• Sunday, March 03, 2024
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Funds are flying around for renewables. Nigeria needs more than passing interest

Funds are flying around for renewables. Nigeria needs more than passing interest

Nigeria is struggling to light up the country. There is in inadequate electricity supply both for domestic and industrial uses. The Federal Government claims the country is generating 7,000MW but citizens are hardly convinced. Systems failure sometimes reduce the power available to less than 1,000MW with average daily power supply estimated at 3 hours and sometimes several days go by without any power at all.

Gas thermal plants generate about 85 percent of Nigeria’s power while hydro-electricity supply the rest. Shortage of gas, sabotage and vandalism of pipelines at certain times cut supply to the country’s gas thermal power plants.

Nigeria urgently needs a diversification plan and focus on renewables. And there are funds flying around to enable financing for small-scale renewable energy projects which can help households in remote communities gain access to clean electricity.

The World Bank Group through its Energy Sector Management Assistance Program (ESMAP), in partnership with International Finance Corporation (IFC), announced a new program to advance the adoption of offshore wind energy in developing countries and emerging markets. The $5 million program is being initiated to help low- and middle-income countries implement environmentally sustainable energy solutions.

Read Also: https://businessday.ng/energy/oilandgas/article/european-energy-groups-push-eu-for-tougher-climate-change-goals/

The African Development Bank (AfDB) approved an equity investment of up to $25 million in ARCH Africa Renewable Power Fund (ARPF). Also approved is a $250 million private equity fund for renewable energy projects across Sub-Saharan Africa.

There is a new €142 million initiative for Gambia to harness solar power and supply clean energy across the country, backed by the European Investment Bank (EIB), World Bank and European Union. The project will also be supported by €35.7 million financing from the World Bank.

“Connecting one of the largest solar power plants in West Africa to communities across Gambia will increase access to clean energy, create new economic opportunities and improve health and education for future generations.” said Andrew McDowell, European Investment Bank Vice President responsible for energy.

In 2018, the African Trade Insurance (ATI) and European Investment Bank (EIB) launched a $1 billion Renewable Energy Facility for sub-Saharan Africa. The facility is supported by the government of Germany and the EU as part of their commitment to backing the UN’s Sustainable Energy for All initiative.

Also, MIGA, a member of the World Bank Group, issued a guarantee of €128.1 million in support of the construction of the first wind farm in Senegal. The Parc Eolien Taiba N’diaye SA wind farm will be made up of 46 turbines, providing some 158.7MW to the national grid will come on line by 2020.

Top oil and gas companies are not left behind. Royal Dutch Shell, Total and BP have in recent years accelerated spending on wind and solar power. Europe’s oil majors account for around 70 percent of the sector’s renewable capacity.

Shell leads the pack with future plans to spend $1-2 billion per year on clean energy technologies out of a total budget of $25 to $30 billion. Norway’s Equinor plans to spend 15-20 percent of its budget on renewables by 2030. Since 2010, Total has spent the most on low-carbon energies, around 4.3 percent of its budget.

As a whole, the world’s top 24 publicly-listed companies spent 1.3 percent of total budgets of $260 billion on low carbon energy in 2018.

Nigeria may not be totally out of the scene but for a country of about 200 million people, the country needs more than just a passing interest.

Nigeria established its first green energy fund with the tripartite signing of a Memorandum of Understanding (MoU) between Vetiva Capital Management Limited Climate Finance Advisory Limited (CFAL) and the African Guarantee Fund West Africa (AGFWA) on the Green Energy Fund (GEF) Programme which will create green asset portfolio in excess of $100million over a period of 5 years.