Climate Fund Managers in Nigerian power sector deal
Climate Fund Managers in Nigerian power sector deal
Konexa has received an $18 million investment from Climate Fund Managers (CFM) and Microsoft’s Climate Innovation Fund.
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Konexa, a UK-based integrated energy development and investment platform, has achieved financial close on an $18 million investment from Climate Fund Managers (CFM) and Microsoft’s Climate Innovation Fund. This investment will establish Konexa’s private renewable electricity trading platform and connect its inaugural client, Nigerian Breweries, to the grid, with 100% green energy supply for two of its breweries.
Konexa is one of the few companies to have been awarded a private energy trading licence in Nigeria. The licence, which was awarded by the Nigerian Energy Regulatory Commission (NERC) in June 2022 allows Konexa to source renewable power from IPPs, transport it across the national grid and sell it to private clients. Transactions will be facilitated via a new electricity trading platform, enhancing energy reliability and sustainability for off-takers and contributing to the overall resilience and efficiency of the national grid.
The project will facilitate the transmission of renewable energy from the 30MW Gurara Hydro Power Plant in Kaduna State, Northern Nigeria, to two of Nigerian Breweries’ Kaduna facilities. Currently off-grid and powered by fossil fuels, both breweries 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.
CFM invested in the project via its Climate Investor One (CIO) fund.
Pradeep Pursnani, CEO of Konexa said, “We are honoured to have been awarded one of the first trading licences 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 instrumental in shaping the project’s success, and Microsoft’s commitment to innovation aligns seamlessly with our vision. The platform will enable us to integrate sustainable energy sources into the grid while helping decarbonise the hard-to-abate commercial and industrial sector.”
Darron Johnson, regional head of investments for Africa at CFM said, “Historically, Nigeria has suffered from under-investment in its grid infrastructure, particularly when it comes to the distribution grid. Konexa’s trading platform will play a pivotal role in bridging this gap by efficiently connecting third party, and, in 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 at Microsoft’s Climate Innovation Fund, said, “At Microsoft, our long-term vision is to reach a state where, on all the world’s grids, 100% of our electricity, 100% of the time, is generated from zero-carbon sources and that clean power can reliably reach all customers. With this investment, Konexa’s technology will deliver firm, clean power to customers in sub-Saharan Africa, demonstrating the impact of innovation and grid modernisation.”
CFM previously invested in Konexa’s project to transition drone company Zipline’s Kaduna State operations to 100% solar power.
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