Helsinki-based manufacturer for energy solutions, Wärtsilä signed a contract to build a 75 MW (AC) PV power plant in Nigeria with Pan Africa Solar Ltd.
The company said in a press release said that this will be its first grid-connected utility-scale PV project and Nigeria’s largest PV plant, when completed. The solar park will be built at an unspecified location in in Katsina State, in northern Nigeria.
“Our contract bid was successful because we were able to bring added value to the project in various areas, including local support and technical advisory services. Pan Africa Solar and Wärtsilä are currently finalising the EPC contract and in the meantime, this letter of Award is a major milestone,” said the president of Wärtsilä Energy Solutions, Javier Cavada.
Wärtsilä specified that the project is one of the 14 solar projects that were proposed by IPPs and were selected by the Nigerian Bulk Electricity Trader (NBET), part of Nigeria’s Federal Ministry of Power, in July 2016.
At the time, NBET signed power purchase agreements for as much as 975 MW of solar. The first to be signed was for the above-mentioned Pan Africa Solar’s project. Other companies that signed PPAs with NBET include, among others, Nigeria Solar Capital Partners for a 135 MW solar farm in Ganjuwa, and AfriNigeria who will develop a 50 MW project in Nasarawa state.
In Nigeria, solar IPPs usually negotiate and execute a put and call option agreement (PCOA) with the Federal Ministry of Finance after executing a PPA. The PCOA agreement transfers the payment risk from the state-owned company Nigerian Bulk Electricity Trading Plc (NBET) directly to the ministry. The Put Call Option Agreement (PCOA) is a guarantee mechanism recently adopted by the Nigerian government.
Nigeria aims to cover 30% of total energy capacity through renewables by 2030.
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