The Rural Electrification Agency (REA) has signed a Memorandum of Understanding (MoU) with Stanbic IBTC Bank Limited for a ₦100 billion project financing facility designed to strengthen access to finance for renewable energy developers and support the expansion of electricity services to unserved and underserved communities across Nigeria.
The agreement, signed Thursday at the REA Corporate Headquarters in Abuja, establishes a framework through which Stanbic IBTC will provide financing to eligible project developers participating in REA-led electrification programmes, including the Distributed Access through Renewable Energy Scale-up (DARES) Project) which is a World Bank-funded scale-up of the Nigeria Electrification Project (NEP).
Under the MoU, Stanbic IBTC will make available a ₦100 billion revolving loan facility for eligible project developers to procure equipment required for renewable energy projects under REA programmes. The facility has a one-year tenor, with the amount accessible to each developer determined on a case-by-case basis, subject to the underlying grant agreement, developer capacity and the Bank’s credit assessment.
Speaking at the signing ceremony, the Managing Director/CEO of the Rural Electrification Agency, Abba Abubakar Aliyu, said the partnership would help strengthen the financing ecosystem required to deliver renewable energy infrastructure at scale.
“One of the lessons from our experience under the Nigeria Electrification Project is that having a viable project and an approved grant is not always enough. Developers also need access to the capital required to procure equipment and commence implementation. This partnership with Stanbic IBTC is therefore important because it connects our result-based financing framework with commercial finance, giving credible developers a stronger pathway to move projects from approval to delivery and, ultimately, connect more Nigerians to reliable electricity.”
The partnership is expected to address financing constraints that have previously affected the pace of renewable energy project delivery.
The Head, Energy and Infrastructure, Stanbic IBTC Bank , Richard Inegbedion, said the Bank’s participation reflects its commitment to supporting infrastructure development and Nigeria’s energy transition.
“The energy access challenge requires strong collaboration between government, developers and financial institutions. At Stanbic IBTC, we recognize that renewable energy projects require financing structures that understand both the opportunities and the realities of the sector. Through this partnership with REA, we are creating a financing platform that can help eligible developers access the capital they need to execute projects, while contributing to the development of sustainable energy infrastructure and economic activity across Nigeria.”
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Representing the renewable energy developer community, Hakeem Shagaya, Managing Director/CEO, Asolar Systems Nigeria Limited, said appropriately structured financing would be critical to delivering renewable energy solutions at the scale required under DARES.
“For developers, access to finance is one of the most important factors determining how quickly an approved renewable energy project can move into implementation. A financing framework that is aligned with REA’s result-based structure can significantly improve our ability to procure equipment, mobilize resources and deliver projects within the required timelines. We welcome this partnership because it brings the developer, government and financial sector closer together around a common objective — delivering reliable electricity to communities that need it.”
Beyond lending, Stanbic IBTC will support the transaction through a collection platform designed to enhance financial inclusion and project sustainability, as well as financial advisory solutions, including linking developers with Original Equipment Manufacturers (OEMs) and providing international trade tools where practicable. REA will continue to provide programme-side oversight through developer prequalification, project approvals, grant agreements, authentication of relevant documentation, monitoring of connections and Independent Verification Agent (IVA) verification.
The collaboration is expected to strengthen private sector participation in Nigeria’s electricity access drive by improving access to debt financing, reducing financing-related delays and enabling developers to more effectively mobilize the equipment and resources required to accelerate renewable energy project delivery.
The MoU will remain in force throughout the tenure of the World Bank-funded DARES programme managed by REA and will terminate at the end of the programme and upon full repayment of facilities disbursed under the arrangement, subject to the terms of the agreement.
