Frequently Asked Questions on Performance Based Grant Programme View in PDF format
Yes, a firm can submit an application for the Minimum Subsidy Tender and also submit another for the Performance Based Grant since these are different programs with different eligibility, qualification and technical capability requirements under the NEP.
Yes, a firm can qualify for the Performance Based Grant program through multiple applications, on its own, as part of a consortium and as a subcontractor
Yes, an unincorporated single entity is not eligible to submit an application to the Performance Based Grant program because it lacks corporate status to transact business.
The documentation proving eligibility is not required in order to submit the registration form on the REA webpage to access the Odyssey platform. However, the documentation is required for the Applicant to submit the application through Odyssey for qualification into the Performance Based Grant program.
Definition of incorporation is for the Proposer to register with the Corporate Affairs Commission and obtain the certificate of incorporation in Nigeria. In addition, the Proposer shall also register with the appropriate tax office (i.e Federal Inland Revenue Service) and obtain a Tax Identification Number (TIN) through which deductibles taxes shall be remitted to the Federal Government of Nigeria. A tax clearance certificate is, however, not required at this stage.
The language on the REA registration website has been amended to “Is: a) a single legal entity, duly registered as a legal entity in Nigeria; b) a consortium that is incorporated as a legal entity in Nigeria whose members are jointly and severally liable; or c) an unincorporated consortium.”
The joint and several liabilities is a confirmation that each and all the members of the consortium shall be responsible for the execution of the grant agreement, if awarded. This implies that if anything goes wrong with the contract implementation, every and all the members shall be held liable.
An unincorporated consortium should be supported by a letter of intent to form a consortium. Each member of the consortium does not necessarily have to be incorporated in Nigeria. However, the consortium must be incorporated in Nigeria before signing a grant agreement with the REA.
Applications for the Performance Based Grant program are accepted on a rolling basis until funds are exhausted.
Each Applicant need only qualify once regardless of the number of site-specific technical applications it will submit.
There is no requirement of continuous operations of the mini grid in the past 5 years. The Applicant may have operated the mini grid during any period between January 2014 and the submission of the Application.
There is no restriction as to the commissioning date of the mini grids operated by the Applicant.
There will be no guarantees provided to developers under this program.
The Applicant may use equity to meet the requirements 2.2 (experience in raising equity) and 2.3 (experience in raising debt).
The Applicant should thus demonstrate experience of having secured financing of at least US$100,000 or its Nigerian Naira equivalent in equity, debt, or a combination of both, for at least one (1) project in infrastructure since 2014. The qualification instructions have been revised accordingly.
The lines of credit are acceptable if opened after January 2014.
Debt raised before January 2014 will not be accepted to meet the criterion of having secured US$100,000 in financing.
At a later stage, underserved communities may be considered in the performance-based grant programme. However, for now the performance-based grant programme will be focused on off grid
The Applicant need not be registered in Nigeria at the time that it submits an Application. However, such an Applicant will be required to register the company in Nigeria prior to signing the Grant Agreement with REA.
communities.
Yes, it is possible for the Nigerian subsidiary to be the “Applicant” while using the USA parent entity to meet the eligibility criteria. In such circumstance, the REA may reserve the right to ask for CVs of the management team of the Applicant.
For a joint venture association, members shall be jointly and severally liable for the execution of the assignment. This implies that each and every member shall be required to meet every stated criterion. All the parties combined must meet the criteria and each member must also meet individually for the JV to optimize its grading during evaluation.
By “Registration with Relevant Bodies/Authorities” we meant that the firm should demonstrates, with evidence, valid registration with the corporate affairs commission (CAC), Association for Consulting Engineers in Nigeria (ACEN) e.t.c or equivalent bodies/authorities in the firm’s country of registration/operation.
At a later stage, underserved communities may be considered in the performance-based grant programme. However, for now the performance-based grant programme will be focused on off grid communities.
- Only mini grids in unserved areas are considered for now for the performance-based grant programme. In the future, mini grids in underserved areas may be considered for the performance-based grant programme. The tariff will be set by developers according to the NERC regulation for mini grids.
At first, the programme will focus on mini grids in unserved areas, so mini grids will not have direct dealings with Discos and Gencos.
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The amount of subsidy does not depend on the capacity of the mini grid. It is set a $350 for the performance-based grant programme.
For now, the performance-based grant program focuses only on isolated mini grids. Under the mini grid regulations, if a community already served by a Disco wants to get electricity from a mini grid, the community should sign a tripartite agreement with the Disco, and the mini grid developer.
For the PBG site approval, the developer is only required to submits its generation and distribution design. The tariff approval process will be done in parallel.
The approval is done once a month
- If 60% of the potential customers in the community agree to a tariff proposed by the developer, NERC will approve this tariff.
Prior to the deployment of the mini grids, developers are expected to carry out community engagements to communicate the terms of the service. This is the responsibility of the developer and not the REA..
For places with coverage, the connections would be managed through data from smart meters. For places with poor network coverage, the metering data would be uploaded and sent to the REA where network can be found. Independent verification agents will also go to selected sites and physically confirm the data is accurate
