Nigeria Secures $750 Million World Bank Loan for Solar Subsidy

Nigeria has taken a significant step towards enhancing its renewable energy sector by securing a $750 million loan from the World Bank.

The loan aims to provide subsidy to developers and operators of solar mini-grids in the country, thereby improving access to electricity for households and micro, small, and medium-sized enterprises (MSMEs).

The loan agreement was signed by the Minister of Finance, Wale Edun, and the World Bank’s Country Director for Nigeria, Shubham Chaudhuri, on March 31 and February 19, respectively.

The funds will be utilized to support the development and operation of privately owned and operated solar hybrid mini-grids in unserved and underserved areas.

The initiative will offer minimum subsidy tenders for developers and operators of isolated mini-grids, interconnected mini-grids, and solar rooftop solutions in participating states.

Additionally, performance-based grants will be provided to eligible mini-grid operators based on new customer connections and capital expenditures for interconnected mini-grid projects.

Furthermore, the loan will also support the expansion of standalone solar systems for households, MSMEs, and agribusinesses in rural areas.

The performance-based grants will be awarded to eligible companies to rapidly deploy solar solutions in underserved areas and support the deployment of solar productive use of electricity (PUE) equipment to MSMEs, agribusinesses, and commercial customers.

This initiative by the Nigerian government and the World Bank reflects a strong commitment to promoting renewable energy and addressing the energy needs of the country’s population.

By expanding access to electricity through solar mini-grids and standalone solar systems, Nigeria is taking a significant step towards achieving its sustainable development goals and improving the quality of life for its citizens.