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GREEN INVESTMENTS IN NIGERIA: SUSTAINABLE OPPORTUNITIES FOR INVESTORS

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GREEN INVESTMENTS IN NIGERIA SUSTAINABLE OPPORTUNITIES FOR INVESTORS

GREEN INVESTMENTS IN NIGERIA: SUSTAINABLE OPPORTUNITIES FOR INVESTORS

INTRODUCTION:

The value of sustainable investments has emerged as the globe struggles to address the problems caused by climate change. The largest economy in Africa, Nigeria, offers excellent potential for green investments. This article examines the possibilities for sustainable investment in Nigeria, highlighting the nation’s market for renewable energy, green infrastructure initiatives, and governmental programs that make it a desirable location for investors who care about the environment.

 

RENEWABLE ENERGY MARKET

Nigeria has a huge potential for the development of renewable energy because of its plentiful solar, wind, and biomass resources. To entice investors into the sector, the government has put rules and incentives in place. By 2030, Nigeria’s entire energy mix is to include 30% renewable energy, according to the Renewable Energy Master Plan (REMP). Investment opportunities exist in industries like solar power plants, wind farms, biomass energy, and mini-grids to offer off-grid communities sustainable energy options.

A substantial section of Nigeria’s population doesn’t have access to a steady source of electricity. Off-grid energy solutions can fill this energy shortfall while reducing carbon emissions at the same time. The opportunity for investors to supply clean and affordable energy to marginalized populations through solar household systems, mini-grids, and decentralized renewable energy solutions is enormous. Programs like the Energizing Economies Initiative (EEI) were started by the government’s Rural Electrification Agency (REA) to boost off-grid energy access and open doors for private investors.

GREEN INVESTMENTS IN NIGERIA SUSTAINABLE OPPORTUNITIES FOR INVESTORS

Nigeria’s expanding population and quick urbanization call for the development of sustainable infrastructure. Investors can look at opportunities in waste management, water resource management, energy-efficient transportation systems, and green building development. The dedication of the government to The Lagos Green Building Policy, which strives to encourage environmentally and energy-friendly structures, is an example of sustainable infrastructure. Such initiatives not only lessen their negative effects on the environment, but they also have long-term economic advantages.

The Nigerian government has put in place a number of laws, regulations, and incentives to promote green investments. In particular, renewable energy and environmental sustainability are highlighted in the Economic Recovery and Growth Plan (ERGP) of the Federal Government. Additionally, organizations like the Nigerian Investment Promotion Commission (NIPC) and the Bank of Industry (BOI), which provide funding for sustainable projects, offer tax incentives, exemptions, and grants.

 

INITIATIVES FOR ENVIRONMENTAL SUSTAINABILITY

Nigeria has taken action to safeguard its natural resources because it understands the value of environmental preservation. Initiatives for environmental sustainability include a variety of initiatives to address environmental issues, safeguard natural resources, and minimize ecological footprints. Among the organizations actively promoting these projects are the National Park Service (NPS) and the Nigerian Conservation Foundation (NCF). Some important environmental sustainability efforts are listed below:

  1. Transition to Renewable Energy: Reducing greenhouse gas emissions and addressing climate change depend heavily on the utilization of renewable energy sources, such as solar, wind, and hydropower. Governments, companies, and private citizens are making investments in clean energy infrastructure and encouraging the use of it.
  2. Energy Conservation and Efficiency: Improving energy efficiency is a crucial step in lowering energy use and waste. This entails putting in place energy-saving technologies, encouraging energy-saving habits, and implementing energy management systems. it aids reduce carbon emissions and resource consumption.
  3. Environmental Sustainability: Reducing emissions from the transportation industry is an important step toward environmental sustainability. Developing facilities for cycling and walking as well as promoting public transportation and electric automobiles are all part of this. It seeks to lessen reliance on fossil fuels, traffic congestion, and air pollution.
  4. Waste Management and Recycling: To conserve resources and cut down on the amount of waste transported to landfills, effective waste management and recycling programs are crucial. This entails putting recycling programs into place, supporting composting, minimizing single-use plastics, and promoting eco-friendly packaging techniques.
  5. Conservation of Natural Resources: Protecting and conserving natural resources, such as forests, water bodies, and biodiversity, is vital for maintaining ecological balance. Initiatives include establishing protected areas, promoting sustainable forestry practices, restoring degraded lands, and implementing water conservation measures.
  6. Circular Economy: Changing to a circular economy is a crucial step toward minimizing waste and maximizing resource use. Creating durable products, recycling and reusing resources, and embracing ideas like product sharing and extended producer responsibility are all part of it.
  7. Sustainable Agriculture and Food Systems: Supporting sustainable agricultural methods like organic farming, agroforestry, and precision agriculture reduces the use of chemicals, protects soil quality, and maintains biodiversity. Along with decreasing food waste, initiatives support fair trade principles and local, seasonal food production.
  8. Conservation and Restoration of Ecosystems: Preserving and restoring ecosystems, such as forests, wetlands, and coral reefs, is crucial for biodiversity conservation and climate change mitigation. Initiatives include reforestation projects, wetland restoration, marine conservation efforts, and sustainable land management practices.
  9. Education and Awareness: Promoting environmental education and raising awareness about sustainability issues is a fundamental initiative. This includes integrating sustainability into educational curricula, organizing campaigns and workshops, and fostering sustainable behavior change among individuals and communities.
  10. Collaboration and Partnerships: For effective sustainability efforts to be driven, partnerships and collaborations between governments, organizations, and communities are crucial. Large-scale sustainability projects can be implemented more easily because to multi-stakeholder efforts, public-private partnerships, and international cooperation.

These programs are essential for combating environmental problems, fostering a more sustainable future, and preserving the welfare of current and future generations. Among the groups actively involved are the National Park Service (NPS) and the Nigerian Conservation Foundation (NCF). in supporting these programs.

 

CHALLENGES AND FUTURE OUTLOOK

While the potential for green investments in nigeria is significant, there are difficulties to be survived. Investors may encounter difficulties due to problems like inadequate financial access, unclear regulations, and the requirement for effective sustainability reporting mechanisms. However, the Nigerian government’s dedication to sustainable growth and increased knowledge about environmental issues provide a good investment climate

Challenges:

  1. Limited Knowledge And Instruction: The lack of knowledge and comprehension of green technology and their potential advantages is one of Nigeria’s biggest obstacles to green investment. The prospects and benefits of investing in renewable energy, energy efficiency, and other green sectors may not be well known to many investors and enterprises.
  2. The Absence Of A Policy And Regulatory Framework: It is extremely difficult to create a complete policy and regulatory framework for green investment. Investors require a stable and benevolent political setting that offers incentives, rules, and regulations to support green investments.
  3. Access to Finance: In many nations, including Nigeria, obtaining financing is a problem for green investment. Investments in renewable energy projects and other green initiatives must be enticed by adequate financing methods, such as green bonds, venture capital funds, and public-private partnerships.
  4. Infrastructure And Technical Skills: Nigerian green investment faces difficulties due to inadequate infrastructure and low technical skills. Potential investors in renewable energy projects may be put off by, for instance, the absence of dependable energy grids. Similarly, a lack of knowledgeable workers with experience in green technologies could be detrimental. the execution and upkeep of environmental programs.
  5. Political Instability and Corruption: These two factors may discourage green investors. For green sectors to attract long-term investments, a stable political climate and open government are essential.

 

Future Outlook:

  1. Growing Advocacy and Awareness: As people become more aware of environmental problems and the advantages of green investment, there is a growing movement in Nigeria toward sustainable and green development. Campaigns for education and advocacy can be quite effective in raising awareness of the value of green investment.
  2. Policy And Regulation Changes: To encourage green investment, the Nigerian government has begun enacting changes. For instance, the Nigerian Green Bond Programme was introduced in 2017 to raise money for green projects. Reforms to policies and laws should continue. to foster an environment that will attract investment in green projects.
  3. Investment and Financing Opportunities: With the expansion of renewable energy projects, energy-efficient infrastructure, waste management systems, and sustainable agricultural methods, Nigeria is likely to see an increase in green investment opportunities. The government is also looking into ways to entice private sector involvement and foreign direct investment into the green sector.
  4. Technology Transfer and Capacity Building: International partnerships and technology transfers can assist Nigeria develop its technical expertise in green industries. Technical training initiatives and collaborations can improve local professionals’ competencies, fostering the effective implementation and upkeep of green project initiatives.
  5. International Support: Through financial support, technical help, and information sharing, international organizations and development partners can support the expansion of green investment in Nigeria. Working together can assist solve problems and promote the nation’s sustainable development.

Despite these obstacles, Nigeria’s prospects for green investment are positive due to increased government backing, rising awareness, and prospective investment opportunities in a range of green sectors.

 

CONCLUSION:

For investors looking to match their portfolios with sustainability goals, green investments in Nigeria provide attractive options. For environmentally minded investors, the market for renewable energy, green infrastructure projects, government assistance, and environmental activities offer an alluring panorama. Aside from offering excellent profits, investing in Nigeria’s green sector will help combat climate change and advance a more sustainable future as the nation continues to place a high priority on sustainable development.

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Tanzania and the East African Community (EAC) at the centre of regional transmission expansion: Tanzania Energy Cooperation Summit 2024

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Tanzania and the East African Community (EAC) at the centre of regional transmission expansion

Tanzania and the East African Community (EAC) at the centre of regional transmission expansion: Tanzania Energy Cooperation Summit 2024

Confirmed as one of the most stable and important investment destinations on the continent, Tanzania prepares to host the fifth annual Tanzania Energy Cooperation Summit (TECS) from 31 January to 1 February 2024 in Arusha, home of the East African Community (EAC).

Investors from across industry, finance and government are convening to showcase Tanzania’s potential. Potential that is epitomised by a country now ranked third in sub-Saharan Africa for future investment, that is expected to see 6% GDP growth by 2025, and that has seen hundreds of millions, if not billions, of dollars of investment, targeted towards infrastructure, hydropower, LNG and solar projects in recent years.

Tanzania and the East African Community (EAC) at the centre of regional transmission expansion

Ranked by KPMG behind only South Africa and Nigeria, Tanzania has confirmed its status when it comes to trade and investment.

The nation was cited for its strategic location to the east of the continent, its abundance of natural resources, and its recent investment spike, especially in the power sector. A first on-grid 50MW solar power plant, a $300 million investment into hydropower, a $42 billion LNG project formed by Shell, Equinor and Exxon Mobil, and almost $7 billion injected into infrastructure, confirms its attractiveness both in Africa, and globally.

Organised by EnergyNet, TECS24 will not only highlight these success stories but look at future trade and generation projects poised to transform the country and region further. Challenges around financing and guarantees will also be brought to the fore, to ensure that momentum isn’t lost and that the country’s power sector continues to go from strength to strength.

Alongside major investors, stakeholders attending include national ministers from Tanzania, Malawi and Ethiopia, as well as heads of national utilities, including Tanzania’s Managing Director of TANESCO, Gissima Nyamo-Hanga. Speakers from Electricidade de Moçambique (EDM) and Zambia’s ZESCO will also be present. They, alongside representatives from the public and private sectors, DFIs – including AfDB, BII, World Bank Group and ATIDI – and multilaterals, will descend on Arusha for an intimate, high-level business retreat like no other.

With an emphasis on Tanzania’s’ position as a regional energy enabler, topics being brought to the table include Tanzania’s economic outlook and energy development potential, as well as plotting the best way to build a regional power market. Public-private partnerships in transmission projects will also be on the agenda, in addition to DFIs, governance and regulations, and the vital role of renewables. Attendees will be invited to offer ideas around building better regional interconnection, more robust frameworks for trade and investment, and ultimately to form a roadmap for regional energy access moving forward.

“Tanzania’s positioning on the continent has made it pivotal to trade. With connections between south and east and also to the rest of the world, the country has always had the potential to be a trailblazer for industrial growth – and now we’re seeing how this potential will be realised. It’s therefore hugely exciting to showcase Tanzania’s growth and to make sure the opportunity and momentum continues.” said Simon Gosling, Managing Director, EnergyNet.

He continued, “We’re also delighted to be hosting the summit in Arusha, giving everyone the time and space to deep-dive into the sector’s most pressing topics.”

“With Tanzania being one of our founding member countries, we are keen to do more in support of the country’s energy sector goals. Building on the progress made at last year’s event in Dar es Salaam, we hope that TECS24 will provide greater clarity on the proposed role of the private sector in the energy sector and how DFIs – particularly multilateral insurers and guarantors like ATIDI – can be supportive of such efforts and the wider energy transition,” commented Obbie Banda, Underwriter & Acting RLSF Coordinator at the African Trade & Investment Development Insurance (ATIDI).

Aleem Tharani, Co-Head for Infrastructure Sector Group (Africa), Bowmans and Head of Projects, Energy & Infrastructure (Africa), concluded: “The 5th Tanzania Energy Cooperation Summit marks a pivotal moment for Africa’s energy sector. By uniting investors, government entities and industry specialists, we’re fostering dialogues crucial for advancing Tanzania’s energy roadmap, prioritising gas and renewables, and enhancing regional transmission. Bowmans is proud to sponsor this summit, recognising its significance in shaping Africa’s energy future and strengthening public-private partnerships.”

 

FACILITATING ENERGY INVESTMENT IN FAST-GROWING ECONOMIES – EnergyNet has produced investment forums and executive dialogues for Africa and Latin America’s power sectors for the last 25 years – in Europe, the USA, Asia and across Africa and Latin America.

We work with governments and national utilities to facilitate investment summits where credible international investors can build relationships with public sector stakeholders to advance access to power.

Best known for the Africa Energy Forum, the longest-serving business development meeting place for senior-level decision makers in Africa’s power sector, other leading investment summits we provide strategic perspectives on the investment landscape and project preparation include the Tanzania Energy Cooperation Summit, H2 Africa, Offshore Technology Africa, Powering Africa Summit, Latin American Energy Forum and Latin American & Caribbean Gas Conference and Exhibition. YES! Youth Energy Summit and YES! Youth Energy Day are part of the portfolio, with a focus on creating a platform and network to boost the skills, connections and business readiness of a new generation of African energy leaders

Having this focus on public and private sector partnerships provides us with a valuable lens through which we can offer independent perspectives and support the business development activities of companies from around the world operating in these fast-growing markets. Our team talks daily with stakeholders across Africa, Latin America and the Caribbean to support these insights, so relationships and investor insights are our business and our passion.

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MSGBC Conference to Feature Roadshow on Mauritanian Exploration Opportunities

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MSGBC Conference to Feature Roadshow on Mauritanian Exploration Opportunities

MSGBC Conference to Feature Roadshow on Mauritanian Exploration Opportunities.

A special session on Mauritania’s exploration prospects during the MSGBC Oil, Gas & Power 2023 conference will delve into a range of topics, from geology to investment incentives and ongoing developments.

Mauritania is making great strides to attract foreign investment across its untapped upstream market, introducing a 15-block offshore licensing round; strengthening geological surveying and data acquisition; while promoting collaboration between Mauritanian and global partners. The country’s upstream prospects will be further explored during the MSGBC Oil, Gas & Power 2023 conference and exhibition (https://apo-opa.info/479O0lz), scheduled for November 21-22 this year.

MSGBC Conference to Feature Roadshow on Mauritanian Exploration Opportunities

In an exclusive panel session titled, ‘Focus on Mauritania: Road Show on Exploration & Opportunities’, a suite of Mauritanian policymakers, global E&P investors and regional stakeholders will engage in pivotal discussions and strategic planning on Mauritania’s upstream sector. For potential players looking at tapping into one of the world’s final frontiers for offshore exploration, the Mauritanian exploration roadshow is a not-to-be-missed event.

The Mauritanian Coastal Basin, an area with an extensive 2D and 3D seismic data coverage – covering more than 100,000 km, respectively – has become a focal point for exploration in recent years. The discovery of the Chinguetti oilfield in 2001 marked the opening of the tertiary petroleum system in the basin, while the 2015 GTA gas discovery in Block C8 unveiled deeper Cretaceous petroleum systems. These breakthroughs, coupled with growing global demand for oil and gas, emphasize the country’s evolving energy potential and growing prominence, and the Mauritanian roadshow will provide insight into the country’s unique offshore geological features.

The exploration session will serve as a bridge connecting government decision-makers, data experts, and industry players, providing a unique platform to exchange insights, share vital information, and outline the future trajectory of energy exploration and development in Mauritania. The panel of experts will delve into a series of essential topics that collectively form a holistic view of Mauritania’s exploration perspectives.

Serving to connect investors with Mauritanian opportunities, the session will provide an overview of Mauritania’s business environment and investor safeguards, showcasing the country’s commitment to creating a secure investment climate. The legal investment framework and the benefits and exemptions in promotional zones will be highlighted, emphasizing how these incentives can foster business growth. Correspondingly, details of the country’s latest bid licensing round, which features 15 offshore blocks, will be provided, connecting new players to the country’s promising yet untapped acreage.

Under efforts to promote exploration and production, the Mauritanian Government revised the legal and regulatory framework, implementing tax rules and exemptions to entice foreign and regional players. Through the Petroleum Code – introduced in 1998 and revised in 2011 – the Government sought to incentivize foreign investment in upstream activities, enhancing transparency, clarity and productivity across the hydrocarbons market. Regulatory revisions continue to be made, and in addition to geological insight, the Mauritanian session this November will provide a comprehensive overview of the country’s investment environment, equipping potential investors with the information they need to make informed decisions.

Efforts to enhance investment attractiveness have already translated into several key milestones, with a number of foreign players exploring the offshore market. International heavyweights to the likes of bp, Kosmos Energy, TotalEnergies, Shell, and many more now operate in this region, signaling the growing significance of Mauritania in the global energy landscape. These and many other players are looking at fostering new partnerships, and the session will offer insights into promising prospects and collaborations, illustrating the exciting potential of Mauritania’s energy sector.

MSGBC Oil, Gas & Power 2023 is a crucial milestone for the energy sector, bringing together key stakeholders, policymakers, and industry experts to discuss the most recent exploration opportunities in the region. The Mauritanian exploration roadshow, for its part, acts as a catalyst for information exchange and partnerships, and will greatly contribute to the MSGBC region’s long-term energy success.

Organized by Energy Capital & Power, the conference takes place under the patronage of the President of the Republic of Mauritania Mohamed Ould Cheikh El Ghazouani and in partnership with Mauritania’s Ministry of Petroleum, Energy and Mines; the Mauritanian Oil and Mining Company; Petrosen; COS-Petrogaz; and the African Energy Chamber. Register now to secure your place!

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CrossBoundary Access open sources project financing tools used to finance over $80m of mini grids in Africa

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CrossBoundary Access open sources project financing tools used to finance over $80m of mini grids in Africa

CrossBoundary Access open sources project financing tools used to finance over $80m of mini grids in Africa

CrossBoundary Access, in partnership with Shell Foundation, the UK-registered charity, is open sourcing the project financing tools they have used to structure and finance over $80m of mini-grid projects.

Mini grids are the least cost method to provide electricity to 260 million people in Africa and have a critical role in achieving universal energy access on the continent; However, mini grids are complex infrastructure assets. It typically takes 12-24 months to structure and finance a mini grid project; CrossBoundary Access (CrossBoundary.com/Access) is open sourcing the project financing tools they have used to finance over $80m of mini-grid projects to accelerate universal energy access in Africa.

CrossBoundary Access open sources project financing tools used to finance over $80m of mini grids in Africa

CrossBoundary Access, in partnership with Shell Foundation, the UK-registered charity, is open sourcing the project financing tools they have used to structure and finance over $80m of mini-grid projects. CrossBoundary Access has shared a project finance model on its website today (https://apo-opa.info/49gLCLC) and will share template project financing term sheets later this year. CrossBoundary Access believes open sourcing financial tools and approaches across the sector will accelerate the flow of capital needed to achieve universal energy access in Africa.

The International Energy Agency (IEA) forecasts that the number of people in Sub-Saharan Africa without power – 600 million – will be largely unchanged by 2030. Mini-grids – self-sufficient electricity grids that can serve households and businesses – have a critical role to play in bridging the gap. They are the least-cost method to bring electricity to over 260 million people.

However, mini grids are complex infrastructure assets that typically take 12-24 months to finance. Mini grids are small (typically less than $500,000 in capex), have unfixed long-term cash flows such as revenue, diesel expenditure, battery replacements, etc., and are typically mixed with other non-infrastructure assets and activities. The process of ring-fencing mini-grid assets into standalone investment vehicles, and fixing and allocating revenues, costs, and risks over a typical 10–20-year infrastructure investment horizon is a highly intensive process. Detailed, interlocking financial models and project contracts are required to create bankable mini-grid projects.

CrossBoundary Access is open sourcing the two interlocking financing tools it has developed over the last 6 years – a financial model and project term sheets – to accelerate the flow of capital into the mini-grid sector. The open-source movement was first pioneered by the software industry in the 1990s. CrossBoundary Access believes the energy access sector should adopt its own open source model to accelerate industry collaboration. Continuous sharing and improvement of the sector’s financing tools is needed to attract and deploy capital into mini grids.

Read more on why CrossBoundary Access and Shell Foundation believe open source can accelerate universal energy access in Africa in this article (https://apo-opa.info/47fIoGf).

Terry Otinga, Senior Investment Associate and Open-Source lead at CrossBoundary Access, says, “We are excited to share these tools and are especially eager to exchange lessons learnt with developers and investors. This will bring us a step closer to closing the energy access gap in Africa. That’s what open source is about.”

Kwaku Owusu-AchawBusiness Development Director at the Shell Foundation, says, “We are thrilled to partner with CrossBoundary Access to share this innovative financing approach. We hope that this is useful for the sector and gives developers the tools to raise capital and improve energy access in Africa.”

Humphrey Wireko, Managing Director at CrossBoundary Access, says, “We appreciate Shell Foundation’s support in this initiative. In order to reach the 300 million people in Africa best served by mini-grids, we need a lot more mini-grids being built and more investors providing capital to this sector. Hopefully this helps make that happen.”

About CrossBoundary Access:
CrossBoundary Access (CrossBoundary.com/Access) is Africa’s first blended finance platform for mini grids. CrossBoundary Access uses an innovative blended finance approach to invest in mini-grids and provide 24/7 grid-quality power to households and businesses in rural Africa. CrossBoundary Access reached first close in June 2022 with $25 million from ARCH Emerging Markets Partners Limited, Bank of America, and Microsoft Climate Innovation Fund. In September 2023, the platform secured an additional $10 million from AfDB’s Sustainable Energy Fund for Africa (SEFA). CrossBoundary Access continues to raise and deploy a total of $150 million of blended project finance over the next three years to bring clean energy to one million people in Africa. CrossBoundary Access is a member of the CrossBoundary Group. https://apo-opa.info/3skZIeb

About Shell Foundation:
Shell Foundation (https://ShellFoundation.org) is an endowed, UK-registered charity that catalyses clean energy innovation and unlocks inclusive investments in Africa and India, empowering millions of underserved customers – of which half are women – to earn a living income. Shell Foundation, with co-funding from the UK government through the FCDO, funded the open source project to encourage more investments in mini-grids, which can power whole communities, helping small business owners, rural agricultural households, and urban transporters, the key focus customer groups for the Foundation.

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