Bank of Industry targets 25 communities with N1bn solar energy fund

Following the successful completion of pilot scheme in six communities across the country, the Bank of Industry (BoI) has targeted 25 communities with the launching of N1billion Solar Energy Fund for Micro, Small and Medium Enterprises (MSMEs) as an intervention fund aimed at providing alternative and renewable energy for small businesses in the targeted communities.

Renewable Energy provide healthy and sustainable alternative to the continuous use of fossil fuels, with long term cost saving advantages, especially in the absence of reliable power supply which is an essential ingredient for growth.

As a result of this, the Acting Managing Director, BoI, Mr Rasheed Olagunju, argued that the cost of electricity accounts for about 40 per cent of operational expenses for most MSMEs, resulting in reduced profit margins, uncompetitive and generally unsustainable ventures.

According to him, “many Nigerians and Nigerian businesses that can afford other alternative energy sources have resorted to the use of electric generators at exorbitant costs. It was estimated that in 2015, manufacturers spent as much as N3.5 trillion to generate alternative power due to the challenges in the supply of public electricity.

“MSMEs play a major role as the engine through which most countries in the world thrive. Their growth and development are crucial to the level of industrialisation, modernisation, income per capita, equitable distribution of income, welfare and quality of life enjoyed by the citizenry.

“Consequently, the performance of the MSME sub-sector is closely associated with the development of a nation. In Nigeria, the growth of this sector has been hampered over the years by a combination of factors, one of which is access to reliable electricity.

“For Nigeria to therefore achieve sustainable and inclusive development there is an urgent need to substantially increase the supply of modern and affordable energy services from sources that are affordable, accessible and environmentally friendly.”

He said renewable energy provides healthy and sustainable alternative to the continuous use of fossil fuels, with long term cost saving advantages, especially in the absence of reliable power supply which is an essential ingredient for growth.

“It is therefore important to support the provision of sustainable and reliable energy for MSMEs, which is why the Bank of Industry has decided to provide the Solar Energy Fund to MSMEs.

“The Bank is already playing an active role in Lighting up and powering Nigeria through the provision of solar energy solutions for rural communities, having successfully deployed solar solutions worth N240million to six off-grid communities, one each in Niger, Osun, Gombe, Anambra, Edo and Kaduna States, under its pilot scheme.

“These communities with an average of 200 homes each previously had no access to electricity, but since the provision of clean, reliable and sustainable solar electricity, the lives of the indigenes of these communities have changed significantly.

“The provision of solar electricity has reduced energy costs, created more micro businesses, improved health-care and quality of education, and generally provided a new lease of life for indigenes of these otherwise unserved communities.

“This initiative is being replicated in other rural communities in collaboration with our development partners, UNDP and relevant State Governments, and it is now being scaled up to provide energy for MSMEs across the country, commencing with the N1.0 billion Solar Energy Fund that we are here to launch,” he said.

He also emphasized that this initiative is in line with the following Sustainable Development Goals (SDGs) of the United Nations which have been adopted by most countries in the world, including Nigeria.

The SDGs include: Ensuring access to affordable, reliable, sustainable and modern energy for all; taking urgent action to combat climate change and its impact; promoting inclusive and sustainable economic growth; full and productive employment and decent work for all; building resilient infrastructure; promoting inclusive and sustainable industrialisation; and fostering innovation.

“To achieve the above Sustainable Development Goals, it is imperative that Nigeria begins to take proactive steps towards incorporating alternative energy solutions into its energy mix to drive vibrant businesses. This would also contribute towards achieving our intended nationally determined contributions as pledged at the 2015 Paris Agreement to join the rest of the world in combating the menace of climate change,” he said.