© 2019 - International Centre for Investigative Reporting
Durumi N228.4 million solar project broken down four years after launch, as denial trails how fund was spent
FAVOUR Chijioke, 32, moved from one end of the grocery store to the other while she arranged her goods for display and attends to a customer at the same time, the smile on her face is at odds with her current reality.
The mother of two runs a grocery store in Suleja, Niger State, where until last year she spends about N3,500 ($9) weekly on petrol for her generator to be able to power the appliances in her store which is not connected to the national electricity grid.
She decided to opt for a solar mini-grid connection because of the expensive cost of buying petrol to power her generator.
“When I checked the amount I had spent on buying petrol every day I had to buy this solar home system and the situation is far better now than before,” she said.
Whenever Favour turns on her solar micro-grid system of 1.5 kilovolts, Kv, she promptly unplugs the freezer and electric fan in the shop so that she can charge her phone and light the three bulbs.
Though the generator produces noise and fumes, it can power all the appliances in her shop, whereas the solar mini-grid system which costs N74,000($190) offers limited power supply that can barely power the freezer.
Favour is among Nigerians who spend $14 billion yearly on small generators according to a World Bank data.
Huge Investments, Failed Solar Projects
In 2014, the Nigerian government under President Goodluck Jonathan launched Operation Light Up Rural Nigeria, OLRN, a project designed to use renewable energy to provide electricity to 109 rural communities in 16 states but the project was abandoned after the pilot phase.
The project was later renamed Renewable Energy (Solar) Micro Utility (REMU) with three solar mini-grid projects in six geopolitical zones of the country by President Buhari government in 2015.
The first phase was to provide a solar-powered off-grid programme in three rural communities in Abuja, one of the projects was flagged off in Durumi, Mpape, in Bwari Area Council, to deliver electricity to 1,000 households.
Schneider Electric Nigeria Limited, a French-owned renewable solutions company, was awarded the contract to construct Durumi grid at the sum of N228.4 million. Four years after the project was completed, it suffers decay.
When The ICIR visited the community in May, the dilapidated solar hub system had packed up and was under lock and key while the solar panels for the street lights were broken.
David Nyagam a youth leader in the community said the solar project has been a relic for as long as he could remember.
“As you can see this solar project has not been working for over four years so the community had to look to other sources of power supply. There was a public borehole that supplied water for free from the solar mini-grid but since it stopped working we had to start buying drinking water,” he said.
John Nwafor, a resident who operates a phone charging service in the community, said the frequent power cuts and failed solar project has created a boost for his business enterprise despite expenses on petrol for his generator.
“I did not benefit from the solar project because my shop was not connected to the solar mini-grid but my customers have increased because they charge relatively everything from rechargeable torches, phones and radios. I spend more on petrol for the generator but with business flowing, I can’t complain,” he said.
At a plenary hearing at the House of Representatives in March, it was revealed that two companies Schneider Electric Nigeria Limited and Lordezetech International Ltd had received N228.4 million and N218.9 million respectively to set up solar mini-grids in Durumi and Shape communities in Abuja.
Budget records show that N652.4 million was spent on the OLRN project, while REMU received N465.1 million between 2014 and 2017 for solar projects littered across the country, though both programmes have been without funding since 2018.
The reporter reached out to Schneider Electric Nigeria Limited, via email to ascertain why the solar project in Durumi packed up within two years after its completion.
Viviane Mike-Ezeh, the renewable company’s media officer who replied in an email said Schneider’s involvement in the project with the Ministry of Power was mainly on a pro-bono basis.
“Please be informed that for the Light Up Nigeria program, Schneider Electric was requested to provide quality solar equipment, which was done mostly pro-bono.
“The installations require a certain level of maintenance which was not part of Schneider Electric’s scope, however, we endeavoured to provide free training to the community and end-user. Until date, no formal complaint has been received from the client,” the email read.
The ICIR contacted the Special Adviser on Media and Communications to the Minister of Power, Aaron Artimas to verify the claims made by Schneider Electric Nigeria Ltd and also how the money for the project was spent.
He replied in a text message that a project executed pro-bono would be without the required contractual agreements, stating he would check the status of the project and get back to the reporter, but he never did until the time of filing the report.
The ICIR reached out to the Director of Media at the Ministry of Power, Etore Thomas, who referred the reporter to an unnamed official that worked on the project but he said there was no financial record on the OLRN project.
Etore confirmed to The ICIR that the Ministry was not aware of the financial expenditure on the project because they only carried out a supervisory role on the project.
“If there was anything that should be written it is Schneider’s side of the story that you should be talking about not our side because we don’t know if the project is pro-bono or not, what we know is that we supervised the project if you must write anything stick to that side of the story and leave Government out of it,” she said.
In March, the Nigeria Electrification Project, NEP, was launched with a $200 million loan grant to provide off-grid solar energy to over 500,000 people across 105,000 households in rural communities across the country.
With the poor execution of OLRN and REMU projects, it is yet to be seen if NEP will not go down the same road as the others.
An Expensive Alternative
Ifeanyi Valentine, founder of Elixir Innovations Nigeria Limited a renewable company said the increase in the cost of solar panels and batteries from Value Added Tax, VAT, was making access to renewable energy in Nigeria difficult.
“There is a 20 per cent VAT on solar panels and batteries imports which makes it difficult is for business people like us to make this technology accessible for the average Nigerian. We are a consumer state so it is likely that the price of a solar installation will be higher because we have not imported since the onset of COVID-19,” he said.
The operational cost for constructing a 200 kiloWatts solar-diesel hybrid mini-grid is about $2 million while the annual cost for operation including customer service and overhead can also exceed $100,000.
Adetayo Adegbemle, a renewable energy advocate said the removal of VAT by the Federal Government in May was the right action to take.
“The removal of VAT on solar batteries would go a long way in lowering the costs incurred by businesses,” he said.