The Federal Government, Sterling Bank, one of Nigeria’s foremost lenders, and Virtus Energy Solutions Limited are partnering to enhance power production for small businesses in Nigeria.
The Managing Director/Chief Executive Officer, Rural Electrification Agency, Damilola Ogunbiyi, said the project would provide electricity access to over 80,000 shops across 16 economic clusters, empower over 340,000 micro, small and medium size enterprises, create over 2,500 jobs while serving over 18 million Nigerians.
“This is a significant milestone in the financing of the Energizing Economies Initiative. Since the deployment of off grid electricity solutions at various markets across the country, we are already witnessing positive environmental and economic impacts. This is the sort of intervention we look forward to scaling across Nigeria with support from financial institutions,” he said.
Ogunbiyi said FGN, through the Rural Electrification Agency, was implementing the Energizing Economies Initiative (EEI), which supports the rapid deployment of off grid electricity solutions to provide clean, safe, affordable and reliable electricity to economic clusters (e.g., market places, shopping centres, industrial facilities) through private sector developers.
The REA worked in collaboration with the USAID sponsored programme, Power Africa. Power Africa provides technical advisory support to this initiative, which is already transforming businesses in Sabon Gari market, Ariara market, Sura shopping complex and other economic clusters with sustainable, clean and affordable power supply by increasing economic activities, spurring business growth, fostering job creation and enhancing the business experience.
“Technical advisory is a key pillar of assistance Power Africa provides to Nigeria’s power sector. We are focused on ensuring initiatives like the Energizing Economies are designed and implemented with regulatory, legal, financial, transactional and project management support,” said the USAID/Nigeria Mission Director, Stephen Haykin.
The Central Bank of Nigeria (CBN) as part of its wider mandate towards ensuring economic development, productivity, macro-economic stability and economic diversification has shown commitment towards ensuring the successful implementation of the EEI. Unwavering support has been secured at the Bankers Committee level to support the proliferation of decentralised energy solutions.
On its part, Sterling Bank has been an industry leader in financing off-grid energy solutions through its multi-pronged approach aimed at ensuring the delivery of projects that provide electricity to communities and businesses and has extended a five-year facility worth N446 million to Virtus for the deployment of distributed energy solutions across selected economic clusters in Nigeria.
“At Sterling, we believe that the answer to power generation is a multiplicity of options and we want to be at the forefront of the commercialization of renewable energy. Our involvement in the Virtus transaction which provides N446 million in development financing demonstrates our commitment to improving the capacity of off grid private sector developers for power generation. We hope that this paves the way for more financing to the sector,” said the Managing Director, Sterling Bank, Abubakar Suleiman.
Virtus, a highly experienced decentralised energy consortium, sponsored by Rensource distributed energy and Solad, has a highly diversified cashflow stream from multiple markets. Virtus also has a strong team that spans hybrid power technologies, project management and execution, finance and digital technology and payments to ensure successful implementation of the projects. With the closing of this transaction, Virtus aims to deploy High Capacity Solar Systems to expand their coverage.
‘’This is indeed a significant achievement for Virtus that will further facilitate development financing in the renewable energy sector. It was only possible because government and the private sector collaborated to address financing challenges for off grid projects,’’ said the Managing Director, Rensource, Ademola Adesina.