FG targets 3,000MW from 10,000 mini grid projects
Chineme Okafor in Abuja
The World Bank on Tuesday said it provided a $350 million loan to Nigeria for the development of rural electrification projects in the country.
This is just as the federal government has said it would by 2020, generate up to 3,000 megawatts (MW) of electricity with about 10,000 mini grid projects to electrify communities in the country that are yet to get connected to the national grid.
Speaking at the ongoing Action Learning Event on Upscaling Mini Grids for Low-cost and Timely Access to Electricity in Abuja, the Nigeria Country Director for World Bank, Rachid Benmessaoud, said the $350 million loan was given to the government, and that a lot of it would go to the private sector.
The bank also said that about 80 million people in Nigeria have no access to electricity, while about 600 million people in sub Saharan Africa do not have power supply in their various communities.
Represented by the World Bank Global Lead, Energy Access, Mr. Mac Cosgrove-Davies, Benmessaoud said: “With regards to the question on the loan, yes indeed this is a loan to government.
“That said, the Rural Electrification Agency (REA) will be the implementing agency for the loan and much of the funds will actually be going to the private sector. A lot of the funds that go from the World Bank to the government will be provided to the private sector.”
He earlier said during the opening session of the conference that globally, more than one billion people lack access to electricity.
“Sub Saharan Africa is home to about 600 million of these. In Nigeria, 80 million people are without access and millions more suffer from poor service. REA expects mini grids to fill a substantial portion of that gap covering up to 8,000 villages nationwide,” he added.
On how the $350 million loan would be managed, the Managing Director, REA, Mrs. Damilola Ogunbiyi, said $100 million out of the total sum will be dedicated to mini grid development.
According to Ogunbiyi: “The total loan amount for the electrification programme is $350 million, of which $100 million of that is going to be dedicated to mini grid development. As for the total quantum of electricity being targeted with the 10,000 mini grids, we are trying to achieve 3,000 megawatts.
“Some sites could be 150 kilowatts, some others 20KW, etc, but 10,000 (mini grids) is just a guide because people always need figures when we need to drive something home. So, it could be less than that, but if we can achieve 3,000 megawatts on off-grid, which will be close to the power generated on-grid, we will be very happy.”
Ogunbiyi, also explained that the loan will be disbursed through the World Bank’s Nigeria Electrification Project (NEP) to be implemented by REA after its approval in April 2018.
She said businesses in Nigeria spend up to N40 billion annually to generate unstable and expensive electricity, but that the REA was working with the private sector to provide off grid power supply strategies for businesses in the country.
According to her, about N9 billion worth of profit could be earned from private investments in Solar Home Systems (SHS) and mini grid systems.