• Wednesday, April 17, 2024
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CBN solar intervention to domesticate renewable energy technology in Nigeria

CBN solar intervention to domesticate renewable energy technology in Nigeria

Nigeria has started the disbursement of a N140 billion intervention facility by the Central Bank of Nigeria (CBN) to domesticate renewable energy technology and leapfrog mini-grid solutions to reduce the gap in the country’s access to electricity.

While the Sustainable Development Goals aimed at universal access to electricity, access rate remained at 60 per cent in Nigeria. Although the situation is fair in the urban areas, less than 41 per cent of rural areas have access to electricity.

According to the apex bank, 85 million Nigerians do not have access to grid electricity. This represents 43 per cent of the country’s population and makes Nigeria the country with the largest energy access deficit in the world.

Reportedly, lack of reliable power is a significant constraint for citizens and businesses, resulting in annual economic losses estimated at $26.2 billion (₦10.1 trillion) which is equivalent to about two percent of GDP. The 2020 World Bank Doing Business report, ranked Nigeria 171 out of 190 countries in getting electricity and electricity access is seen as one of the major constraints for the private sector.

“Getting loans in Naira denominated funds has been an issue because getting funds outside the country comes with foreign exchange problems,” said Sanusi Ohiare, executive director, Rural Electrification Fund, who had stated in Abuja that the government has been working and making remarkable progress through the N140 billion CBN fund, and that the government is encouraging local developers in the renewable energy industry.

“We have already disbursed to a few developers and we are hoping that going forward we can scale up the disbursement so that we can manufacture renewable energy components and provide electricity through mini-grids and solar,” he said.

Read also: What may likely happen if CBN stops dollar sales to banks

To most stakeholders, the N140 billion facility provided by the CBN remained a leeway to the projected national energy plan given the high rate of rural to urban migration, challenges faced by farmers to ensure food security and ineffective healthcare services.

Expected to complement the Economic Sustainability Plan (ESP), the CBN had launched the N140b facility aiming to provide five million solar home systems in under-served and off-grid communities across the country. With the plan, the CBN would make funds available to the private companies in the renewable energy sector (green energy).