Nigeria has secured a $1.5 billion loan from the Export-Import Bank of the US for the improvement of solar power infrastructure across different locations in the country. This is a move that will help to generate low-cost electricity.
Cortese, the Chief Executive Officer of SUN Africa LLC, a utility-scale solar project developer and off-grid solution provider based in the US, disclosed this after delegates of the company met with President Muhammadu Buhari at the State House, Abuja, according to Thisday.
The 20 years loan which will be on a concessional rate would help generate low-cost electricity while enabling the company–Niger Delta Power Holding Company (NDPHC), which will own the asset–to pay back the loan.
Cortese stated that the project will build upon the success it had in Angola recently, where roughly $2.6 billion of solar PV storage and transmission capacity was delivered. He further emphasized the attractiveness of the facility, stating that the 20-year government-to-government loan being done on a concessional rate will give Niger Delta Power Holding Company (NDPHC) ownership of the assets while enabling it to pay back the loan.
This project is coming at a good time considering that the price of diesel has almost tripled to N800 a liter, due to the rising global oil prices stemming from the Russia-Ukraine war. Businesses and citizens have become heavily reliant on power generating sets as the national grid only provides 4,000 MW despite an installed electricity capacity of 12,500 megawatts in the country, increasing the demand for alternative power sources in Africa’s largest economy.
What President Buhari is Saying
President Buhari was delighted by the interest of the US-based developer to invest in the country’s power sector. He gave an assurance that the federal government of Nigeria would remain committed to collaborating with the private sector in improving energy access, creating jobs, and industrial development.
- The president said, “the rapid integration of solar power into the country’s energy mix would lead to an increase in electricity access to underserved and unserved communities.”
- “Initiatives like these will go a long way in developing local capacity through technology transfer and relieving transmission constraints through the generation and distribution of electricity in the local Distribution Companies Franchise Area, making off-take easier.”
President Buhari also highlighted some reforms his administration has embarked upon to address Nigeria’s energy needs. He listed the signing of the Nigeria Climate Change Bill in November 2021, implementation of the Power Sector Recovery Programme with the World Bank, and the Nigeria Electrification Programme aimed at enhancing energy access to remote communities.
Niger Delta Power Holding Company (NDPHC) will utilize the loan to provide solar power at 10 sites, starting with five, said Chiedu Ugbo, the Managing Director, NDPHC.