On 9 April, the vice president of Nigeria, Mr. Oluyemi Osinbajo, kicked off the rollout of a mass solar connections programme – tagged ‘Solar Power Naija’ (SPN) – at national scale by launching the pilot in the Jankefe community in Jigawa State. The initiative, a key part of the Nigerian Covid-19 economic response package approved last year, aims at electrifying 25 million Nigerians while also creating 250,000 jobs in the near term. It includes a financing facility worth 140 billion naira ($350 million) to provide low-interest loans to businesses operating along the domestic solar industry value chain.
The programme is coordinated by the vice president and his team of advisors, working closely with the Rural Electrification Agency and other stakeholders. Through our energy advisor’s direct support of the vice-president’s team, TBI contributed to its design and will continue to support its implementation. The support is made possible with financial support from USAID as part of TBI’s partnership with Power Africa.
This initiative is especially important for Nigeria where an estimated 80–90 million people are currently not connected to the main grid. Most of them entirely lack access to electricity, while a minority depend on expensive diesel-driven power generators which are not only expensive to run but also bad for the environment.
TBI’s advisor is part of a special technical committee set up to coordinate the programme. Following broad consultations and technical analysis of the options for boosting access to electricity for Nigerians, the committee designed a programme that focused on addressing a general reluctance by commercial banks to finance off-grid solar solutions (ranging from individual solar home equipment to mini-grids). A suite of innovative security instruments was introduced to minimise the risk exposure for the banks. One such instrument is a guarantor arrangement whereby a developer can access larger financing than what its balance sheet can ordinarily absorb if it is able to get certain government entities to issue financial backing through what is called an Irrevocable Standing Payment Order (ISPO).
By leveraging this guarantor model, one of the implementing agencies selected for the programme, the Niger Delta Power Holding Company, partnered with private company Asolar Ltd to roll out 100,000 solar home systems across the country. This first significant step towards delivering on the initiative will serve as a pilot. At its launch in the Jankefe community, the vice president reiterated the government’s commitment to taking advantage of the improved economic competitiveness of off-grid solar to accelerate the electrification rates across the country.
Following the successful launch, Asolar committed to more kick-offs across the six geopolitical zones of the country in the coming months. TBI will continue to support the technical committee in its role in overseeing the successful rollout of the programme, beginning with this pilot.
Through our partnership with Power Africa, TBI is supporting governments across the continent to provide power to their populations to light up homes and develop their power sectors. Our work includes support to power trading in East and West Africa, sector reform and planning in Nigeria, Senegal and Burkina Faso, and policy and planning support for energy access in Mozambique, Senegal and Nigeria.
Lead Image: Tolani Alli