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Increasing rural electrification to ease fuel subsidy removal, says Ohiare

By Kingsley Jeremiah, Abuja
13 February 2023   |   3:44 am
Executive Director (ED) of Rural Electrification Fund and board member of Rural Electrification Agency (REA), Dr. Sanusi Ohiare, yesterday, backed removal of subsidy on Premium Motor Spirit...

Ohiare

Executive Director (ED) of Rural Electrification Fund and board member of Rural Electrification Agency (REA), Dr. Sanusi Ohiare, yesterday, backed removal of subsidy on Premium Motor Spirit (PMS), stressing that the current administration’s strides in off-grid electricity solution for rural communities would provide leeway for dwellers.

Ohiare, in a chat with The Guardian in Abuja, stated that the model adopted by REA in financing electricity across unserved and underserved communities has impetus for funding challenges.

The REA had stated that 342 grant agreements had been signed with local firms to provide renewable and off-grid electricity for far-flung areas across the federation under the Nigeria Electrification Projects (NEP), as the financing model deployed by the organisation provided energy for estimated 6.8 million Nigerians. About $350 million of the funding was secured from the World Bank and $200 million loan from the African Development Bank (AfDB).

The ED, who is also a key member of the ruling All Progressive Party (APC), noted that while investing in rural communities appeared to be unbankable, the model deployed under his leadership provided a leeway for rapid electrification of rural communities with renewable energy.

Even as Nigeria spent about N7 trillion on petrol subsidy in 2022, N3.36 trillion is billed to be spent till June this year when it hopes to stop the project.

Minister of Finance, Budget and National Planning, Zainab Ahmed, during a public presentation of the 2023 budget, said government made provision of N3.36 trillion for fuel subsidy to cover the first six months of this year.

Ohiare said the current administration had long envisaged possible challenges the removal might throw up and proactively scale up electrification of rural communities, including primary healthcare and educational institutions, to ameliorate the situation.

His words: “Most rural communities used to stay on small generators in their homes and businesses. But when we brought renewable energy into their communities, it displaced fuel. So, they no longer need to queue to get fuel because they have renewable energy at their disposal.”

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