ABUJA – Experts in the power sector have estimated that over 100 million Nigerians lack access to electricity coming from the national grid, a situation that can be improved through
solar mini-grids if adequately harnessed.
The experts drawn from key power agencies also averred that the average mini-grid capacity utilisation as of 2021 was put at 42.5 per cent, a development that also poses threat to the country’s profitability, sustainability, and scalability of off-grid solutions.
To this end, the Nigeria Rural Electrification Agency (REA) proposed an improvement in productive energy use through capacity utilisation of the mini-grids to increase economic activities in communities.
At the 68th monthly Power Dialogue to discuss the various Productive Use Appliances and Equipment (PUE) Financing programmes that REA is currently implementing, the experts noted that productive use equipment financing schemes have improved energy use in off-grid communities.
Among the panel discussants at the dialogue who dissected the challenges bedevilling the sector include Suleiman Babamanu, Nigeria Country Director, Rocky Mountain Institute (RMI); Temitope George, Component Lead, Mini-Grids & Productive Use Appliances and Equipment at Nigeria Electrification Project (NEP); Onyinye Anene-Nzelu, Head of Mini-Grids at ENGIE Energy Access; and Salamatu Baba Tunzwang, Executive Secretary at the Renewable Energy Association of Nigeria.
The stakeholders agreed that electrification must extend beyond providing energy to ensure that the communities can utilise it to spur economic development.
They said while the communities understand this point, they typically lack the high upfront acquisition costs for productive use equipment and appliances, hence the need for specialised financing programmes.
Babamanu noted that the Energising Agricultural Programme (EAP) is a 3-year facility jointly developed by REA and RMI and funded by the Global Energy Alliance for People and Planet (GEAPP). The programme is a market-led solution that increases off-grid electrification while driving agricultural development.
Temitope George noted that the NEP’s productive use equipment financing component is a $19 million facility that aims to provide 24,500 micro, small and medium-sized enterprises (MSMEs) with productive use systems.
She said mini-grid developers in communities with productive use capacity can access between 30 and 60 per cent of their PUE costs. So far, the programme has selected five mini-grid sites and is open to other qualified developers.
George also noted that the facility is not restricted to agricultural equipment financing as there are over 200 economic activities that can benefit from the programme.