Nigeria unveils $300m fund for off-grid power

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The Federal Government, through the Nigeria Sovereign Investment Authority, and its development partners have commercially launched a $300 million investment fund aimed at expanding off-grid electricity and distributed renewable energy projects across Nigeria.

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The Nigeria Distributed Renewable Energy Fund, jointly managed by the NSIA and Africa50, is expected to mobilise public and private capital for mini-grids, standalone solar systems and other decentralised electricity projects, particularly in communities and businesses underserved by the national grid.

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The NSIA, Africa50 and Sustainable Energy for All announced the commercial launch on the sidelines of the United Nations General Assembly, according to a statement issued by the NSIA on Monday.

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The partners said the launch marked the transition of the $300m fund from its structuring phase to active capital deployment, providing a dedicated financing platform for investments in Nigeria’s distributed renewable energy market.

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The initiative comes amid Nigeria’s persistent electricity supply deficit, which has forced millions of households and businesses to rely on generators and other alternative sources of power.

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According to the statement, the fund is aligned with Nigeria’s energy-access objectives and Mission 300, an initiative seeking to provide electricity access to 300 million people across Africa by 2030.

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It said, “The commercial launch signals growing market readiness and investor confidence in Nigeria’s distributed renewable energy sector.

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“The Fund represents an important step towards mobilising the scale of capital required to expand off-grid and distributed renewable energy solutions and reach communities and businesses that remain underserved by traditional energy infrastructure.”

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Distributed renewable energy projects typically generate electricity close to where it is consumed rather than depending exclusively on large central power plants and the national transmission network.

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The Managing Director and Chief Executive Officer, NSIA, Aminu Umar-Sadiq, described the commercial launch as a signal to investors about the potential of Nigeria’s renewable energy market.

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“This is a major development milestone. It is a strategic signal to markets, investors, governments and development partners that Nigeria’s distributed renewable energy market is investable, credible and ready to operate at scale,” Umar-Sadiq said.

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The fund is expected to support projects such as mini-grids and standalone solar systems as Nigeria attempts to close its electricity access gap while increasing investment in cleaner energy sources.

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The Group Chief Executive Officer, Africa50, Alain Ebobissé, said the structure brought together domestic expertise and international development financing.

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“What sets the Nigeria DRE Fund apart is the strength of the partnership: NSIA’s local market expertise, Africa50’s pan-African investment and fund management capabilities, SEforALL’s energy-access leadership, and the World Bank’s global energy thought leadership and catalytic capital,” he said.

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“Together, we are turning Nigeria’s energy needs into investable opportunities and building a model that can scale across Africa.”

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The World Bank is providing an initial $25m contribution through the International Development Association, representing about 8.3 per cent of the targeted $300m fund.

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The Managing Director of Operations at the World Bank Group, Anna Bjerde, said the investment vehicle was intended to combine development finance with private capital to expand electricity access.

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“Reliable and affordable energy is required for job creation and economic transformation in Africa, and the Nigeria DRE Platform contributes through a bold, collaborative approach needed to accelerate it,” Bjerde said.

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She added that the World Bank’s “initial $25m IDA contribution reflects our commitment to bridging funding sources and delivering real connections to people and communities across the continent.”

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The Chief Executive Officer, SEforALL and Special Representative of the United Nations Secretary-General for Sustainable Energy for All, Damilola Ogunbiyi, said the fund would support Nigeria’s electricity-access ambitions while contributing to Mission 300.

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“The commercial launch of the Nigeria Distributed Renewable Energy Fund is a significant step towards delivering Nigeria’s electricity access ambitions and advancing the objectives of Mission 300,” Ogunbiyi said.

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“By creating a dedicated financing mechanism to scale distributed renewable energy, Nigeria is demonstrating how country-led action can translate Mission 300’s ambition into concrete investment and connections.”

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The Director General of the International Solar Alliance, Ashish Khanna, said the Nigerian initiative was the first country-level demonstration linked to a wider continental financing platform under Mission 300.

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According to him, the financing structure could help mobilise capital more efficiently, develop domestic renewable-energy markets and provide a template for other African countries.

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“The Nigeria DRE Fund represents an important milestone in the Mission 300 platform for Africa energy access by building an ecosystem of investment platforms for private sector-led distributed renewable energy across Africa,” Khanna said.

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He added that the model and associated knowledge transfer between Africa and India could be replicated elsewhere on the continent to unlock investment at scale.

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The partners said the fund was structured to use public and development financing to attract additional private-sector investment rather than rely solely on government resources.

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This is expected to address one of the major constraints facing renewable-energy developers, particularly the difficulty of securing sufficient long-term financing for projects serving communities and businesses outside conventional electricity infrastructure.

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The statement said the commercial launch provided “an important foundation for scaling distributed renewable energy solutions across the country” as Nigeria pursued its energy transition and universal electricity-access targets.

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It added that the investment vehicle was designed to grow beyond its initial deployment and provide a financing model that could be replicated in other African markets.

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NSIA, established under the Nigeria Sovereign Investment Authority Act of 2011, manages Nigeria’s sovereign wealth investments through the Stabilisation Fund, Future Generations Fund and Nigeria Infrastructure Fund.

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Africa50 is an infrastructure investment platform backed by African governments and institutions, while SEforALL works with governments and other stakeholders to expand sustainable energy access.

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