- Konexa has been granted a significant private trade license for renewable energy
- The platform will improve the sustainability of the grid and offer dependable green energy for consumers
- Nigeria Breweries will be linked to the grid with 100% renewable energy for two locations
Konexa, a UK-based integrated energy development and investment platform, has secured a combined USD 18 million investment from climate-centric blended finance fund manager Climate Fund Managers (CFM) and Microsoft’s Climate Innovation Fund. This investment is to establish Konexa’s groundbreaking private renewable electricity trading platform and connect Nigeria Breweries PLC to the grid with 100% green energy supply for two of its breweries. The Project has reached financial close and is set to achieve this milestone.
Konexa is among the few entities to have received a private energy trading license in Nigeria. This license, granted by the NERC (Nigerian Energy Regulatory Commission) in June 2022, enables Konexa to acquire renewable power from IPPs, transport it across the national grid, and sell it to private clients at a competitive price. Transactions will be conducted via a new electricity trading platform, enhancing energy reliability and sustainability for consumers, and contributing to the overall resilience and efficiency of the national grid.
The Project will establish the trading platform and facilitate the transmission of renewable energy from the 30MW Gurara Hydro Power Plant in Kaduna State, Northern Nigeria, to two facilities owned by Nigerian Breweries in Kaduna. Both breweries, which are currently off-grid and powered by fossil fuels, will transition to receiving 100% of their electricity needs from the hydro energy source, operated by North South Power Company Limited. The investment by CFM and Microsoft’s Climate Innovation Fund will support the construction of facilities and the deployment of a Battery Energy Storage Solution to connect Nigerian Breweries PLC into the grid supplied by renewable energy from the Gurara Plant. This will result in an annual supply of 20.5GWh, and the Project will avoid 8,104 tons of CO2 equivalent emissions per year, which is the equivalent of removing 1,800 cars from the road¹.
CFM has invested in the Project via its Climate Investor One (CIO) fund, which is a blended finance facility focused on renewable energy infrastructure in emerging markets. The funding, facilitated via CIO’s Construction Equity Fund, was provided by the European Commission. CIO’s Development Fund, in which the European Commission is an investor, provided development funding for the Project. CFM has provided support on the technical, financial, and ESG aspects of the project development, which has enabled the Project to achieve financial close within just 14 months.
Pradeep Pursnani, CEO of Konexa, said: “We are honored to have received one of the first trading licenses for renewable energy in Nigeria and to be launching our trading platform with the invaluable support of CFM and Microsoft’s Climate Innovation Fund. CFM’s expertise in developing, financing, and structuring renewable energy infrastructure has been crucial to the project’s success, and Microsoft’s commitment to innovation aligns perfectly with our vision. The platform will allow us to incorporate sustainable energy sources into the grid while aiding in the decarbonization of the hard-to-abate commercial and industrial sector.”
Darron Johnson, Regional Head of Investments Africa at CFM said: “In the past, Nigeria has not invested enough in its grid infrastructure, especially in the distribution grid. Konexa’s trading platform will play an important role in filling this gap by efficiently connecting third-party, and in the future, its own renewable energy generation to C&I customers, helping them achieve reliable, cost-effective, and sustainable energy independence while strengthening and enhancing the sustainability of the national grid.”
Brandon Middaugh, Senior Director, Climate Innovation Fund, Microsoft, said: “At Microsoft, our long-term goal is to achieve a state where 100% of our electricity worldwide is generated from zero-carbon sources, and this clean power can reliably reach all customers. With this investment, Konexa’s technology will provide firm, clean power to customers in sub-Saharan Africa, showcasing the impact of innovation and grid modernization.”
Through Konexa’s community development program, two villages in the Kudana region have been connected to electricity. The villages of Chikaji Gwari and Chikaji Tsakiya, with a population of around 1,200, received 200 new connections and the introduction of solar appliances, aided by a financing scheme. Additionally, a savings scheme was established to improve asset ownership and credit access. A program including training initiatives for farming and women’s income-generating activities will help to diversify the community’s earnings beyond agriculture.
CFM previously invested in Konexa’s project to transition drone company Zipline’s Kaduna State operations to 100% solar power; with funding also provided by the European Commission via CIO.
