Nigeria Invests $2.5B For African Power; Sector Needs $300B

Nigeria Invests $2.5B For African Power; Sector Needs $300B

Nigerian investment company Heirs Holdings said it will invest $2.5 billion in the recently unveiled Power Africa initiative aimed at bringing electricity to Sub-Saharan Africa, according to a report in domain-b.com.

The U.S. is a major partner in the initiative; President Barack Obama just pledged $7 billion.

Access to electricity isn’t just good for education and business; it will better connect Africa with the global economy, Obama said in South Africa during his recent Africa tour.

The Africa Power initiative is a partnership between the U.S., Ethiopia, Ghana, Kenya, Liberia, Nigeria, Tanzania and the private sector to boost investment in Africa’s power sector over the next five years.

The U.S.’s initial commitment of $7 billion comes with an additional $9 billion to be lined up from private companies, according to the report.

Nigeria-based Heirs invests in African financial services, healthcare, infrastructure, real estate and hospitality, agriculture, oil and gas. Investment extends from start-up ventures to established high-growth companies, the report said.

Heir’s chairman Tony Elumelu, a Nigerian business magnate, said in the report the investment demonstrates his company’s intention to become a significant player in the region’s power sector.

Earlier in 2013, Heirs bought the Ughelli power plant, one of the Nigeria’s largest, with the intention of achieving 1,000-megawatt capacity, according to domain-b.com.

Africa Finance Corporation, a private sector finance institution and key partner in the initiative, said it will invest about $250 million in Ghana, Nigeria and Kenya power and a further $1 billion in sub-Saharan Africa energy projects.

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”AFC will provide additional investments in energy projects far in excess of its commitment to the Power Africa initiative,” said AFC CEO Andrew Alli in the report.

Sub-Saharan African will need more than $300 billion to achieve universal access to power by 2030, according to a report by the International Energy Agency.

”We need more African companies to step up and get involved in Africa’s development,” Elumelu said in the domain-b.com report.