The government of France, under the French Development Agency/Agence Francaise de Developement (AFD), has agreed to invest $70 million into renewable energy projects in Nigeria.
This development was revealed by Mr Chukwudumije Igwe, Member, Project and Structured Finance, Sub Sahara Africa, Access Bank, during the Sustainable Use of Natural Resources and Energy Finance (SUNREF) Nigeria programme investor conference recently in Lagos.
While making the announcement, Igwe said the $70 million funds will be used for renewable energy stakeholders through Access Bank Plc and United Bank for Africa (UBA).
Igwe revealed that the fund would be deployed to boosting investment into Nigeria’s renewable energy space and help fight pollution. He added that SUNREF was committed to financing projects that were innovative, energy-efficient and renewable in Africa.
He said: “SUNREF is a fund that has been made available by AFD to back renewable and energy-efficient projects.
“Access bank is one of the disbursing banks and we are looking forward to reviewing and accessing projects that meet eligibility and also the risk criteria.
“The total size of the fund is 70 million U.S dollars and has been shared between Access Bank and UBA and we are looking for eligible projects to disburse this fund to.
“We know that a lot of the SUNREF project are power and renewable projects and we know how critical infrastructure is to Nigeria and the federal government cannot do it alone.
“The private sector is key and we also know that bridging this gap would involve private sector and development finance institutions.
“This is why this is very critical and we hope that the fund would bridge a whole lot of the nation’s infrastructure gap,” he said.
The team Lead, SUNREF Nigeria, Mr Javier Betancourt, stated that though the 70 million U.S dollars was large, it was not enough for the project. He however stated that it was good for a start because what Nigeria needed was billions. He added that over 80 million Nigerians were totally un-electrified while the remaining 100 million were somewhat electrified.
He said: “The investment needed is enormous and $70 million does not even begin to cover it, but it does help start things.
“This fund we are bringing in will be longer terms with minimum of five years and these are concessional lending rates which would help to finance these projects.”
Betancourt added that it would be tough to predict the exact amount Nigeria needed for the renewable sector to cover the nation’s energy gap, but maintained that Nigeria needed another 14GW of energy, a total investment of about $10 billion.
He said: “$70 million is a drop in the ocean, but it is an important drop because it will help move this sector to get the appropriate finance.