Konexa has achieved financial close on a private renewable electricity trading platform that will connect Nigeria Breweries to the power grid, supplying green energy to two locations.
Konexa, a UK-based integrated energy development and investment platform achieved financial close on a combined $18 million investment from finance fund manager Climate Fund Managers (CFM) and Microsoft’s Climate Innovation Fund to establish the platform project.
The platform will connect Konexa’s inaugural client, Nigeria Breweries PLC, to green energy supply for two of its breweries.
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 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.
With an annual supply of 20.5GWh, the Project is expected to avoid 8,104 tons of CO2 equivalent emissions per year, the equivalent of taking 1,800 cars off the road.
Pradeep Pursnani, CEO of Konexa, said: “We are honoured to have been awarded 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 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 decarbonize the hard-to-abate commercial and industrial sector.”
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The partnership comes after Konexa was awarded a private energy trading license in Nigeria, awarded by the NERC (Nigerian Energy Regulatory Commission) in 2022.
The licence allows Konexa to source renewable power from Independent Power Producers (IPPs), transport it across the national grid and sell it to private clients at a competitive price.
Transactions will be facilitated via the 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 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 to the grid.
CFM invested in the Project via its Climate Investor One (CIO) fund, an EU-supported blended finance facility focused on renewable energy infrastructure in emerging markets.
The funding, which was 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 supported the technical, financial and ESG aspects of the project’s development, helping the project achieve financial close within 14 months.
Darron Johnson, Regional Head of Investments 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.”
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.
