Displacing petrol and diesel generators with solar in Nigeria

Objectives

Across Sub-Saharan Africa, the national electricity grid delivers power supply to a fraction of its population, with frequent power blackouts.Most households and businesses are forcedto rely on expensive and polluting petrol anddiesel generators as backup to an unreliablegrid. Nigeria alone relies on tens of millions ofgenerators for this purpose.

In 2022, Sustainable Energy for All (SEforALL)launched a funding round in Nigeria to helpdisplace these generators with equivalentsolar-battery systems, through the UniversalEnergy Facility (UEF), the multi-donor results-based financing (RBF) facility that we manage onbehalf of a coalition of partners. The ‘Stand-AloneSolar for Productive Use’ (SSPU) programmepursues aligned objectives on energy access,climate change and development, providingclean and affordable energy to households andsmall businesses whilst also fast-tracking thedisplacement of gasoline and diesel generators,and promoting job creation and economicproductivity.

Partners

The Universal Energy Facility was established bySEforALL with a coalition of partners includingThe Rockefeller Foundation, UKaid, USAID, GIZ,Shell Foundation, Good Energies Foundation, theCarbon Trust, and the Africa Minigrid DevelopersAssociation. The Facility’s SSPU programme issupported by the Global Energy Alliance forPeople and Planet (GEAPP), IKEA Foundationand Rockefeller Foundation. The fund relies on adigital payments platform that was developed inpartnership with Odyssey Energy Solutions. ForSSPU funding, the Facility works with a range ofqualified renewable energy companies active inthe Nigerian market.

Technologies

Our project supports 100% solar and batteryenergy storage solutions with the capacity toreplace gasoline and diesel generators on a one-for-one basis.

Our Role

SEforALL acts as the programme and fundmanager for the UEF. We worked to developthe standard operating procedures for thefund, and to build partnerships with renewableenergy associations in Nigeria and across Africa(the UEF is active in five countries at the timeof writing). We coordinated with a communityof donors and practitioners of results-basedfinancing through an ‘RBF Leadership Group’and consulted on the design and development ofthe fund’s implementation framework. Togetherwith our partners, SEforALL mobilized a firstround of funding of USD 10 million to supportten renewable energy companies to deploy over3,500 electricity connections in Nigeria.

Results

The SSPU programme’s 2022 launch in Nigeriaimmediately received applications from qualifiedproject developers to deliver over 25,000 solarbattery connections to customers, displacing thousands of backup generators and avoidingover 33,000 tonnes of carbon dioxide equivalent(tCO2e) greenhouse gas emissions per annum.

In February 2023, we signed grant agreementswith ten of these companies for a total of USD10 million in grant funding available, leavingan immediate opportunity to fund a further 20qualified companies on a ‘wait-list’ with viablesolar projects that could deliver an additional22,000 new electricity connections within thenext two years.

Next Steps

SEforALL is working with its partners to mobilize additional funding to enablethe expansion of the SSPU programme in Nigeria and additional countries(exploring Indonesia and Uganda). We are also working to explore ways thatthe UEF can channel climate finance to decentralized renewables and cleancooking, for example through carbon markets finance and generation ofRenewable Energy Certificates.

"The Universal Energy Facility helps us supply power to ruralcommunities, especially to female traders and to health centres.It can be quite expensive for companies and individuals to havesolar installed, and the UEF’s grant funding allows us to reduce the up-front costs to people."
— SALEWA ISAAC, PAM Africa, a Nigerian project developer.

‍