As parts of efforts to find solution to the challenge of power generation in the country, the U.S. African Development Foundation (USADF) and All On have officially opened the application window for the 2019 Nigeria Off-Grid Energy Challenge, which will provide up to $100,000 in blended finance per enterprise for the successful applicants.
The 2019 application window opens on February 1st and closes on March 15th, 2019.
Off-grid generation can be described as stand-alone power generation systems or mini-grids, which typically provide smaller communities such as rural areas; industrial clusters or residential estates with electricity through independent electricity distribution network systems.
The total off-grid electricity generation capacity as approved by the Nigerian Electricity Regulatory Commission (NERC) is still less than 500MW Considering Nigeria’s plans to increase generation capacity in the coming years and the low level of access to electricity in the rural areas; there is need for significant investments in off-grid generation.
It has the potential to grow industrial clusters and small cottage industries: Most industrial clusters and some small cottage industries require uninterrupted power supply to function optimally. The power supplied could be generated through fully off-grid power plants or embedded within distribution networks. This could potentially transform the economy of these areas; increase profitability for the existing businesses; create jobs; and breed a crop of customers who are willing to pay for electricity supplied.
USADF, a founding member of Power Africa and an independent U.S. Government agency established by Congress to support and invest in African owned and led enterprises and All On, an impact investing company backed by Shell investing in off grid energy solution providers in Nigeria, established the challenge as a multi-year partnership to identify and help scale innovative off-grid solutions to “power up” underserved areas in Nigeria.
Now in the second year of an initial three-year partnership, the parties will jointly provide funding to 100% African owned and operated small and medium enterprises that improve energy access through off-grid energy solutions spanning solar, wind, hydro, biomass and gas technologies. The enterprises may be developers of their own technology and/or acquiring and implementing technologies developed elsewhere. To benefit, applicants need to be legally registered in Nigeria, demonstrate the capacity to track and manage project resources and operate in good standing with the local governments in their areas of operation. Up to $50,000 per selected company will be provided in the form of convertible debt from All On, while up to $50,000 in the form of a grant will be provided by USADF.
The recipients of the 2018 Off-Grid Energy Challenge were Prado Power Ltd, Darway Coast, Auxano, Eastwind, Alyx, Creeds Energy and IKabin.
“The Impact of the All-On/USADF grant has been tremendous. It has given us leverage and impetus to really drive our vision and do much more. The rigorous process involved in getting the fund has opened our eyes to other untapped opportunities and expanded our scope as a company. It has also given us an opening to network with like-minded entrepreneurs and partners to progress the impact of renewable energy in Nigeria. We would like to express our deepest gratitude and appreciation to USADF and All On,” said Augustine Ureh, C.O.O of Darway Coast.
According to Washima Mede, CEO of Prado Power Limited, “It has not been easy bootstrapping and trying to gain traction as a new business. Thankfully, there are organizations like USADF and All On who have the development of this sector at heart”.
He said the USADF/All-On grant-loan has given them the chance to amplify their work, and they see themselves on the path to making reasonable impact on the quality of life for the people in terms of the energy situation.
