Nigeria Electrification Program > Frequently Asked Questions – SHS

Solar Home Systems for Households and MSMEs

1. Load demand: there was an inquiry on whether there was a load demand ceiling for the grant?

  • There is no capacity ceiling as it is dependent on customer demand

2. Existing SHS: Will already deployed systems be considered for the grant?

  • Only systems deployed after signing the Agreement between REA and the grantee will be considered.

3. Amount threshold for companies: Inquiry on if a cap existed per company?

  • There is no cap per company, however grant % reduces over time and the range will be reviewed periodically and may change based on market conditions

4. Minimum requirement of 150 systems: Concerns were raised on the minimum requirement of deploying 150 SHS to qualify positing that there are cheap sub-standard products in the market which are competitive. Hence, the cost of meeting the requirement is high. In light of this there were suggestions that the REA and the WB should reconsider the requirement; secondly the REA should spearhead the regulation of SHS systems in the market?

  • Standard Organisations of Nigeria (SON) is in the process of adopting a global standard on SHS. The 150 system monthly sales (on average) is the absolute minimum. The company can become eligible to apply for the OBF once they begin averaging 150 or more for at least 6 months

5. Timelines for verification: What is the timeframe between installation and verification?

  • The maximum time is 4 weeks.

6. Disbursement of Funds: What is the timeline for disbursement

  • The timeline for MSCF is quarterly and for OBF it is based-on a verification timeline that will depend on the completeness of the customer data submitted.

7. Qualification period: How long the qualification for the program is valid for?

  • The qualification is valid for the 5-year period

8. New entrants/Start-ups: Will new entrants and start-ups qualify for the program?

  • The program was not designed for new entrants to the market and not the right tool for start-ups. However, there will be technical support for start-ups and company development down the road

9. Deployment of SHS under the MSCF: Is it a priority to deploy either in rural or urban areas under the MSCF?

  • Systems deployed in both rural and urban areas will be considered

10. Global technical partners: Will a Nigerian company with a global technical partner be considered for the grants?

  • To the extent that the company is the service provider then this company is eligible to apply to the program

11. Evaluation of the systems: How will the systems would be evaluated?

  • There is a Quality Assurance Framework and an IVA in place to carry out evaluations.

12. Currency for disbursement: Will the grant be disbursed in Naira or US Dollar?

  • The disbursement will be in Naira however, the devaluation of the naira will be considered as a case for revising the grant threshold amounts

13. Qualification for the Market Scale Up Challenge Fund: How will companies be considered for the MSCF?

  • Companies will be considered for an invitation to apply for MSCF based on track record and relatively ambitious company profile/ business plans. Read more on the REA website SHS program

14. Subsidy to End-users: Can the 20% grant be given as a subsidy on the cost of the system to end-users?

  • The grant will need to be tailored to improve efficiency and expand business operation of the company and not as a subsidy to the customers. Verification agency will also gather data on pricing and any companies found to be engaging in predatory pricing will be dismissed from the program.

15. How many times can a company apply for the OBF?

  • Registration is done once however disbursements will be on until the grant is phased out

16. Can end users pay for the systems in kind as most of them don’t have money but goods?

  • Technically, the company can decide what payment method to accept but the sustainability of such a business strategy would be highly doubtful