UK Pledges £10m For Energy Projects In Nigeria

The United Kingdom’s Minister for Africa, Latin America, and the Caribbean, Vicky Ford.
The United Kingdom’s Minister for Africa, Latin America, and the Caribbean, Vicky Ford.

 

The UK is providing up to £10 million of concessional aid to reduce the risk for pension and insurance funds to invest in energy access projects, and support Nigeria’s COP26 commitments.

The financing will help Nigerian investors focus on low carbon energy, supporting off-grid, low-carbon energy projects.

The £10 million will be blended to de-risk transactions and therefore mobilise domestic institutional investment from local pension funds, insurance firms and other local institutional investors.

This will help scale up domestic financing for eligible off-grid clean energy infrastructure, such as solar mini-grid and home systems, clean cooking infrastructure and SME cold storage infrastructure in Nigeria.

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Speaking on the financing, the UK Minister for Africa, Vicky Ford, said: “The UK is committed to increasing both renewable energy and energy access in Nigeria, driving clean, sustainable and resilient growth.

“As the world looks to transition to clean growth, we are witnessing an era-defining opportunity for the private sector. This transaction is particularly exciting as it brings together UK government support with the institutional capital which is essential to grow the sector at scale.”

This innovative blended finance initiative will provide affordable long-term financing from local investors for the low carbon energy sector to support scaling up of off-grid low carbon energy projects in unserved and underserved communities.

This initiative will support the implementation of Nigeria’s Nationally Determined Contributions plan, which Nigeria submitted to the UNFCCC before COP26, its Energy Transition Plan, which was presented by the Nigerian government at COP26, and Nigeria’s plans to increase energy access including the Solar Naija programme.

Uche Orji, MD/CEO of The Nigerian Sovereign Investment Authority (NSIA), and Chairman of InfraCredit, said: “InfraCredit is pleased to be working with FCDO to mobilise private investment from domestic pension funds and other institutional investors into such an important developmental area as low carbon energy access.

“This programme is aligned with NSIA’s other clean energy initiatives which aims to deliver up to 250-500MW of renewable energy capacity in Nigeria that will reduce annual CO2 emissions, alleviate poverty, create jobs and support local economic growth.”

The InfraCredit is a Nigerian entity whose capital providers are the Nigeria Sovereign Investment Authority, Africa Finance Corporation, African Development Bank, KfW Development Bank, InfraCo Africa and GuarantCo.

InfraCo Africa and GuarantCo are both Private Infrastructure Development Group companies funded by a range of development Partners – United Kingdom, Switzerland, Australia, Sweden, the Netherlands, France and Canada. InfraCredit provides local currency (Naira) guarantees to enhance the credit quality of debt instruments issued by eligible infrastructure project sponsors.

Fashola Commissions Ikorodu Skid Plant

Lagos State Governor, Mr. Babatunde Fashola (SAN), on Tuesday commissioned another Skid Plant in Ikorodu, reiterating the commitment of his administration to ensuring that Lagos residents make the Liquefied Petroleum Gas (LPG) a preferred choice for cooking.

Speaking at the Ewu Elepe Village, Ginti, venue of the commissioning, Governor Fashola, who was represented by his Deputy, Princess Adejoke Orelope-Adefulire, said one of the priorities of his administration in this second term was to revamp and reposition the Energy Sector in the State to enable it play its role in the socio-economic and environmental development of the State.

Expressing dismay that Nigeria is ranked the lowest in the use of LPG in the continent, in spite of its position as the largest producer of the product, the Governor declared, “We also recognize the immense potential of the country’s gas resources. It is only right that we devise a means to apply the existing solution to an existing problem meaning that this gas can be used to provide electricity for our country Nigeria”.

On the reason for introducing the cooking gas to Lagos state residents, Governor Fashola said, “A large percentage of households in Nigeria still use kerosine and firewood for cooking. These two fuels are not only the major sources of emission but on the long run may be more expensive than LPG”.

He said the Lagos State government recognizes the negative impact the current cooking fuel, kerosene and firewood, pose to the environment and people in terms of emission, “The use of LPG has several advantages as fuel because of its simple structure and because it is free from impurities, making it one of the few clean and efficient burning fuels in the world”.

He said the State Government was “working seamlessly” to strengthen the needed infrastructure, to ensure the development of the oil sector and to ensure that Lagos residents could make a shift using liquefied petroleum.

In his remarks earlier, the Managing Director of Banner Gas, one of the companies partnering with the State Government in the venture, Mr. Nuhu Yakubu, said the introduction of LPG, christened EKO Gas, was a demonstration of the State Government’s commitment to “Talk – to –Action”.

He said, “Before the year runs out, we are very sure and convinced that the Lagos State Government will have the course to commission more projects under the Energy programme of the State Ministry of Energy and Mineral Resources”, the Managing Director said adding that his company would be happy to have the Governor commission another Banner Gas- Eko Gas project powered by Banner Gas.

Four months ago, this kind of plant was launched in Surulere by the Lagos State Governor, Mr. Babatunde Fashola (SAN).