The Climate Investment Funds (CIF) has agreed to provide Nigeria with $50 million to support an African Development Bank-backed program of financial intermediation for renewable energy and energy efficiency through local banks.
The money, being provided under the CIF’s Clean Technology Fund (CTF), is designated to stimulate alternative and efficient ways to generate electricity and to reduce dependence on energy sources which contribute significantly to greenhouse gas emissions.
The CTF money will complement support provided through the AfDB private sector window, to help the country address energy efficiency in critical sectors such as power, agribusiness, transport, telecommunications, and education, by targeting local financial institutions to invest and support the shifts to clean, efficient and affordable energy in the sectors.
The work to improve energy efficiency and increase the use of renewables is in line with the country’s national policy framework designed to lead the country to an ambitious set of energy goals, including rural energy scale-up and actions to ensure energy efficiency through a combination of regulations and incentives at the national scale.
Established in 2008 as one of the largest fast-tracked climate financing instruments in the world, the $7.6 billion Climate Investment Fund provides developing countries with grants, concessional loans, risk mitigation instruments, and equity that leverage significant financing from the private sector, multilateral development banks (MDBs), and other sources.
Five MDBs – the African Development Bank (AfDB), Asian Development Bank (ADB), European Bank for Reconstruction and Development (EBRD), Inter-American Development Bank (IDB), and World Bank Group (WBG) – implement CIF-funded projects and programs.