• Sunday, February 25, 2024
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25 million Nigerians to access power on Kano Disco $200m funding

25 million Nigerians to access power on Kano Disco $200m funding

…targets 100 mini-grids

In a move to fix Nigeria’s electricity woes, Kano Electricity Distribution Company (Kano Disco) is seeking $200 million in investment to upgrade its infrastructure and revolutionise electricity distribution for an estimated 25 million Nigerians.

An exclusive document seen by BusinessDay showed Kano Electric is partnering with BlackAion Capital, Mauritius-based firm to re-capitalise the network and specifically work on the $200 million fundraise for the interconnected mini-grids and embedded generation projects in Kano, Katsina and Jigawa States.

“We believe Kano’s network is the most exciting network for investment, not just in Nigeria but in Africa. Where else do you have a large economy with 25 million people subsisting on mainly Diesel and small petrol generators with insufficient grid supply,” Okwu Njoku, managing partner at BlackAion said.

He added, “Every green investor in the world should be trying to get into Kano because the environmental impact of allowing Kano DISCO to continue to be inefficient is too high, and you can still make a high return while being good”.

The ambitious plan, championed by the company’s core investors, aims to build at least 200MW of incremental capacity through at least 100 mini-grids and embedded generation.

“You will see these interconnected mini-grids popping up everywhere in our network in Katsina and Jigawa also to augment electricity supply for our consumers, while we prioritize bulk grid supply to industrial consumers,” Adamu Gumel, chairman of Kano Disco said.

He added, “We are looking at some of our key industrial clusters such as Tokarawa and Sharada for 24-hour supply through embedded generation”.

BusinessDay findings showed the new core investors in Kano DisCo have signalled the intent to make Kano DisCo the first “Green DISCO in Africa” through the usage of Embedded Solar Hybrid Power Plants, mini-grids, Energy Storage Systems (ESS) and Power Purchase Agreements with Generators with Clean Energy such as nearby hydro-power plants.

“We are in serious discussions with the institutional investors and the Governments of Kano, Katsina and Jigawa to re-capitalise and re-position this entity to be the best performing DisCO in the country,” Habib Daura, a representative from the new Core investor, Future Energies Africa and director on the Board of Kano DisCo said.

With no direction on electricity tariffs centrally, Findings showed most DisCos operating in Africa’s biggest economy are increasingly looking at more liberalised willing-buyer, willing-seller models of supply to drive efficiency.

“The interconnected mini-grid model is viewed as an important option for networks that are peri-urban with energy needs but lack supply,” Kano DisCo said.

Kano DisCo also announced plans to execute more mini-grids with a suite of Developers and Engineering, procurement, and construction (EPC’s) led by those who executed the Zawaciki project to speed up the execution of the project to build out 100 interconnected mini-grids in an accelerated time-frame.

Findings showed Zawaciki power plant, the DisCo’s first site, which was co-funded by members of Kano DisCo’s core investor consortium, the World Bank (through the Nigerian Electrification Project with the Rural Electrification Agency) and the Global Energy Alliance for People and Planet is ready for technical commissioning.

The $2 million Interconnected mini-grid (the largest of its kind) includes a 1MW interconnected Solar-Diesel Hybrid Solar Plant, metering for 2000+ consumers and low Voltage network revamp and rehabilitation, a statement from Kano DisCo said.

The Zawaciki power plant was built by developer Bagaja Renewables with the construction executed by a consortium led by EMOne with Diginet and Digitbit.

Recall, Future Energies Africa announced the acquisition of Kano DisCo on November 3 after successfully restraining the sale to PowerCom in July through legal action.

The new developments in Kano DisCo is significant as President Bola Tinubu assented to the electricity bill, last June, which authorises states, companies and individuals to generate, transmit and distribute electricity.

The new electricity law repeals the Electric Power Sector Reform Act which was signed by former President Olusegun Obasanjo in 2005. The new Act consolidates all legislations dealing with the electricity supply industry to provide an omnibus and ideal institutional framework to guide the post-privatisation phase of the Nigerian Electricity Supply Industry and encourage private sector investments in the industry.

It also provides a framework for the improvement of access to electricity in rural, unserved, underserved, peri-urban and urban areas through the use of conventional sources and renewable energy off-grid and mini-grid solutions