Nigeria Taps Opportunity in Undergrid Mini-grid to Boost Power Supply

Peter Uzoho

No fewer than 230 households and 60 commercial and public enterprises, including healthcare centres, are currently being served by Nigeria’s first undergrid mini-grid technology in Mokoloki, a rural community in Ogun State, after three months of operation in the area.

The project formally launched recently was a product of a partnership by Rocky Mountain Institute (RMI), Ibadan Electricity Distribution Company (IBEDC), and Nayo Tropical Technology (Nayo Tech) with active support of the Rural Electrification Agency (REA).

According to a joint statement, RMI, IBEDC, and Nayo Tech, with support from REA, joined forces to accelerate the commercial deployment of undergrid mini-grid technology in the Nigerian energy sector.

It stated that the Mokoloki project demonstrates a financially-viable business model that could provide electricity access to millions living in underserved rural communities throughout the country.

“Part of the work we do at REA is creating an enabling environment for private sector-led projects to thrive. We are delighted to witness strategic collaborations geared toward accelerating energy access in unserved and underserved communities across Nigeria,” Managing Director of REA, Mr. Ahmad Salihijo, said.

He added: “What makes this project unique, beyond being Nigeria’s first commercial undergrid minigrid in a rural community, is the social and economic transformation that the project ultimately brings to the Mokoloki community.

“I commend RMI, IBEDC, Nayo Tech and all other stakeholders involved in carrying out this feat.”
The Chief Operating Officer, IBEDC, Mr. John Ayodele, said, “By the time this project stabilises, Mokoloki will be like a town. They will have more regular power supply than cities.”

IBEDC was the first Nigerian distribution company to initiate a tripartite contract negotiation with a rural community as required for interconnected minigrids by regulation.

Also speaking, the Chief Executive Officer of Nayo Tech, Anayo Okenwa Nas, said: “We are excited to be in the forefront of undergrid minigrid development in Africa as a scalable and sustainable business opportunity with good social impact on our host communities.”

Mokoloki, was previously struggling with intermittent electricity access and poor voltage quality prior to this project, a situation that has now gone for good.

However, its bustling market and proximity to main trade routes promised major commercial activity, making it an ideal site for an undergrid mini-grid, as explained in the newly released project brief and article.

According to the Principal at RMI, Mr. James Sherwood, “Mokoloki’s undergrid mini-grid shows how utilities, developers, and communities can collaboratively develop innovative power solutions, and this willingness to test new approaches has unlocked a new option for increasing energy access.”

RMI hoped that the success of the source of power supply would jump-start similar partnerships that serve customers across Nigeria and sub-Saharan Africa.

Using a modular design approach, the solar-hybrid minigrid is initially providing 100KW of generation for an estimated peak load of 88KW, with an expansion plan in place for anticipated load growth.

Both IBEDC and Nayo Tech intend to scale up their undergrid portfolios and are actively exploring project and investment opportunities.

The statement explained that the undergrid minigrid pilot embodies recommendations from recent reports by RMI and partners at EMRC, Cleantech Hub, and All On.

Under the Grid outlines, the business opportunities for undergrid mini-grid development in sub-Saharan Africa, while electrifying the underserved expands on specific business models to guide project implementation.

An estimated 40 million rural residents are underserved by the main grid in Nigeria. Of these, close to 35 percent could be served by over 4,000 commercially viable undergrid minigrid systems.