A feasibility study funded by the U.S. Trade and Development Agency (USTDA) has yielded substantial results for Nigeria’s Hotspot Network Limited.
The study has paved the way for financing the deployment of 120 solar-powered telecommunications base stations across 22 states in Nigeria.
These stations are poised to bring last-mile mobile connectivity to remote rural areas that lack reliable telecommunications due to inadequate power infrastructure.
The innovative project is set to leverage renewable energy sources, providing a sustainable solution for improving connectivity in underserved communities.
The financing for this endeavour is a collaborative effort, with Nigeria’s Infrastructure Credit Guarantee Company (InfraCredit) and the Climate Finance Blending Facility, backed by the UK Foreign, Commonwealth and Development Office (FCDO), co-financing the project’s 7-year fixed-rate local currency debt issue. This co-financing initiative has successfully attracted investments from nine Nigerian institutional investors.
USTDA’s involvement in this project stems from a Memorandum of Understanding (MOU) established in June 2021 with InfraCredit. This partnership aims to identify infrastructure projects in Nigeria that could benefit from project preparation funding and subsequent credit enhancements.
“Today we are one step closer to bridging Nigeria’s digital divide. Hotspot’s vision for solar-powered rural telephony is well suited to the needs of Nigeria’s rural communities, and the partnership between InfraCredit and FCDO created an innovative financing approach that further de-risked the project, lowered borrowing rates, and will increase the affordability of mobile services for its end users,” said Enoh T. Ebong, USTDA’s Director.
“USTDA is proud to have provided grant funding for the project’s feasibility study. It is another demonstration of how our Agency helps to catalyse investment for priority infrastructure projects in emerging economies.”
By working together, these entities facilitate the development of bankable infrastructure projects, emphasising solutions originating from the U.S. and introducing them to the market with the support of InfraCredit’s investment-catalysing guarantees.
The sectors of collaboration highlighted in the MOU encompass clean energy and digital infrastructure, underscoring the shared commitment to advancing sustainable and technology-driven initiatives in Nigeria.
