- The implementation of REA programs should be decentralised and handled by rural electrification institutions and within state electricity laws.
- Adelabu calls for stakeholder engagement in repositioning Nigeria’s energy landscape.
Last week, at a stakeholder roundtable hosted by the Rural Electrification Agency (REA), states demanded decentralisation in implementing the federal government’s rural electrification programs.
The just-concluded two-day stakeholder engagement event, held on the 27th and 28th of February 2024 with states and Electricity Distribution Companies (DisCos), was in preparation for implementing the World Bank-funded Distributed Access through Renewable Energy Scale-up (DARES) program.
The roundtable discussion, supported by EY-USAID, hosted experts from different states, DisCos and public and private organisations, including the minister of power, Adebayo Adelabu.
In his opening remarks, Adelabu stressed the need for stakeholders’ collaborative efforts in the public and private sectors. According to him, this hinges on repositioning the nation’s energy landscape.
Furthermore, he urged stakeholders to explore innovative public-private partnership models that leverage the strengths of each stakeholder.
According to him, this could be in financing, technology, or operational expertise, adding that these partnerships are not just transactions but the lifeline of Nigeria’s energy ecosystem.
During the event, the experts analysed critical issues centred around implementing sustainable energy access nationwide, leveraging the 2023 Electricity Act.
According to a LinkedIn post by an energy expert, Odion Omonfoman, the states advised the federal government, development finance institutions, donor partners, project developers, REA, as well as other stakeholders on the following:
- The Electricity Act 2023 recognises the residual nature of rural electrification, which is subject to state laws. Hence, Sections 152 and 153 of the Electricity Act mandate the REA to collaborate with sub-national governments to implement its rural electrification programs within states. Consequently, implementing rural electrification programs should be within state electricity laws. This means the licensing and regulations for mini-grids and so on will now be under the State Electricity Regulatory Commission (SERC), not the Nigerian Electricity Regulatory Commission (NERC).
- The implementation of REA programs should be decentralised and handled by rural electrification institutions at state levels (similar to the RE programs in India). A decentralised implementation approach would deliver more sustainable rural electrification projects and reduce overall implementation costs. States requested that the REA should provide technical assistance and capacity building for state rural electrification institutions.
- Given the lack of public resources, rural electrification programs should primarily focus on more productive use of electricity and demand growth within underserved and unserved communities rather than the number of new connections. States suggested that site selection criteria for mini-grids could include having at least two Small and Medium Enterprises and/or government/public institution(s) within the community as anchor customers. This strategy will also improve the sustainability of renewable energy projects and make them less dependent on DFI funding.
More About the DARES Project
The DARES project is a World Bank-funded program aimed at distributing renewable energy across rural areas in Nigeria. On December 14, 2023, the World Bank approved the Nigeria DARES project.
The project, financed by an International Development Association (IDA) credit of $750 million, will leverage over $1 billion of private capital and significant parallel financing from development partners.
This includes $100 million from the Global Energy Alliance for People and Planet (GEAPP) and $200 million from the Japan International Cooperation Agency (JICA).
Other development partners collaborating on the program include the United States Agency for International Development (USAID), the German Development Agency (GIZ), Sustainable Energy for All (SEforAll), and the African Development Bank (AfDB).
This program aims to provide over 17.5 million Nigerians with new or improved access to electricity through distributed renewable energy solutions. The DARES project will use innovative financing solutions to scale up private sector-led clean electricity provision in Nigeria.
The DARES project will enable the federal government to coordinate and finance all off-grid electrification efforts. It will help states access technical assistance to develop institutional capacity and policy frameworks for rooftop solar.
In addition, the program will prioritise gender and inclusion by building on the Nigeria Electrification Project’s gender-related actions to facilitate access to electricity for disadvantaged female-headed households and women-led MSMEs, as well as actions to increase women’s employment in the energy sector.