Acting managing director of The Bank of Industry (BoI), Mr. Waheed Olagunju has given more insights on why the federal agency launched its N1-billion solar energy fund.
In an interview in Lagos, he said the scheme is designed to boost off-grid electricity generation project with special target on rural residents.
He further disclosed that the facility would be made available to firms partnering with the bank in the development of solar energy services across the country.
The fund coming as a concessional financing initiated by the bank as a result of poor cash floor in the rural areas, according to Olagunju will assist operators of Micro, Small and Medium Enterprises, MSMEs, to boost their production and make them competitive using the power source.
Olagunju added that the initiative will help reduce cost of business, as current study shows that alternative power source costs 40 percent of expenditure by the manufacturing sector.
Already, BoI has spent about N240 million for six pilot solar projects in the geo-political zones of the country in 2016.
Many Nigerians and Nigerian businesses that can afford other alternative energy sources have resorted to the use of electric generators at exorbitant costs as it was estimated that in 2015, manufacturers spent as much as N3.5trillion to generate alternative power due to the challenges in the supply of public electricity.
BoI boss also noted that the cost of electricity accounts for about 40 percent of operational expenses for most MSMEs, resulting in reduced profit margins, uncompetitive and generally unsustainable ventures.
In his submission, “For Nigeria to therefore achieve sustainable and inclusive development, there is an urgent need to substantially increase the supply of modern and affordable energy services from sources that are affordable, accessible and environmentally friendly.
“A robust mix of energy sources combined with an improved end-use efficiency, would be required to meet the country’s energy needs, and this is where the utilization of renewable energy sources come into play.
“The Bank is already playing an active role in Lighting up and powering Nigeria through the provision of solar energy solutions for rural communities, having successfully deployed solar solutions worth N240 million to six (6) off-grid communities, one (1) each in Niger, Osun, Gombe, Anambra, Edo and Kaduna States, under its pilot scheme.
It is believed that communities with an average of 200 homes each which previously had no access to electricity can now make do with the project in the delivery of clean, reliable and sustainable solar electricity.
