of the Presidential Power Initiative deal with the German government and Siemens.

According to the Ministry of Power, 3,765 distribution transformers and 35 power transformers will be deployed in the first phase of the project.

Siemens intends to tackle the current inefficiencies in distribution and transmission in the first phase while upgrading capacity to 7,000 megawatts. The revamp and expansion project itself will connect about one third of Nigeria’s over 200 million people to the national grid.

11 units of trailer mounted transformers are also to be deployed while 431 units of auxiliary equipment will be provided.

‘Our ability to deliver all the automation of distribution, transmission and generation has boosted investors’ confidence, and oil and gas companies that had stepped back because of a lack of benefits are reconsidering,’ Onyeche Tifase, chief executive officer of Siemens Nigeria Limited said in a Bloomberg interview last week.

The OMP said 1,904 units of protective devices would be deployed across electricity distribution projects while 11 units of safety and testing equipment would be provided.

33 units of software licenses are also to be made available.

The World Bank approved a $750 million loan in June to create a sustainable metering and commercial framework for operating the national grid.

In July, the Nigerian government granted an anticipatory approval of 18.94 million Euros (N8.648 billion), representing 15% of the project cost, as counterpart fund for the revamp.

The balance will be backed by the German government through a concessionary arrangement that will grant Nigeria a three-year repayment holiday and a repayment duration of 12 years at ‘an interest rate of Libor-plus 1% to Libor-plus 1.2%.’