By Ndubuisi Micheal Obineme
Nigeria’s offgrid solar is set to increase drastically as the sector is attracting foreign companies, developers and investors to exploring the full potential of the Nigerian power sector.
During the 2017 edition of Powering Africa: Nigeria Summit held in Abuja, Solar is seen as the fastest growing alternative energy source in the world and is making a big impact in Nigerian energy mix.
Nigeria’s Minister of Power, Works & Housing, Babatunde Fashola said that the footprint of solar energy is increasing day-by-day in Nigeria as the country records more solar products in the market and it have triggered his ministry to start compiling the data of the variable numbers of solar products such as solar home systems, minigrids, offgrid installations and how much energy is consumed in Nigeria.
DEG, Director, Ragnar Gerig said Nigeria is in a similar situation with other African countries where there is a high need for electricity but state budgets are constrained not only on the commodity price but there are other things Government needs to put in place. He adds: “Basically, it is the right time to go for the private capital to invest in the sector. For instance, if you have 1GB of capacity, you can imagine that there is a lot of investment to be done. Today, we are in a situation that all these energy investments are only doable if you have a long-term finance. Otherwise, if you have to pay them off in a short-term, the tarrifs will be unaffordable for the people”.
He further explained that the longterm financing can only be brought in today by DFIs and other investors that can take a long-term view as it is often not investors who are coming directly from Nigeria. He adds: “If you ask investors to come from the outside, they want to be
sure that they are investing their money for a long-term, the investment environment should be conducive for them and all parties involved will keep the obligations based on the agreement established”.
He said the company faced some hook ups in previous years due to the economy situation in Nigeria but they are very optimistic that it will be resolved soonest and then there will be more solar projects launched in Nigeria in 2018.