250 MW of Decentralized Renewable Energy Projects
The Rural Electrification Agency (REA) is partnering with Husk Power Systems to deliver electricity to over 20 million Nigerians through new solar and mini-grid projects. This major collaboration will develop up to 250 MW of decentralized renewable energy (DRE) projects, including mini-grids, rooftop solar installations, and other energy initiatives.
Formalized through a memorandum of understanding (MoU), this partnership directly supports the Nigerian government’s energy access and transition goals.
Image: Collected
The collaboration will focus on various DRE projects in rural and peri-urban areas. Key initiatives include power generation and distribution through interconnected and isolated mini-grids, rooftop commercial and industrial (C&I) solar projects, productive use of energy (PUE) programs, appliance sales, and integrated financial solutions.
These projects are designed to support the $750 million Distributed Access through Renewable Energy Scale-up (DARES) initiative, which is backed by the World Bank and managed by the REA. The program is set to begin later this year.
World Bank Support
Speaking at the ARE Energy Access Investment Forum (EAIF) 2024 in Lagos, Abba Aliyu, Acting Director and Chief Executive of REA, confirmed that the agency is leveraging the $750 million World Bank-endorsed project to supply electricity to 20.1 million Nigerians.
The loan was facilitated through the International Development Association (IDA), the World Bank’s division that provides funding to the world’s most impoverished nations.
Aliyu outlined an ambitious strategy to extend electricity to millions. This initiative aims to electrify three million individuals through isolated mini-grids, connect 1.5 million via interconnected mini-grids, and provide approximately 15.6 million with solar home systems and mesh grids.
Notably, the federal government, under President Bola Tinubu’s leadership, has approved this groundbreaking $750 million off-grid initiative—the largest publicly funded project of its kind globally. This significant funding will act as a capital subsidy, encouraging private sector participation to electrify the 23% of Nigeria’s population currently without access to power.
Rural Electrification Fund
Aliyu also noted that the Rural Electrification Fund (REF), sourced from the energy market, is being used to implement the new Energy Act in partnership with state governments. Through this collaboration, REA encourages states to contribute 30 percent in counterpart funding, while REA provides 17 percent for projects like mini-grids, solar home systems, or productive equipment within the state. This represents the second phase of the REA’s intervention, which focuses on developing replicable models based on field data and experience.
He also highlighted a separate $550 million rural electrification project, funded by the World Bank and the African Development Bank (AfDB), as a key government effort to address Nigeria’s significant electricity gap. This initiative has introduced a resource-based financing framework to attract private sector investment.
Furthering its mission, the REA has already mobilized significant private sector capital through this project, deploying over 150 mini-grids nationwide. These installations include around 100 in healthcare facilities. Additionally, the federal government, led by the Minister of Power, will soon begin commissioning high-impact projects that will benefit over 350,000 students across 15 universities.
Collectively, these initiatives will enhance energy access, promote sustainable economic development, and support Nigeria’s energy transition. The $750 million DARES project will stimulate private sector involvement, while the $550 million rural electrification project will continue deploying solar mini-grids in critical sectors like healthcare, education, and agriculture, showcasing the government’s firm commitment to closing the nation’s electricity gap.
