Nigeria signs first ever solar PPA

Share on facebook
Share on twitter
Share on linkedin
Share on reddit
Share on email
Pan Africa Solar signed the country's first ever 20-year PPA atUS11.5¢/kWh. Source: Flickr/canonim

Federal government-owned public liability, the Nigerian Bulk Electricity Trading (NBET), has signed the country’s first ever solar power purchase agreement (PPA) with more than ten project developers, totalling 975MW of utility-scale solar. As of last week, there were 15 projects with generation licences, so it is possible that there could still be more in the pipeline.

As other countries across the continent make solar waves with successful auctions and feed-in tariff programmes, Nigeria had, until now, stayed relatively quiet in its solar energy ventures.

The first official project to be implemented under the 20-year PPA is a 75MW solar plant in Katsina state, to be developed by European/Nigerian utility-scale investor and developer Pan Africa Solar, in collaboration with JCM Capital, an Ontario-based developer.

According to JCM Capital’s Justin Woodward, the project is worth US$146 million and hopes to hit financial close in Q1 2017. The signing of the PPA with the federal government of Nigeria is a significant breakthrough for the project, which has been under development since 2011. It also features single axis trackers and is being financed by the Netherlands Development Finance Company (FMO) as the leading debt syndicate. Also according to Woodward, the plant will sell power at a fixed rate of US$11.5¢/kWh.

The commissioning of the Katsina project is a giant step forward for Nigeria’s solar progress; constituting the largest plant of its kind in Sub-Saharan Africa, (excluding South Africa, which has seen many successful tenders as of late), and is set to provide enough clean electricity to power 1.1 million Nigerian homes.

Marcus Heal, Pan Africa’s CEO, has told local press in widely reported statements that the company plans to develop 1,000MW of solar projects in Nigeria and has ambitions to bring in more than US$1 billion of investment over the next five years.

Although so far not seen as a particularly hot spot for solar, JCM Capital’s Woodward told PV Tech that Nigeria’s ‘utility-scale solar revolution’, as it has been dubbed, is “long overdue”.

“There is a massive power deficit. Gas is not a solution for the northern part of the country – solar really is the only solution. Additionally, generation in the north will help stabilise the whole grid.”

Read Next

February 22, 2021
COVID-19-induced project delays impacted India’s solar power transition last year, but 2021 is still set to be a “landmark year” for the resource, according to new research.
February 19, 2021
A new energy strategy in Poland that aims to transition the country to a low-carbon economy by 2040 underestimates the growth potential of solar generation, PV trade associations have suggested.
February 17, 2021
Shorter purchasing contracts with private companies could be a "lucrative" short-term source of income for Poland's solar market.
February 5, 2021
We caught up with Luca Pedretti, Pexapark's co-founder and chief operating officer, to discuss how PPAs are changing to accommodate more offtakers from a range of business sectors.
February 5, 2021
Global energy major Total has continued its flurry of utility-scale solar acquisitions, picking up a 2.2GW pipeline of assets in Texas.
February 4, 2021
Shorter power purchase agreements (PPA) could become more commonplace in Europe’s solar sector as developers strive to bring on more offtakers.

Subscribe to Newsletter

Upcoming Events

Solar Media Events, Upcoming Webinars
March 9, 2021
Solar Media Events
March 17, 2021
Solar Media Events
April 13, 2021
Solar Media Events
April 20, 2021