A US$10 million syndicated loan facility has been set up by the Renewable Energy Performance Platform (REPP) to scale up efforts to bring electricity to some of Nigeria’s most isolated communities.
UK-based project developer PAS Solar Limited has installed more than 3,500 solar home systems (SHS) for households and micro enterprises with early stage funding assistance from REPP.
This has provided first-time access to clean electricity to an estimated 17,500 people in five of the country’s northern regions.
Now the company is looking to increase the number of installations to at least 35,000 over the next five years, bringing the total number of people getting first-time clean energy access to over 150,000. The loan syndication is a $10m senior debt facility with a five-year tenor that will enable PAS Solar’s expansion plans by crowding-in additional senior lenders.
The facility which was designed by REPP and implemented through the programme’s manager, Camco Clean Energy, as arranger represents an innovative funding solution for the SHS sector.
With sole funding from the UK’s International Climate Finance, REPP has so far committed $2.2m to the syndication, which includes the early stage funding assistance. A further $3m has been committed by the EC-sponsored Electrification Financing Initiative (ElectriFI) facility, managed by EDFI Management Company. The remaining $4.8m of the syndication is available to lenders as an accordion facility.
Geoff Sinclair, REPP Investment Manager and Managing Director at Camco Clean Energy, said: PAS Solar has proven its potential and this syndicated facility lays the groundwork for the developer to access a range of funders as it grows.
We are confident that the mechanism will quickly attract more lenders and PAS can continue its remarkable work bringing clean and affordable electricity to some of Nigeria’s most underserved communities.
Kristoffer Laurson, Chief Financial Officer at PAS Solar, commented: This new syndicated loan program will enable a rapid scaling of the venture during 2019, reaching customers in the current five states and expanding to new regions.
PAS Solar has a strong customer uptake, which proves vast market opportunity in the region and that SHS deployment is commercially viable with a focus on true off-grid communities to replace disposable dry cells and polluting combustible fuels.
Dominiek Deconinck, ElectriFI Fund Manager, said: We are delighted to partner with PAS and REPP to reach out to remote rural communities in Nigeria and bring access to electricity, which is a key driver to economic development.
This investment responds very well to the impact ambitions of the ElectriFI facility, and will help improve the lives of around 150,000 people, replacing harmful kerosene with clean and sustainable solar solutions.