The African Development Bank (AfDB) has approved a $500,000 grant to support the development of clean energy in Nigeria.
A statement issued by the bank on Friday said the grant was approved under the AfDB’s Sustainable Energy Fund for Africa (SEFA).
SEFA is a multi-donor facility established to unlock private sector investments in small to medium-sized clean energy projects in Africa
The statement quoted Wale Shonibare (pictured), the bank’s acting vice-president for power, energy, climate change and green growth, as saying the grant would also support the launch of the Nigeria Energy Access Fund (NEAF).
NEAF is a new private equity fund developed by `All On’, a Nigerian impact investment firm financed by Shell.
According to Shonibare, NEAF would make strategic investments in sustainable energy in Nigeria, particularly in the country’s burgeoning off-grid and mini-grid sectors.
“NEAF will be a first-of-its-kind facility to provide eligible projects and businesses with equity solutions that are currently unavailable in the market,” he said.
“Nigeria requires bespoke and innovative market-based solutions to provide its off-grid population, estimated at 100 million, access to sustainable sources of energy.
“The SEFA grant will be instrumental in the constitution of NEAF, and ultimately, the mobilisation of much-needed private sector investment for clean energy.
“The grant will support specific work streams to set NEAF in motion and enhance its engagement with private and public sector investors.
“Once operational, NEAF is expected to complement the bank’s wide range of sustainable energy initiatives currently being implemented in Nigeria.”
He added that SEFA’s support to NEAF was aligned with the new deal on energy for Africa and the bank’s priorities, especially ‘Light Up and Power Africa.
NAN reports that the project, which conforms with AfDB’s energy sector strategy, is expected to boost Nigeria’s power sector recovery plans.
In November 2018, AfDB’s board of directors of the bank approved a $200 million package to support the Nigeria Electrification Project (NEP), designed to help scale-up green mini-grid solutions with subsidies.