Investors now in Nigeria’s off grid power market, they no longer ‘sip tea, go on Safaris’ – Boer

Chief executive officer of All On – an impact investment firm in Nigeria’s off grid electricity market, Dr. Wiebe Boer, has said that developments and potentials in Nigeria’s off grid electricity market have forced international investors to get serious about it.

Boer, said at the recent 2019 edition of the Nigerian Energy Forum (NEF) that before now, the country’s off grid power market couldn’t command such attention because its potentials were not clearly defined and investor had no interest in it.

However, he explained, “the government has done their part – putting in place the right regulations, securing significant capital from the World Bank, the African Development Bank and others, and supporting private sector actors in important ways.

“Every major development partner in Nigeria is contributing as well in an increasingly coordinated and collaborative manner.”

“International players who 2-3 years ago were sipping tea and going on Safaris in East Africa with no plans for Nigeria are rushing in,” he added.

Boer, explained that a good number of Nigerian entrepreneurs were steadily rising to the challenge of leveraging the off grid power revolution to provide electricity for millions of people without any in the country through innovative and adaptive technologies and business models borrowed from elsewhere but making to work in Nigeria.

According to him, there is also, “capital ready to be deployed to finance the takeoff of the sector.” He hinted that three off grid energy companies in Nigeria recently raised around $10 million each, a development he said could have been impossible two years ago.

“There is over $200 million in grant capital coming through the REA’s Nigeria Electrification Program. There is another $80 million in debt capital coming through the EU/AFD’s SUNREF program through Access and UBA,” he added, while pointing out other remarkable developments in the sector.

Cautious optimism

But in spite of the business optimism in the sector, Boer, warned there were still challenges in the sector.

He said: “I also fully realize how hard the Nigerian power sector still is to operate in and how difficult it is for any business in Nigeria to succeed. The regulations are not yet fully tested in the courts, Customs is still not being consistent with other arms of the federal government in support for off grid energy, the typical Nigerian consumer still prefers a generator, mobile money is still limited, there are serious human capacity limitations.”

According to him, the number of new off grid connections in the country may not have gone past 250,000 in spite of the optimism.

“But let’s not dwell on these issues. 250,000 is still a good number considering how new the sector is. And that already means improved livelihoods for over a million Nigerians. Let’s dwell on how good we have it and take advantage of the current goodwill we have from government, investors, donors, and the Nigerian public,” he stated.

But to change the narrative, he explained the industry would need coordination and collaboration between donors, investors, government, and entrepreneurs.

“Within the confines of the law, we need to coordinate within our groups, and across groups. We need to listen to what the entrepreneurs need – and not set up programs based on what we think is best for them,” he explained.

He also stated that the industry need to hold together the on grid and off grid sectors such that, “the two sub-sectors of the power sector do not drift apart so wide that they cannot seek common ground.”

“The power gap is too massive for either one to solve, and we are better off through collaboration,” Boer noted.

He equally talked about ruthless commitment to execution as another necessity in the industry.

According to him: “With all the commercial and impact capital coming in to the market, entrepreneurs now need to focus on execution and scaling. No more excuses about waiting for government or waiting for capital.

“We have done our part, now you do yours. Your success will breed more success. But, if even only 2-3 of the current market leaders fail, the entire industry might fail and the hope of closing Nigeria’s energy gap fails with it.”

“Go to bed every night worried about the millions of our fellow Nigerians who went to bed without light, the children who could not study at night, the clinics that could not operate, the businesses that had to close early, the factories that had to permanently shut down.

“Make it your personal, daily problem to solve, and celebrate every household, every SME, every community, every factory that gets reliable, affordable power – whether from the grid or off the grid,” he further stated.