AFD invests US$70m into Nigeria renewable energy fund

NIGERIA – French government, through the French Development Agency/Agence Francaise de Developpement (AFD), has granted Nigeria $70 million for the development of renewable energy and efficient energy projects in the West African country.

The finance will be disbursed to renewable energy developers through Access Bank Plc and United Bank for Africa (UBA).

Speaking at the recent Sustainable Use of Natural Resources and Energy Finance (SUNREF) Nigeria Programme investor conference, the Team Member of Project and Structured Finance, Sub Saharan Africa at Access Bank, Chukwudumije Igwe said: “SUNREF is a fund that has been made available by AFD to back renewable and energy-efficiency projects.”

“The total size of the fund is US70 million has been shared between Access Bank and UBA and we are looking for eligible projects to disburse this fund too. We know that a lot of the SUNREF projects are power and renewable projects and we know how critical infrastructure is to Nigeria and the federal government cannot do it alone,” added Chukwudumije Igwe. 

Around 80 million Nigerians have no access to electricity and the finance provided by France is expected to boost investment into Nigeria’s renewable energy sector and help improve energy access. 

According to the SUNREF Nigeria Team Lead, Mr. Javier Betancourt, approximately 14GW of new energy generation capacity, and an investment of about US$10 billion would be required to bridge Nigeria’s energy gap.

“US$70 million 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 said.

“What Nigeria needs is in the billions because over 80 million people in Nigeria are completely unelectrified while the remaining 100 million are somewhat electrified. The investment needed is enormous. US$70 million does not even begin to cover it, but it does help start things,” Betancourt added.

The Minister of Industry, Trade and Investment, Otuba Adeniyi Adebayo, added that the rapid population growth and increase in industrial activities had led to a significant increase in energy consumption, resulting in an increase in environmental pollution and economic difficulties. “Renewable energy provides access to alternative sources of energy that are more sustainable and reduce dependence on fossil fuels,” he said.