Nigeria TV Info 

FG Cancels $717m World Bank Power Loan Amid Worsening Blackouts

Nigeria’s Federal Government has cancelled an undisbursed $717.7 million loan facility from the World Bank meant to support reforms in the country’s struggling electricity sector. The decision effectively ends the remaining part of a $1.52 billion Power Sector Recovery Programme earlier designed to improve electricity supply, strengthen tariff structures, and stabilise the nation’s power industry.

According to reports, the cancellation followed a joint agreement between the Nigerian government and the World Bank after authorities admitted that key reform targets could no longer be achieved under the programme. The World Bank reportedly noted that persistent financial challenges, rising tariff shortfalls, and implementation difficulties made continuation of the funding impractical.

The development comes as Nigerians continue to experience frequent blackouts, unstable electricity supply, and rising energy costs across homes and businesses. Data from the World Bank showed that tariff shortfalls in the electricity sector surged from about N140 billion in 2022 to nearly N1.9 trillion annually in 2024 and 2025, placing heavy pressure on government finances.

The power recovery programme had originally been introduced to improve electricity generation, transmission, and distribution while attracting private investment into the sector. Although part of the initial funding was disbursed and used, the additional financing approved in 2023 reportedly failed to meet major reform conditions required for further releases.

Economic analysts warn that the cancellation could worsen Nigeria’s electricity crisis unless urgent domestic reforms are introduced. Businesses already battling high fuel prices and inflation may face higher operating costs as dependence on generators increases. Experts have also expressed concerns over Nigeria’s rising external debt profile and the growing difficulty in implementing long-term power sector reforms.