Kehinde Fajobi
The Federal Government has announced plans to secure ₦1.1 billion in private sector funding as part of its co-financing strategy for the power sector.
This was revealed by Abba Aliyu, Managing Director of the Rural Electrification Agency (REA), during the Nigeria Energy Summit in Lagos, themed “Breaking Barriers to the New Energy Era: Clean, Reliable and Sustainable.”
Aliyu highlighted the numerous challenges facing the power sector but assured attendees of the government’s commitment to addressing the electricity gap.
“In as much as we know there are lots of challenges in terms of the electricity aspect, the Federal Government is committing a lot of resources and a lot of strategies to be able to address this electricity gap,” he stated.
He elaborated that the government has already allocated $750 million to the sector, which is expected to catalyse ₦1.1 billion in private sector investment.
“We do not finance the entire infrastructure cost; we provide grant and subsidy as a way of catalysing this private sector funding, and we are also working towards catalysing ₦100 billion as local financing for the developers,” Aliyu explained.
Emphasising the importance of diversifying power generation sources, Aliyu noted that solar energy is becoming increasingly viable.
“The Minister of Power has asked us to look at how we can leverage on small hydro, micro-hydro, biomass, and wind, and we are working in that direction,” he said, announcing plans for a 336-kilowatt micro hydro project to be tendered in the coming weeks.
He added that projects involving small and micro hydros have been earmarked in several states, including Katsina, Ondo, Ekiti, Cross River, Nassarawa, and Sokoto.
“This is in our own effort to make the other sources of renewable energy integrated into our energy access drive,” he noted.
Aliyu also revealed that the REA has facilitated connections for 1.5 million Nigerians through mini-grids to improve electricity reliability.
“Three million of them grew isolated mini-grids to create electricity access for the first time, and about 12 million of them grew a mesh grid, stand-alone system, and solar home system,” he stated, mentioning that this initiative will officially commence next month.
He stressed the need for improved financial viability among private sector players in the energy market.
“The entire sustainability of the mini-grid, as any project finance infrastructure, is reliably computed upon the financial viability of the player that is implementing this,” he explained.
Hakeem Disu, Co-founder of Lihon Energy, commended Nigeria’s energy transition efforts, claiming they are the most advanced in Africa.
“The mini-grid and solar system that is coming from the Rural Electrification Agency is the way governments pointed that we can use to improve livelihood and economic activities of the people in rural areas,” he said.
Disu added that the initiative boosts investors’ confidence in Nigeria, stating, “Over 75 per cent of negotiations are very much interested in renewable energy.”
He also pointed out that the energy projects could enhance agricultural practices in rural areas, including solar-powered irrigation and drying systems.
In his opening remarks, Ade Yusuf, Exhibition Director at Informa Markets, highlighted Africa’s potential as a hub for global economic growth.
“The event has adapted to this new reality of the global conversation on sustainability, energy transition, and climate change,” he said, noting the region’s rapid transformation in energy markets.