ADB Offers Local-Currency Credit To Nigeria’s Clean Power Developers
Lack of locally-denominated finance, and sufficiently long-term loans, are well-established hurdles to the development of photovoltaics in Africa the African Development Bank (AFDB) is addressing one of the key funding challenges for renewables across the continent by offering Nigerian clean power developers access to naira-denominated credit for up to 15 years.
The second Solar Power in Africa webinar, organized by analyst REGlobal, heard from the European Bank for Reconstruction and Development‘s Gabriel de Lastours that few commercial lenders in Africa are prepared to offer the 25-year credit arrangements required by clean power developers.
But Wale Shonibare, director for energy financial solutions, policy, and regulation at the AFDB, said the development financier has introduced the Nigerian infrastructure network to offer finance in local currency. The product helps attract different types of investors, depending upon the form of the local solar value chain, Shonibare told last week’s event.
Staying in Nigeria, Anita Otubu, head of the program management unit for government initiative the Nigeria Electrification Project, gave details of a drive by Abuja to provide off-grid renewable electricity, backed by a $350 million loan from the World Bank and $200 million in credit from the AFDB.
Otubu said the government wants to provide clean power to 705,000 households, 90,000 micro-to-medium sized businesses, 400 health centers, 100 Covid-19 treatment and isolation centers, 15 federal colleges, and two teaching hospitals. The off-grid program also aims to provide 24,500 appliances to meet mini-grid load demand. The initiative, Otubu said, would provide an NGN140 billion ($336 million) credit facility to fund 5 million new solar connections to help 25 million people.
The online webinar was supported by New Delhi-based electricity trade website Global Transmission Report and compatriot publication Renewable Watch, and sponsored by Chinese manufacturer Trina Solar.