Page 7 - AfrElec Week 30 2021

AfrElec MINI- GRIDS AfrElec

Nigeria’s PowerGen secures $9mn

project financing for mini-grid project

NIGERIA NIGERIAN power developer PowerGen has ElectriFI, and CBEA. With their support, along-
secured project financing to build 28 distributed side that of Nigeria’s REA, the World Bank,
renewable energy (DRE) systems using solar PV Power Africa’s Nigeria Power Sector Program,
and battery technology in rural areas. and the communities themselves, we are eager
PowerGen is partnering with CrossBoundary to continue transforming lives through smarter
Energy Access (CBEA) and investors Oikocre- power.”
dit, Triodos Investment Management and EDFI PowerGen has already commissioned six
ElectriFI to facilitate the development, which sites, including the pilot site, Rokota, which was
will connect 55,000 people to electricity and pre- the first to be commissioned under the NEP Per-
vent 2,000 tonnes per year (tpy) of CO2, Power- formance Based Grant (PBG) programme. The
Gen said in a statement. financing will be used to develop and build the
The deal is structured so that Oikocredit, Tri- remaining sites in the portfolio.
odos IM and EDFI ElectriFI act as construction Nigeria is Africa’s largest economy but is
financiers for the transaction, providing $9mn plagued by poor energy access, particularly in
for the construction phase of the project. rural areas, where only 25% of people have access
Once operational, CBEA will purchase the to electricity
portfolio, becoming the long-term owner of the Power Gen’s statement said that transaction
systems and providing the construction financi- is being facilitated by CBEA’s project finance
ers with an exit. structure, which proves a model for bringing
This is a first for mini-grids in Africa at this long-term infrastructure capital into the mini-
scale and shows how innovative financing struc- grid sector at scale.
tures can bring private capital into the sector. The systems are being built into a special pur-
PowerGen will build the systems and con- pose vehicle (SPV) which will be fully acquired
tinue to act as the long-term operator of the by CBEA once the systems have met the pre-
project after the transfer to CBEA. The project agreed technical standards. Oikocredit, Trio-
will serve a base of residential, commercial and dos IM, and EDFI ElectriFI are able to provide
productive use customers. construction financing because they have a con-
Alastair Smith, co-founder and country tracted exit from a long-term financier.
director of PowerGen in Nigeria, said: “We’re Once CBEA becomes the owner of the pro-
very excited to continue scaling up distributed ject, PowerGen will step into a long-term con-
renewable energy systems in Nigeria in part- tract to operate and maintain the assets and
nership with Oikocredit, Triodos IM, EDFI provide customer service.™

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