Infracredit says enhances credit of Darway Coast green debt issue

INFRACREDIT, a ‘Aaa’rated specialised infrastructure credit guarantee institution has announced the credit enhancement of Darway Coast Nigeria Limited’s green debt issue, under a co-financing arrangement with the £10 million Climate Finance Blending Facility. The facility is funded by the United Kingdom Foreign, Commonwealth and Development Office (FCDO), an initial transaction under Infracredit’s Clean Energy Funding Programme (the Programme).

The Programme seeks to aggregate, de-risk and unlock domestic instilooking tutional investments to support eligible clean energy projects in Nigeria to contribute towards meeting the country’s universal electrification goal by 2030 and the SDG 7 target of ensuring access to affordable, reliable, sustainable, and modern energy for all, whilst putting the country on a path to achieve net zero emissions by 2060.

In February 2022, the UK announced a £10 million local currency blended co-financing facility with Infracredit to help de-risk, reduce the capital cost and catalyse at least an equivalent amount in

investment from domestic institutional investors to support off-grid clean energy companies to increase energy access for unserved and underserved people and small businesses in Nigeria.

It is expected that the Facility will be increased through funding by other development partners to co-finance a pre-assessed initial pipeline of over $128 million (Naira equivalent) that will mobilize at least N26.8 billion ($64 million) of domestic institutional capital to construct 22.7 MW of isolated off-grid renewable energy projects in 580 unserved communities across 32 states in Nigeria, that will connect 172,535 unserved households and small businesses, create 6,977 jobs and reduce 394,403 tonnes of GHG emissions.

This initial transaction under the Programme, was financed with the Ukfunded Facility through a blended instrument enabling domestic institutional investors to directly invest in a 7-year fixed rate local currency debt financing for the project, making it the first-ever certified blended local currency green debt issue for a solar mini-grid project in Nigeria.