Decarbonisation and scaling clean energy are top on the agenda of Nigeria’s FCMB Group in an environment overwhelmingly reliant on fossil fuel. Although the Group has much ground to cover, it has cut its carbon footprint considerably and scaled its financial commitment to businesses committed to clean energy.
First City Monument Bank, a subsidiary of the FCMB Group,
has moved 150 (73%) of its pan-Nigeria branch network from grid/diesel
generators to solar power. As a result, it is ahead of industry peers in the
race toward a low-carbon future where clean energy takes centre stage. The same
applies to its strides in financing renewable energy resources to support
global decarbonisation efforts.
The lender is backing clean off-grid energy solutions to
bridge the supply gap in Africa’s most populous nation as the demand for
household and commercial energy rises exponentially. A radical departure from
the country’s predominant energy source – fossil fuels.
Energy guarantees basic comfort and quality of life. It is
an essential element of contemporary life that fuels productive activities such
as commerce, manufacturing, agriculture, education, healthcare and more. For
example, life without electricity, one of the many forms of energy, is tortuous
and described as living in the dark.
Ladi Balogun, FCMB Group Chief Executive and contributing
expert at the University of Oxford (Leading Sustainable Corporations
Programme), said access to energy drives economic growth and development. He
urged more commitment to clean energy finance to improve the quality of life
and accelerate growth and development in developing and underdeveloped
economies.
Indeed, Nigeria, a developing economy with the lowest access
to electricity globally, according to the Energy Progress Report 2022 by
Tracking SDG 7, will benefit significantly from targeted off-grid
interventions. It would ensure access to electricity for about 92 million
persons out of the country’s 200 million population lacking access to power.
To bridge this gap, First City Monument Bank partnered with
development finance institutions to provide targeted financing to improve
Nigeria’s energy access through mini-grids and energy-efficient projects. The
partner institutions include African Development Bank, Proparco and
International Finance Corporation. In addition, there were project
collaborations with the Nigerian Electrification Programme (NEP) and Nigeria
Energy Support Programme (NESP) under the Rural Electrification Agency, Solar
Naija Programme and the Central Bank of Nigeria.
Yemisi Edun, Managing Director of the Bank, described FCMB’s
bold intervention in the renewable energy sector as the solution to the energy
shortfall challenge facing individuals and businesses in Nigeria. She believes
it will unlock the sector’s potential and pave the way for more private sector
investments in renewable energy projects.
Remarkably, the FCMB Group subsidiary has executed credit
enhancement agreements worth over N21 billion to improve energy supply, enhance
cost efficiency and access to clean energy. Its financing proposition allows
value chain players in the renewable energy sector to access loans of up to 70%
of their project cost without collateral under the World Bank/Rural
Electrification Agency (REA) of Nigeria scheme.
Between June and July this year, the lender provided credit
lines worth about N1.7 billion to firms operating in the renewable energy
sector. Out of the funds, over N265m went into mini-grid projects, with a total
PV capacity of 392KWp, in Rivers, Niger, Ebonyi state and Ondo States. It also
financed three hybrid energy efficiency projects in Lagos and Abuja with about
N330m. These projects increased access to sustainable energy sources for about
3,000 households and Small and Medium Scale Enterprises (SMEs) across the
country. They now enjoy a constant electricity supply from clean and
environmentally friendly solar, hydro and biomass sources.
A purpose beyond profit corporation, FCMB Group is building
and driving an ecosystem that fosters inclusive and sustainable growth across
Nigerian communities.
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