The Rural Electrification Agency (REA) has said that of the N3 billion worth of projects implemented in 2023, only N900 million was released, creating a total N2.1 billion funding gap to deliver its projects.
Umar Abdullahi Umar, the executive director, technical services at the REA, disclosed this in Abuja on Monday during a presentation on the REA 2023 capital project implementation.
According to him, drawing from the delivery of the National Poverty Reduction and Growth Strategy (NPRGS) and the traditional objectives of REA’s capital projects, the agency has optimised the deployment of multiple technologies, including solar mini-grids, solar water pumps (irrigation farming), solar home systems (low-capacity productive use) and solar street lights across Nigeria’s six geopolitical zones.
“And for 2024, our budget has been scaled up about four times what it was in 2023. That’s good news. If we’re impacting, and electrifying 1.4 million Nigerians, you can imagine we are doing times four of that for 2024.
“Also, there’s a question regarding the measure set for funding to complete outstanding projects and how much it is. The total funding for the national poverty reduction scheme is N3 billion; about N900 million-plus has been released; the amount pending is about N2.1 billion.
So, there’s collaboration and understanding between us and the mother agency that will provide the funding.”
He explained that the agency has reinforced its approach to monitoring and evaluation, an ongoing process which he said would be sustained till the full delivery of over 447 projects in the year under review.
“We are deploying a lot of IT infrastructure within the agency to help us in remote tracking of the implementation. This is something that we will start in the 2024 budget cycle,” he said.
Abba Aliyu, managing director of REA, noted different sources of funding for the agency, stressing that the Federal Government alone could address the energy gap. He said REA was about to complete the $550 million Nigeria Electrification Project, adding that the agency has recently secured an additional $750 million from the World Bank for ‘distributed access through renewable energy scale-up project’.
He said the project was the biggest public sector-funded off-grid, targeting the electrification of 17.5 million Nigerians out of the 85 million that do not have access to electricity. “And we are very clear how we intend to do that. 30 million Nigerians will be electrified using the isolated mini-grids, 1.5 million Nigerians with interconnected mini-grids, and about 12.5 million Nigerians with mesh grid and solar home systems.”
Aliyu said the $750 million World Bank fund was expected to crystallise $1.1 billion private sector investment.
“We do not rely on just the Federal Government budgeting. We know the government alone cannot address the energy gap. That is why we are innovative in sourcing different sources of funding. I mentioned the yearly budget cycle and the bilateral agreement we get from the World Bank and the African Development Bank. I am happy to say that the $750 million World Bank funding for the implementation of the distributed asset through renewable energy scale is the biggest off-grid funding project in the world.
“And because we use the $750 million as a capital subsidy, we expect the private sector to bring their funding for them to qualify to get this capital subsidy. So, the $750 million capital subsidy would crystallise $1.1 billion in private sector funding, which means that we have close to $1.8 billion to implement to make sure that we address this.
“The present government has been very ambitious and adventurous in making sure that this number of Nigerians without access is addressed in a very short period,” he said.
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