• 500,000 households to be connected, 2.9m people to be served

Ziggy Ojiegbe

A new financing push led by the International Finance Corporation and Norway’s Norfund is set to expand electricity access to millions of Nigerians living beyond the reach of the national grid, underscoring the growing role of blended finance in tackling one of the country’s most persistent infrastructure gaps.

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The initiative targets the rollout of solar hybrid mini-grids across underserved communities, with the potential to connect about 2.9 million people to reliable electricity. For a country where more than 85 million people still lack dependable power—and where even grid-connected areas face frequent outages—the scale of the intervention reflects both the depth of the challenge and the urgency to address it.

At the core of the programme is a financing structure designed to unlock private investment into Nigeria’s off-grid energy market. The total capital expenditure for the portfolio is estimated at $271 million, with IFC and Norfund jointly providing up to $83.2 million to catalyze deployment. This includes $35.3 million in concessional funding drawn from the International Development Association’s Private Sector Window Blended Finance Facility, alongside additional support from IFC’s own concessional capital platform.

The use of blended finance is central to the model. By combining concessional funds with commercial capital, the structure lowers investment risk and improves the bankability of projects that might otherwise struggle to attract funding. In practical terms, it allows developers to deploy mini-grids in rural and peri-urban communities where demand exists but revenue certainty is less predictable.

Five Renewable Energy Service Companies (RESCOs) are at the forefront of implementation: Darway Coast Nigeria Limited, GVE Projects Limited, Prado Power Limited, PriVida Power Limited and StarTimes Energy. Together, they are expected to develop 315 mini-grid sites, each designed to serve communities that remain disconnected from the national transmission network.

These companies are not new entrants but part of a growing ecosystem of local and regional developers focused on distributed energy solutions. Their role is critical in bridging what is often referred to as the “last-mile” gap in electricity access—areas where extending the national grid is either too costly or too slow to meet immediate needs.

The deployment plan reflects a mix of scale and reach. StarTimes Energy is set to undertake the largest rollout with 95 sites, followed by PriVida Power with 75 and Darway Coast with 63. GVE Projects and Prado Power will each develop 41 sites. Collectively, the projects are expected to deliver nearly half a million new connections to households and small businesses, translating into electricity access for millions of individuals.

For communities, the impact extends well beyond lighting homes. Access to stable electricity can transform local economies by enabling small enterprises to operate longer hours, improving productivity for artisans and traders, and supporting services such as cold storage, telecommunications and digital connectivity. It also reduces reliance on petrol and diesel generators, which remain widespread across Nigeria despite their high operating costs and environmental impact.

From a policy standpoint, the programme aligns with broader efforts by the World Bank Group to accelerate energy access across Africa. It complements existing initiatives such as the Distributed Access through Renewable Energy Scale-up programme, which aims to mobilize private capital and scale off-grid solutions through coordinated public and private sector engagement.

Officials involved in the programme emphasize that electricity access is a foundational driver of economic growth. By improving reliability and lowering energy costs, the initiative is expected to stimulate income-generating activities, strengthen small and medium-sized enterprises and support job creation across local value chains. Employment opportunities are likely to emerge at multiple stages, from construction and installation to long-term operations and maintenance.

For investors, the partnership offers a structured pathway into a market that has historically been seen as high-risk. Norfund, which manages a multi-billion-dollar portfolio focused on sustainable development, views the collaboration as an opportunity to support high-impact projects while crowding in additional capital. The presence of IFC, with its track record in emerging markets, adds further confidence by providing both financing and technical expertise.

The timing of the intervention is also significant. Nigeria’s power sector continues to face structural challenges, including limited generation capacity, transmission constraints and financial shortfalls within the grid system. These issues have made decentralized energy solutions increasingly attractive as a faster and more flexible alternative to traditional infrastructure expansion.

By focusing on solar hybrid mini-grids, the programme taps into a model that is both scalable and adaptable. Systems can be deployed relatively quickly, tailored to community needs and expanded over time as demand grows. This flexibility is particularly important in rural areas, where population density and consumption patterns can vary widely.

The financing structure itself is designed with scale in mind. IFC’s platform-based approach incorporates a revolving mechanism that allows capital to be redeployed as projects mature and generate returns. This not only improves efficiency but also enables continuous expansion without requiring entirely new funding rounds for each phase.

Ultimately, the IFC-Norfund partnership represents more than a single investment programme. It reflects a broader shift in how development finance is being used to address infrastructure gaps in emerging markets—moving away from purely public funding models toward blended approaches that leverage private sector participation.

For Nigeria, where the electricity deficit has long constrained economic potential, the success of such models could prove critical. If effectively implemented, the programme has the potential to demonstrate that off-grid solutions can deliver reliable, affordable power at scale, while also creating a viable investment case for future projects.

As deployment begins, attention will focus not only on the number of connections delivered but also on the durability of the model—whether it can sustain operations, attract follow-on investment and continue expanding access over time. For millions of Nigerians currently without reliable electricity, the outcome could mark a meaningful step toward a more inclusive and resilient energy system.