The Federal Government stated that increasing energy generation capacity to 30,000 megawatts in the next seven years will remain a mirage without private sector investments of roughly $3.5 billion annually.
This increases Nigeria’s investment requirement to at least $24.5 billion overall if the goal of increasing power capacity to 30,000 before 2030 is to be achieved.
When speaking at the “Solar Power Naija Programme Investor Matchmaking Event” hosted by the Rural Electrification Agency (REA) in Abuja, Minister of Power Aliyu Abubakar connected the nation’s industrial transformation to the electricity sector, adding: “Federal Ministry of Power is at the centre of undertaking critical actions that would transform the industry from public to a private sector-driven.”
Although Nigeria privatized its electrical industry in 2013, it has yet to achieve the reliable and consistent electricity supply that the nation has aspired to over the past year, despite the early optimism. The nation’s actual generation is still just around 4,000MW.
The electricity power sector reform (EPSR) Act was put in place by the FG, and a bill giving state governments the authority to produce, transmit, and distribute electricity was recently signed into law to encourage investment, according to the minister, who was represented at the event by the Director, Investments and Power Sector Development, Ministry of Power, Eyo Babalola.
According to Abubakar, there are countless investment prospects in the Nigerian electricity industry. The managing director of REA, Ahmad Salihijo, remarked that budgetary funding would not close the country’s rural electrification gap and emphasized the need for coordinated efforts to draw the private sector to the area.
According to Salihijo, the Solar Power Naija team has been talking to potential investors and guarantors interested in investing while working with assistance from the REA to enhance access to finance for solar power providers.
He added that the investor matchmaking will expedite funding possibilities and increase electricity availability to unserved and underserved communities across the nation. He claimed that the engagements and conversations had produced tremendous progress.
The Economic Sustainability Plan (ESP)’s goal of rolling out five million new solar connections in off-grid communities led to the creation of the Solar Power Naija Program.
The scheme is anticipated to increase tax revenues by an additional N7 billion year and replace $10 million worth of imports. The Federal Government anticipates that the program will increase local content in the off-grid solar value chain, increase access to energy for 25 million more people, support the expansion of the local manufacturing and assembly sector, and encourage the creation of 250,000 new jobs in the energy sector.
The initiative was initiated by the Federal Government giving access to N140 billion from commercial banks’ excess cash reserves at a low-interest facility for solar developers, according to the program’s head, Barbara Izilein.
She claimed that in order to confirm that businesses met their credit standards, the commercial banks had to go through a pre-qualification and evaluation process.
Izilein revealed that the program had been broadened to include additional potential investors who were eager to make substantial investments in the solar sector.
