The Rural Electrification Agency (REA) and the First City Monument Bank (FCMB) have, at the weekend, at the bank’s head-quarters in Marina, Lagos, entered into a strategic collaboration to provide a N100 billion loan facility targeted at accelerating private sector-led deployment of renewable energy solutions across the country.
The agreement supports the implementation of the Distributed Access through Renewable Energy Scale-Up (DARES) initiative as it will enable the deployment of decentralised renewable energy projects aimed at delivering reliable power to approximately 2 million households in unserved and underserved areas across the country.
The signing of these agreements between REA and FCMB signifies the commencement of private sector investment in the Rural Electrification Agency’s renewable energy space, which was catalysed by the $750 million DARES World Bank funding.
The approval of DARES funding by President Bola Ahmed Tinubu, its commencement, and the guidance of the federal ministry of Power will undoubtedly lead to increased private sector funding, accelerating the intended impact of supplying electricity to 17.5 million Nigerians in unserved and underserved communities.
Under this partnership, FCMB will provide a revolving loan facility of N1 billion per eligible mini-grid developer for a period of two years, with potential for scale-up. The facility will serve as a critical financial instrument for developers engaged under REA’s DARES programme, which is an initiative designed to expand inclusive energy access and stimulate economic growth through the deployment of interconnected and isolated mini-grids, as well as productive-use applications.
Speaking at the event, the managing director and CEO of REA, Abba Abubakar Aliyu, emphasised the strategic importance of the collaboration. He stated that, “this partnership signifies a significant milestone in addressing one of the biggest challenges in decentralised renewable energy deployment—access to finance.
Through this facility, developers will have better access to funding that will enable them to scale and meet electrification targets, thus improving the quality of life in rural and peri-urban communities.”
On her part, the managing director and CEO of FCMB, Yemisi Edun stated that, ”our partnership with the Rural Electrification Agency represents a pivotal step in our commitment to powering inclusive growth and economic resilience across Nigeria. Access to reliable energy is a catalyst for enterprise, education, and improved livelihoods, making it a critical development goal.
“Through this collaboration, we are combining financial innovation with infrastructure delivery to ensure underserved communities are not left behind. Together, we are building pathways for people to thrive by unlocking the power of energy to transform homes, businesses, and entire communities.”
A key highlight of the launch was the introduction of a ‘Deal Room.’ This is a dedicated platform for project developers to engage with REA and FCMB on project financing, structure, and disbursement processes. This will enable developers to better understand the eligibility criteria and project evaluation mechanisms.
The partnership structure provides that FCMB will finance up to 70 per cent of approved project costs, while REA will domicile performance-based grant payments into a reserve account within FCMB to further de-risk the transactions.
Through this collaborative approach, REA and FCMB reaffirm their commitment to bridging Nigeria’s energy access gap, promoting private sector participation, and unlocking investment opportunities within the renewable energy sector.
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