by Faridat Salifu
The Renewable Energy Association of Nigeria (REAN) has released a policy brief outlining strategies to scale renewable energy financing through naira-based concessional loans.
The brief was launched at the renewable energy conference themed “Stronger Together: Advancing Energy Access through Policy, Finance and Inclusion” held on Tuesday at Exclusive Serene Hotel Abuja.
Motunrayo, acting CEO of REAN, said affordable local-currency finance is critical for expanding renewable energy adoption, supporting SMEs, and increasing women-led enterprise participation.
The policy framework proposes hybrid financing models, including single-digit naira loans for renewable energy SMEs and PAYGO companies, portfolio guarantees, refinancing windows extending tenors to 10–15 years, and market-linked instruments such as green bonds and receivables securitisation.
Development finance institutions, including DBN and BoI, are expected to anchor blended facilities combining donor-backed first-loss capital with their balance sheets.
BoI’s Solar Fund, currently at ₦6 billion, is recommended to scale tenfold with longer tenors beyond five years.
Institutional investors such as pension funds and insurance companies are targeted through credit-enhanced instruments, following the model of the ₦5 billion United Capital–Husk revolving facility for community solar mini-grids.
The brief also emphasizes consumer and community access, including enforcement of the Secured Transactions in Movable Assets Act (2017), concessional credit lines for PAYGO vendors, and cooperative finance mechanisms for rural electrification.
Upstream renewable energy manufacturing is included, with concessional naira credit aimed at reducing forex exposure and supporting local solar component production in line with Nigeria’s Industrial Policy and Energy Transition Plan.
A phased roadmap recommends short-term expansion of single-digit loans and pilot refinancing windows, medium-term scaling of blended DBN and BoI facilities, and long-term establishment of a specialized Renewable Energy Finance Facility modeled on Uganda’s UECCC or India’s IREDA.
Motunrayo concluded that coordinated action by regulators, DFIs, commercial banks, investors, developers, and civil society, combined with transparency and governance measures, can unlock affordable local-currency capital, driving energy access, economic inclusion, and climate resilience.
