Nigeria needs $23bn to fix power sector — REA boss

Nigeria's electricity sector requires $23 billion in additional investment to meet growing demand and improve reliability, according to the Rural Electrification Agency (REA) Managing Director, Abba Aliyu. Speaking during a collaboration agreement signing between the REA and Alpha Morgan Bank, Aliyu warned that the country's electricity challenge could worsen due to factors such as population growth and increased demand from industries like transportation, healthcare, and education.

The REA and Alpha Morgan Bank have committed up to $50 billion in financing for renewable energy developers, with the bank providing up to 70% counterpart funding for eligible projects. However, Aliyu emphasized that this amount represents only a small fraction of the funds needed to address Nigeria's electricity deficit, which he estimated to be around $23 billion.

He highlighted that reliable and affordable power would become a strategic economic advantage, particularly as the world shifts towards renewable energy sources like solar and battery storage. Aliyu also discussed Nigeria's renewable energy initiatives, including the President Bola Tinubu-approved $750 million program to deploy 1,350 mini-grids and expand electricity access to 2.5 million Nigerians.

Despite these efforts, he stressed that the available financing remains inadequate, with less than $2.5 billion currently available. To support the deployment of interconnected and isolated mini-grids, Aliyu announced that the REA had secured an additional $119 million in financing from the Japan International Cooperation Agency.

He also introduced the Renewable Energy Asset Management Company, which aims to become Africa's largest renewable energy asset holder and help leverage existing assets to attract fresh private-sector financing.