Nigeria Inks 600MW Of Minigrid Deals

27 May 2024

Nigeria’s Rural Electrification Agency (REA) signed deals for 600MW of decentralised solar power systems to be built across Nigeria at the Energy Access Investment Forum held in Lagos on 21-23 May.

The first deal saw the US’ Husk Power Systems ink a memorandum of understanding (MoU) to deliver up to 250MW of minigrids to connect underserved peri-urban and rural communities across the country.

The focus will be on electrifying markets, businesses, households, public institutions, health clinics and schools in both weak grid and off-grid areas.

According to REA managing director Abba Aliyu, the MoU is part of the agency’s vision for creating a network of utility-scale renewable energy service companies (RESCOs) that can deliver reliable electricity to even the most remote corners of Nigeria.

The idea is to transform conventional project developers into service-orientated entities capable of constructing resilient infrastructure and delivering energy services on a large scale.

“By joining forces with Husk Power, we are not only positioned to achieve our ambitious renewable energy deployment goals but also to establish a model that can inspire others around the world,” he said.

Husk Power stated that the partnership will focus on power generation and distribution including interconnected minigrids and isolated minigrids, rooftop commercial and industrial (C&I) solar, productive use of energy (PUE) and appliance sales and credit financing.

The agreement also outlines collaboration on innovative new energy service models such as virtual power plants (VPPs) as well as community services such as e-mobility, agricultural processing and cold storage and clean cooking.

“To achieve universal electrification in Nigeria and supercharge the rural economy, stronger and more ambitious public-private partnership is essential,” said Manoj Sinha, co-founder and CEO, Husk Power. “This strategic partnership will fast-track the deployment of Husk’s AI-enabled energy platform, improve the lives of millions of Nigerians, displace tens of thousands of diesel generators and enhance climate adaptation and resilience. We will tailor our solutions to the needs of each community, giving them the ability to chart their own path to prosperity.”

In 2023, Husk Power set a target of having 1,000 minigrids in Nigeria, and another 1,500 in other parts of Sub-Saharan Africa within five years, with 1 million new connections directly impacting 7.7 million people. It currently has more than 20 minigrids operational in Nigeria.

In March this year, the company announced it had obtained US$20 million in debt financing from the European Investment Bank to scale its operations in Nigeria. This followed US$100 million in debt and equity financing obtained in October 2023.

The second deal saw Canadian/Nigerian firm EM-ONE Energy Solutions (EM-ONE) sign an MoU to develop 350MW of interconnected minigrid projects. This will include 200MW of capacity at C&I sites with large surrounding communities and up to 150MW for health facility electrification.

The partnership will also champion demonstration events, pilot projects and programmes to incentivise electric vehicle adoption and promote sustainable transport in Nigeria while overall building local capacity in renewable energy.