Despite the many low points associated with the outgoing government in Nigeria regarding the development and management of the country’s economy, what happened in the off-grid energy space shows that there is a lot of potential in other sectors if the right steps are taken. Taken with proper investment, government support and smart regulation.
We have always insisted that the private sector should be allowed to play a leading role while the government supports it through smart regulations for growth and development in the economy. What happened in the off-grid energy space is a testament to this, not only confirming our position, but also showing what can happen when talented people are empowered to act.
When this government first came to power on May 29, 2015, the previous government had already launched the National Renewable and Energy Efficiency Policy (NREEEP), a blueprint for sustainable development, distribution and utilization of renewable energy resources. Economics for On-Grid and Off-Grid. The Buhari government accepted this blueprint.
Under NREEEP, there was a provision of complete tariff waiver for all solar utility components (panels, TV, batteries, bulbs) to attract investments, create downstream jobs and build scale. It established preferential clearance at ports for the above as observed with Kenya and Ghana for ease of doing business.
In 2016, the Nigerian Electricity Regulatory Commission, the Nigerian Electricity Regulatory Commission (NERC) developed a mini-grid regulation that provides guidance on the operations of mini-grids in Nigeria. A small amount.
This regulation has become a game changer in providing energy access to previously underserved communities. Soon after the regulation was enacted, investors began to take advantage of cost recovery in the tariff model and provisions allowing optional licensing of power systems below 1MW. This regulation has helped spur hundreds of new businesses and created thousands of jobs in the off-grid space. It also prioritized solar mini-grid applications at NERC.
Another interesting policy implemented by this government is the development of national content for power sector regulation aimed at encouraging the deliberate use of local human resources and material resources throughout the value chain of the Nigerian Electricity Supply Industry (NESI).
The policy empowers the NESI Nigerian Content Consultative Forum (NNCCF) to carry out periodic surveys to determine national content participation in the sector. It is also provided to specify the contribution of women in local content regulation quotas for jobs across NESI.
Perhaps, the Nigerian Electrification Project (NEP), is a federal government credit facility initiative driven by the private sector that seeks to provide electricity access to off-grid households, micro, small and medium enterprises (MSMEs). communities across the country through renewable energy sources.
The NEP is being implemented by the Rural Electrification Agency (REA) in collaboration with the World Bank, AfDB and other partners. The scheme has increased access to electricity for households and MSMEs. It has helped provide clean, safe, reliable and affordable electricity to unserved and underserved rural communities through renewable energy sources. It has developed a data-driven off-grid model for Nigeria that could become a model for sub-Saharan Africa.
The project aims to provide reliable electricity to 250,000 MSMEs and one million households. Already, aspects of the project have led to the provision of solar-powered electricity to universities, markets and hospitals across the country.
Also Read: REA to Build 1000 Mini-Grids for Off-Grid Communities
The Solar Power Naija project to support economic recovery in response to the Covid-19 pandemic is the latest policy initiative operators are excited about. As part of the Economic Sustainability Program (ESP), the federal government has launched an initiative to build 5 million new solar-based connections in off-grid communities.
The solar connectivity intervention facility will complement the Federal Government’s efforts to provide affordable electricity by providing long-term low-interest credit facilities to pre-eligible domestic solar value chain players under the Nigeria Electrification Program (NEP). Individuals (5 million new connections) through solar home systems (SHS) or mini-grid connection, increase local content in the off-grid solar value chain and facilitate and encourage the development of the local manufacturing sector 250,000 new jobs in the energy sector.
Allowing private sector operators has opened up the sector to boost energy in underserved communities, develop forward-looking policies with development partners, seed new businesses with grants to investors like All On, and hire talent. Manage the process.
All these, in our view, are enablers of economic growth, which is why we urge the government to replicate this success in other sectors of the economy.
