The Bank of Industry (BoI) has boosted the size of its Solar Energy Fund to N6 billion, according to a statement on its website.

The BoI said that the Fund was reviewed upwards to enable various categories of end users (commercial and residential) to acquire reliable solar solutions.

The Fund was first launched in 2017 in the form of an N1 billion Solar Energy Fund for micro, small and medium enterprises (MSMEs). The aim was to help address the challenges in Nigeria’s power sector.

N6 billion Fund details: Having increased the Fund’s size to N6 billion, the BoI said the target market now includes households and businesses (agribusiness, solid minerals, artisans, service and hospitality industries), project developers (providing solar solutions for residential estates, educational facilities, healthcare facilities) and deposit money banks (DMBs)/micro-finance banks (MFBs).

The funds can be accessed directly from BOI or indirectly through Deposit Money Banks (DMBs) or Microfinance Banks (MFBs) by end users or solar energy companies.

Funding structure: The Fund specifies a maximum of N350 million per end-user. Funds for micro-users requiring less than N5 million per user will be disbursed under an on-lending arrangement with DMBs or MFBs. For new small and medium enterprises (SMEs) and large enterprises (LEs), mini–users requiring between N5 million – N20 million per end user and standard users requiring between N20 million – N350 million per end user, will access funds through direct lending from BoI. The limit for solar energy developers shall be between N20m –N350m.

Projected Impact: The BoI says it expects the fund implementation to lead to a cleaner and healthier environment from reliable and sustainable energy sources. A reduction in greenhouse gas emissions from utilizing fossil fuels, thereby contributing to climate change mitigation as well as boosting inclusive economic growth and development.

Off-grid market: According to Heinrich Boll Stiftung, Nigeria’s off-grid market for mini-grids and solar home systems is estimated to yield $10 billion annually in revenue and savings of $6 billion for Nigerian homes and businesses. The global off-grid market report says that Nigeria is the 5th largest market in terms of the volume of solar products sold. Sales of off-grid solar systems, increased by more than double in value from $23 million in 2018 to $63 million in 2019. Adding related products, the total import value is closer to $150 million.

For the record: In August 2022, the Chief Executive of BoI, Mr Olukayode Pitan, said the bank accessed a €100 million (N42.20 billion) line of credit under the Transforming Financial Systems for Climate (TFSC) programme in collaboration with the Green Climate Fund (GCF).

According to him, the money would be used to support low-emission transition in Nigeria and finance investments that support climate change adaptation and mitigation measures.