The project is not a contract, but an investment by the company supported by the Ogun State Government, Nigeria Energy Support Programme (NESP), European Union, GIZ, and USAID explains Bolade Soremekun the company’s CEO during the launch on February 9.
“It is a N200 million investment comprising 50% grant from GIZ, 39% loan from Bettervest of Germany, and 11% equity from Rubitec Nigeria Ltd. It is by such investment that mini grid projects can be sustainable. The project must earn profit for its investors, pay back its loans, and justify the grants that come from EU tax payers’ funds,” said Soremekun.
Rubitec emerged successful out of 70 companies that responded to a request for proposal by The Nigerian Energy Support Programme (NESP) funded by the European Union and the German Federal Ministry for Economic Cooperation and Development (BMZ) and is implemented by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH in close collaboration with the Federal Ministry of Power (FMP) and five (5) selected State Governments (Cross River, Niger, Ogun, Plateau and Sokoto). Winrock, the implementing partner of USAID, also supported the project by promoting access to finance workshops and initiatives.
“We were still sceptical, but we went along and began to develop the business plan, and through several workshops over the next two years, we developed the many skills – technical, business development, financial and business modelling to build a mini grid.
“We spent time in several finance workshops supported by our partnering agencies and presented our project to local and international banks and financial institutions. With time we were able to put together a financing package that consisted of our equity, a loan from a Bettervest, a German Crowdfunding organization, and a Grant from GIZ. Winrock/USAID provided the crucial connection with Bettervest. We thank all our partners also for the technical training our staff received both at home and abroad throughout the development phase,” says Soremekun.
The village of Gbamugbamu has a population of 3,500 people. The village is well organized with a Baale, sectioned into zones with a leader for each zone. It is mainly an agrarian village growing and processing economic crops including cocoa, palm oil, plantain, kolanuts, cassava, yam, and maize.
“Our mini grid will serve 487 metered customers, with 462 1phase connections, and 25 3phase customers. The PV system will generate >190,000kWh/year of electricity, transmitted and distributed across 5.2 Km of grid for different categories of consumers – businesses and households. We have installed pre-paid meters. We encourage the people of Gbamugbamu to pay for their electricity as this will make the project sustainable.
“The village has grown rapidly, from the time of our first research up until now. We shall be deploying very soon to connect the new customers and houses being added as we speak. The Baale, Chief Adekunle Fayomi and his team have been very cooperative, and have supported all the work we have done,” says Soremekun.Businessday.