SOLAR HOME SYSTEMS — Rural Electrification Agency

Nigeria Electrification Project (NEP) SHS Component Description
The SHS component aims to help capable solar providers reach more rapidly underserved Nigerian households and micro enterprises (MSMEs) and provide access to better energy services at lower cost than their current service. The target beneficiaries are those that lack connection to energy services and do not expect a connection in a timely manner or suffer from unreliable and expensive power and do not anticipate improvement in service.
The grant support provided through NEP will aim to leverage other sources of finance such as: company’s own equity, equity from investors, and facilitate access to credit by reducing risk to lending entities.
The NEP SHS program consists of two investment instruments:

Output Based Fund (OBF)

Output Based Fund (OBF).

This fund will provide fixed incentive grants in the range of 20% of the retail cost of the system to the grantees, per each eligible system installed and verified. This support will enable the firms to finance the required investment in people, training, advertising, processes, and logistics inclusive of gender workforce integration and disaggregation as informed by the NEP gender program. The grant amount will be fixed for each system size/level of service category and revised periodically aiming to continually reduce it over the life of the program.

An Independent Verification Agency will be engaged by REA-PMU to carry out the verifications of claims submitted by the participating solar companies. The companies can submit claims as frequently as once per month by logging the required information on the online platform (details to be provided to successful applicants). The minimum threshold requirement is sales of at least 150 systems per month.

The online application for OBF will remain open to apply on a rolling basis.

Click this link to register on the REA NEP SHS PROGRAMME

Market Scale-up Challenge Fund (MSCF)

Market Scale-up Challenge Fund (MSCF)

The MSCF offers up-front grants to a small number of strongest and most capable solar providers, paid against robust business plan milestones and co-funding requirements, to accelerate their capacity to reach and serve Nigerian households and small enterprises at scale. The purpose of the grants is to reduce the risk to investors and be used to provide additional direct working capital to enable faster investment in the inventory and expanding distribution. The MSCF is not aimed at supporting small, early growth stage companies that might hold such ambitions but do not yet possess the capacity to achieve it in a comprehensive way. However, it may support companies who are quickly emerging to become established market leaders.

A rigorous evaluation process will emphasize a robust business plan of international standards; a senior management team that is capable across all key disciplines, including consumer marketing, consumer finance, IT, logistics, financial management, business process management; commitment to high sales targets or rapid growth in monthly sales; and a credible pathway to mobilizing the substantial capital required to grow. Only companies that demonstrate this higher level of capacity will be eligible for a full evaluation under the Market Scale-up Challenge Grants. The solar companies that receive grants from the Market Scale-up Challenge Fund remain eligible to claim the Output Based Grants as well.

When applying for the OBF, applicants will need to indicate interest in applying for this opportunity. The decision on whether the applicant will be invited to apply for MSCF will be based on the level of readiness and potential for meeting the above criteria.

Evaluation and Administration

Evaluation and Administration

A competitively selected Grant Administration Firm (GA) will handle the day-to-day communication with the grantees and will report to the NEP Project Management Unit (PMU) at the REA. The GA will be responsible for tracking the grant allocations to the grantees, screening applicants against eligibility criteria at the pre-qualification stage, and tracking progress toward meeting the milestones and results achieved by the grantees.

The Selection Panel (SP) established by REA and consisting of in-depth knowledge of the business of SHS in the private sector covering all business models and all aspects of the business will select the companies to be awarded the MSCF. The panel will be selected in their personal and professional capacity and appointed after approval by the REA and no-objection by the World Bank.

Market Intelligence

MARKET INTELLIGENCE
Market intelligence is the information relevant to a company’s market, gathered and analyzed specifically for the purpose of accurate and confident decision-making in determining strategy in areas such as market opportunity, market penetration strategy and market development. To enable the Nigerian market for SHS, we understand the importance of accurately analyzed data. Therefore, we have pooled various sources of readily available data to support market growth.

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