Following the signing of first power purchase agreements for solar power projects, EPC contracts are being sealed for their final implementation in Nigeria.
India-based Sterling & Wilson will set up 250 MW solar power capacity in the west Africa country of Nigeria. The projects are part of the 975 MW capacity whose power purchase agreements (PPAs) were signed by various project developers recently.
The government-owned Nigeria Bulk Electricity Trading (NBET) signed 12 PPAs with cumulative capacity of 975 MW. The developers shall sell power from these projects at US¢11.5/kWh for a period of 20 years.
Sterling & Wilson has managed to grab significant share in EPC contracts in some of the emerging solar power market in Africa. Last year, it landed contract to develop 300 MW solar power projects in Egypt. Additionally, it is also developing projects in Morocco (175 MW), South Africa (87 MW) and Niger (7 MW).
Over the last few months Nigeria has seen increased interest from foreign project developers. One of the reason for this is the regulatory support for the development of renewable energy projects.
Late last year, the Nigerian Electricity Regulatory Commission approved feed-in tariff regulations for renewable energy sourced electricity. As per the provisions of the regulations, electricity distribution companies will be required to source at least 50% of their total procurement from renewable energy sources. The Commission also mandated that the balance 50% electricity would have to be sourced from NBET.