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FG explores renewable energy to achieve 30GW grid capacity by 2030

By Femi Adekoya
27 October 2021   |   4:06 am
The Federal Government has announced plans to deploy 30 per cent of renewable energy technology to grid power capacity by 2030.

Adebayo

The Federal Government has announced plans to deploy 30 per cent of renewable energy technology to grid power capacity by 2030.

The Minister of Industry, Trade and Investment, Niyi Adebayo, explained that the move is in line with the federal government’s plan to increase the current capacity of 5GW to 30GW in the next nine years.

The Minister, who was represented by the Deputy Director, Industrial Development, John Opaluwa, at the second edition of Sustainable Use of Natural Resources and Energy Finance (SUNREF) Nigeria Programme investor conference, assured that the ministry had been making efforts to attract investors into the country to boost industrial activities and achieve economic growth.

“We will bring renewable energy efficiency innovators to interface with potential investors and financiers into the sector. We are encouraging organisations and companies to adopt and invest in technological innovations to meet global best practices,” he said.

He added that the benefits of investing in renewable energy and energy efficiency cannot be overemphasised, stating the need to give the sector serious consideration.

According to him, renewable energy provides access to alternative sources of energy that are more sustainable and reduce dependence on fossil fuels, saying that rapid population growth and increase in industrial activities have led to a significant increase in energy consumption resulting in increase in environmental pollution and economic difficulties.

He stated the need for economic managers to prioritize substantial investment into the implementation of the renewable energy solutions and energy efficiency measures.

Also speaking, the Team Member, Project and Structured Finance, sub-Saharan Africa, Access Bank, Chukwudumije Igwe, said the SUNREF would sponsor projects that are innovative, meets technical eligibility, energy efficient and renewable.

In his words: “SUNREF is a fund that has been made available by Agence Française de Développement (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 and has been shared between Access Bank and UBA. We are also looking for eligible projects to disburse this fund to.”
We know that a lot of the SUNREF projects are power and renewable projects and we know how critical infrastructure is to Nigeria and we know 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.”

Also speaking, the Team Lead, SUNREF Nigeria, Javier Betancourt, said the renewable sector has so far remained forgotten by financiers but becoming a more important subject matter, saying that this is why banks are becoming more involved in the sector.

“The $70 million is largely not enough but a start. What Nigeria needs is in the billions because over 80 million people in Nigeria are completely out of electricity while the remaining 100 million are somewhat electrified. The investment needed is enormous. $70 million does not even begin to cover it, but it does help start things,” he said.

He said access to finance to fund renewable energy projects requires long term financing that is not available in the country.

“This fund we are bringing in will be longer terms with a minimum of five years and these are concessional lending rates which would help to finance these projects. It is difficult to give an exact approximation on the amount needed by the renewable sector to bridge the nation’s energy needs, but just because Nigeria needs another 14GW of energy, the investment required would be about $10 billion in total.

“It is a drop in the ocean, but it is an important drop because it will help move this sector to get the appropriate finance,” he added.