3,000MW rural off-grid projects look promising as REA secures certification

The plan by the Rural Electrification Agency (REA) to boost off grid energy generation in rural areas received a boost as the Infrastructure Concession Regulatory Commission (ICRC), a government agency set up to bridge infrastructural gap and regulate Public Private Partnerships (PPP), is backing REA’s mini grid and solar home systems (SHS) projects, to increase electricity access for rural communities by 3000 megawatts (MW).

“We are glad to announce that the Infrastructure Concession and Regulatory Commission (ICRC) has issued the Rural Electrification Agency (REA) a Joint Outline and Full Business Case Compliance Certificate, having satisfied the provisions of the ICRC Act 2005 and the National Policy on Public Private Partnership (PPP) for the development of Hybrid Mini-Grids and Solar Home Systems in Rural Communities in Nigeria,” the REA said in a statement on its website.

With the compliance certificate the organisation can commence the process of awarding successful bidders of its tender last year the funds required to commence their projects.

On its significance, Ohiare said, “It implies that REA has followed due process and extant laws in selecting private partners to benefit from grants offered by the REF, and we can go ahead and implement the pilot 12 mini-grids and 20,000 Solar home systems advertised for a few months ago.”

In his opening remarks at a short ceremony to present the certificate to REA, the Chidi Izuwah, acting director general, ICRC, said “this is the 2nd Joint OBC & FBC Compliance Certificate issued to an organization”, as he pledged to support REA’s bid to provide access to reliable and renewable electric power supply for rural dwellers through appropriate tariff that is economically responsive and supportive of rural and unserved communities.

Sanusi Ohiare executive director, Rural Electrification Fund, who received the certificate on behalf of Damilola Ogunbiyi, MD-CEO of REA commended the efforts of the ICRC for their support in ensuring that the pilot long term PPP focused projects for rural electrification remained successful through the observation of all legal regulatory frameworks.

“Based upon an assessment and review of the proposal and all information available, this certificate confirms that the submission is in substantial compliance with the ICRC Act 2005, and the National Policy on Public Private Partnership,” the ICRC said in a Twitter post.

“In view of the fact that the mitigating conditions for the project may change over time, this certificate is valid for 12 months,” said the document signed by Chidi Izuwa, ICRC acting director general.

The REA has been on a drive to ramp up energy access in rural areas and underserved communities in Nigeria, a move that electricity distribution companies (DisCos) have kicked against on the ground that it is infringing on their franchise areas.

In June Enugu DisCo wrote the sector regulator the Nigerian Electricity Regulatory Commission (NERC), asking it to sanction companies supported by REA, whom they say are distributing power without acquiring a distribution license for that franchise area. NERC responded by issuing the organisations licenses and the matter has ended in court in a fight for right to serve the disputed franchise area.

Babatunde Fashola, on several occasions has said the DisCos are not granted exclusive rights to franchise areas and their license is subject to adequate distribution of power in those areas.

However, underserved communities would accept power from whoever can give them regular supply which is why traders at Sura market in Lagos are calling for off grid intervention due to poor supply. The REA who recently received a $350million loan from the World Bank may be poised to meet this need through mini grid developments with these ICRC certification.