Pan Africa Solar and the Federal Government have jointly signed Nigeria’s first Solar Power Purchase Agreement (PPA), in a move, which could be termed utility-scale solar revolution.
The 75MW solar photovoltaic power project in Katsina State, with a total investment of $146m, will sell power for a tariff of $11.5 cents per kWh and will be commissioned in 2017.
Vice President, Prof. Yemi Osinbajo, who was the special guest of honour at the agreement signing ceremony at the office of the Nigeria Bulk Energy Trader (NBET), was represented by Mrs. Lolade Abiola, of Sector Lead Solar and Access Advisory Power Team, Office of the Vice President.
The 75MW solar project, once commissioned will be the largest of its type in the Sub-Saharan Africa (excluding South Africa) and will provide power for 1.1 million Nigerians. Not only that, it will also generate over 500 employment opportunities for local people during the 12-month construction period. It is also estimated that 40, 000 new jobs will be created from the additional economic activities stimulated by the power plant.
Chief Executive Officer (CEO), Pan Africa Solar, Mr. Marcus Heal, said: “We are delighted that the Federal Ministry of Power is pushing ahead with its solar energy policy. This tariff has been achieved through harnessing lower construction and lower solar panel prices and the commitments of the project’s lender”.
Corroborating Heal’s remarks, Justin Woodward of JCM Capital, a Canadian private equity firm who are co-developers in the project said: “This is the start of a solar revolution in Nigeria.”
Pan Africa Solar is developing a 1,000 MW portfolio of solar projects in the country and plans to bring in more than $1 billion worth of investment over the next five years.
Joining Pan Africa Solar and JCM Capital in the sponsor group for the project includes the African Finance Corporation (AFC). The FMO are the lead arrangers of debt raised from the development finance institutions that includes DEG and Proparco. The project is also receiving support from the World Bank, Power Africa and MIGA, the company said.
