Foreign investors continue to be attracted by the budding renewable energy market in Nigeria as the government there signed fresh agreements for large-scale solar power development.
According to media reports, two companies signed memoranda of understanding with the government of Nigeria to set up a total of 300 MW solar power capacity. Nigeria-based Nigus Greenergy and South Africa-based Volt Renewables formed a joint venture and signed the project development agreement.
The capacity shall be divided into three projects of 100 MW capacity each located in states of Andamawa, Kano and Kebbi. The power generated from the projects will be sold to Nigeria Bulk Electricity Trading (NBET) through a long-term agreement. The projects are expected to be operational by next year although tariff for the PPAs has not be disclosed yet.
Earlier this month, NBET signed the first power purchase agreements with solar power project developers. The NBET signed 12 PPAs with projects of 975 MW cumulative capacity. The developers shall sell power from these projects at US¢11.5/kWh for a period of 20 years.
The development of solar power projects in Nigeria has full support and regulatory backing of the government. 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 has also mandated that the balance 50% electricity would have to be sourced from Nigerian Bulk Electricity Trading Company.