Solar Energy: Building positive partnerships for rural development

12 November 2015, Lagos – The collaboration between the Bank of Industry (BoI) and the United Nations Development Programme (UNDP) to scale up rural development through provision of solar and renewable energy received a boost recently to enhance Nigeria’s growth process. Paul Obi writes

Solar--panel (1)With the new push for rural development, Nigeria is faced with several challenges on how to initiate developmental projects that tackle many problems at the rural area. Chief among these challenges include poverty, illiteracy and poor standard of living. One pragmatic way of tackling these challenges is on access and availability of energy.

Budding Partners
With energy, rural dwellers can afford to address poor economic indexes, engage in productive ventures and improve their standard of living. It is within this scope that the Bank of Industry (BoI) and the United Nations Development Programme (UNDP) are teaming up to provide not just an enabling environment but also initiate solar and renewable energy projects that would impact on the daily economic activities of rural communities.

Within the last count, BoI have unveiled such projects in Niger, Gombe, Plateau, Osun States among others. At the unveiling of the 24kW micro – grid solar solution in Idi-ita/Onibambu communities in Ife North Local Government Area of Osun State, Managing Director, BoI, Rasheed Olaoluwa said the push to intervene in the provision of solar solutions across rural communities is crucial in reviving the rural economy.

According to Olaoluwa, “it is a well known fact that Nigeria’s current electricity situation is unsatisfactory, with the total electricity supply from our national grid just peaking above 4500MW in recent months. Relative to the electricity demand conservatively estimated at 40,000MW, this is grossly inadequate for a leading African economy like Nigeria with a population of 170 million people.”

Electricity Component
Explaining further, Olaoluwa observed that electricity remains a key component of economic sustainability. He argued that “worse hit are the rural communities, especially the off-grid areas which have always been without electricity and have resigned their fate to the use of kerosene lanterns, oil lamps, and other types of dangerous and unhealthy sources of light to be able to live their daily lives. This is one of the main factors responsible for the concept of rural-urban migration.”

In his view, “the central power generation, transmission and distribution system operational in the country can no longer deliver competitive, cheap and reliable electricity to remote customers through the national grid. Rather than wait in vain for the national grid to reach these areas, we should explore the golden opportunity that renewable energy presents for the provision of clean, affordable and sustainable energy for our rural communities.”

Renewable Energy
Further, officials at BoI/UNDP expressed belief that renewable energy such as hydro, wind and solar are increasingly becoming relevant and commercially driven where they are now being embraced in a global scale.

The BoI MD stressed that “the critical role of renewable energy was re-emphasised at the G7 summit which held in June, 2015,where the leading industrial nations agreed to decarbonise the global economy by phasing out the use of fossil fuels by the end of this century, i.e. over the next 85 years.

Olaoluwa further stated that “global investment  in solar energy increased by 20 per cent to $149.6 billion in 2014, with China, USA, Japan, India and Brazil leading in that order. In the USA, the leading solar energy company, Solarcity, has installed over 500,000 solar home systems. A new home is switched to Solarcity every three minutes. Simpa Networks in India, and M-Kopa in Kenya, have introduced the ‘Pay-As-You-Go’ pre-paid technology in their offering of off-grid rural solar home systems.”

PAYG Technology
According to the bank, the Pay-as-You-Go (PAYG) technology is today seen as the magic wand required in the telecommunications industry to scale up and expedite rapid growth in GSM subscription across Africa over the last decade and a half.

This, in turn would have a ripple effect on the economy. For instance, the bank MD cited East Africa as a good example, “already leading the way for sub-Saharan Africa. M-kopa, subsidiary of Kenya telecoms giant, Safaricom, has installed the solar home systems in over 180,000 rural homes in Kenya, Tanzania and Uganda.”

He added that “there is a developmental imperative for us in Nigeria to also employ the PAYG magic wand in solving the electricity crises by replicating this model in Nigeria. We are starting off with the provision of long-term financing for the installation of off-grid solar home systems in six communities in a pilot phase, as part of our Solar Energy Partnership with the UNDP.

“These communities, with an average of 200 homes each, are located in Anambra, Edo, Gombe, Kaduna, Niger and Osun States. Today, we have come to Osun State in partnership with Arnergy Solar Limited to unveil a 24kW micro-grid solar electrification system in Idi-ita/Onibambu, a community which hitherto had no access to electricity”, he added.

Solar Systems
Arnergy Solar Limited, the project developer, Arnergy Solar Limited specialises in the provision of clean energy to customers at the Bottom of the Pyramid (BotP).  The company has implemented stand-alone PV solar systems in communities in Lagos and Ogun States.

To this end, the bank provided the sum of N44.0 million to Arnergy Solar Limited for the deployment of a micro-grid solar system in Idi-ita/Onibambu. We intend to replicate the project in other such communities in Osun as well as other parts of the country upon successful implementation of this pilot scheme.”

In the same token, the bank’s target is to see that “each home will have sufficient solar electricity to power three (3) LED light bulbs, 1 electric fan, 1 radio/TV set and of course, mobile phone charging. These are the basic energy needs of an average rural family. What we have initiated today, is a commercially sound model for delivering power to Nigerian rural homes at affordable rates, to provide a long-term alternative to the problematic national grid.

“In early October to be precise, a similar 24kW micro-grid solar electrification project was unveiled in another off-grid community at Bisanti, which is located in Katcha LGA of Niger State. We shall also be replicating these projects over the next few months in four (4) additional off-grid communities located at Ogbekpen in Ikpoba Okha LGA of Edo State, Kolwa in Kaltungo LGA of Gombe State, Onono in Anambra West LGA of Anambra State and Carwa/Cakum in Markarfi LGA of Kaduna State.

“We want our rural communities to take control of their energy generation and to pay for only the energy used. Our medium term vision is to have 100,000 homes installed with solar systems in the next five years, through a combination of micro-grid and stand-alone solar home systems. This is essentially a programme aimed at poverty alleviation and rural economic development, and we are ready to partner the State Government and other stakeholders to replicate this project being unveiled in Idi-ita/Onibambu today, in other off-grid communities within the State.”

Promoting Sustainability
However, an environmentalist, Dr. Patrick Tolani stated that the project would accelerate the pace of self-sustainable economic activities and stem the tide of deforestation occasioned by felling of trees to generate energy. He said preliminary studies carried out by Community Energy Africa had revealed that the project was also capable of offsetting thousands of carbons per year.

“A cursory look at this community will no doubt reveal that the people depend wholly on woods and kerosine for their energy needs. In this case, they rely on trees, which they constantly cut down for domestic use, causing deforestation with its attendant consequences on the lives of the people and the environment. Having a project like this will offset carbon that goes to the environment”, he added.

Regarding sustainability of the projects, Tolani who is also the CEO, Charity Aid and Development Foundation for Africa, opined that apart from the fact that GVE, the project contractor would be available to provide stand-on assistance in the engineering aspect, the most viable way to make it enduring was through community ownership.

“However, it is also important we make the community part of the project so that they see it as their own. We are looking at the opportunity of issuing shares to members of the community so that they can have share ownership, and not just that, shared posterity. If we are able to work that out, when there is profit, they will get dividend”, Tolani stressed.

Speaking in the same vein, the Managing Director, GVE Project Limited, Ifeanyi Orajaka, observed that the project would help the beneficiaries to conserve money, adding that the cost of purchasing kerosine lamp, candles and generators was capable of constituting a strain on the pocket of ordinary people.

The combination of BoI and UNDP synergy in taking a lead in the provision of solar and renewable energy all add up to create hope for economic sustainability. Affordable energy, in the views of the promoters, is necessary for economic revival, particularly, in the rural areas.

The plight with such lofty ideas associated with high-tech technology as solar solutions is that locals barely have the technical know-how to manage such sophisticated infrastructure. Also, maintenance of such amenities is costly and demanding. As crucial as solar energy is to address inadequate supply of energy across Nigeria’s rural communities, the identified gaps must also be addressed. That is the way to make the micro – grid solar project wholesome.

“The combination of BoI and UNDP synergy in taking a lead in the provision of solar and renewable energy all add up to create hope for economic sustainability. Affordable energy, in the views of the promoters, is necessary for economic revival, particularly, in the rural areas”

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