SUNREF provides a $70m fund for Nigerian manufacturers
The Sustainable Use of Natural Resources and Energy Finance (SUNREF), a green financing line for businesses developed by the French Development Agency (AFD) and the Manufacturing Association of Nigeria (MAN), has created a $70 million low-cost debt financing funding facility for manufacturers in the country.
This was disclosed during the Renewable Energy and Energy Efficiency investors’ virtual conference recently in partnership with the Nigerian Energy Support Programme (NESP) implemented by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) and off-grid renewable energy investor All-On.
The conference brought together investors, SUNREF Nigeria partner banks, technical assistance providers, renewable energy and energy efficiency project developers, government agencies and other stakeholders.
According to the President of the Manufacturers Association of Nigeria (MAN) Engr. Mansur Ahmed, the SUNREF facility is coming at the right time when manufacturers need more power to drive their operations while urging manufacturers to take advantage of the SUNREF funding facility which is composed of a €60 million ($70 million) low-cost debt financing, a €9.5 million ($11 million) grant facility and technical assistance provided to partner banks and project developers.
“We are excited about it as potential beneficiaries and we hope that both our members and non-members will take full advantage of this opportunity,” he said.
“Clearly, this is the time for every effort to shore up the manufacturing sector. Therefore, I am delighted that this green energy project is focusing on renewable energy in improving energy efficiency.
“We hope that members will take full advantage of this facility and be able to diversify their energy sources, improve energy consumption and be able to expand their productive capacity, `which is indeed very important in the current state of our economy. I, therefore, urge our members to take full advantage of this,” he said.
In his remarks, the Chief Executive Officer of All-On, Dr Wiebe Boer highlighted the huge market potentials in the renewable energy and energy sectors in Nigeria.
“The size of the energy gap in Nigeria is between 30GW and 175GW and would cost between $40 billion to $200 billion to address. Nigerians spend $15 to $20 billion annually on power, which is ten times the grid.
Dr Boer further explained that “this is also a market opportunity for providers of constant, reliable electricity, such as mini-grids which are a potentially $10 billion markets.”
According to Javier Betancourt, Team Lead, SUNREF Nigeria said the facility was aimed at attracting investment into Nigeria’s renewable energy and energy efficiency sector.
He said that the 70 million dollars credit facility was funded by the Agence Française de Développement (AFD) and the European Union Infrastructure Trust Fund (EU-ITF) was launched in July 2020 for the development of green projects in Nigeria.
Betancourt said SUNREF would also provide grants for 10 per cent of the loan amount and technical assistance to support renewable energy and energy projects.
“The SUNREF Nigeria programme seeks to improve access to energy through improved access to affordable finance for renewable energy technologies and energy efficiency initiatives that will improve lives, increase economic opportunities and support various sectors such as industry and agriculture.“The SUNREF initiative has been deployed in over 30 countries and successfully supported over 42 projects in partnership with about 70 banks to the tune of about 2.5 billion euros from AFD, of which 1.2 billion euros has been paid,” he said.
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