Economy
How to Solve Africa’s Power Distribution Problems
By Anastasia Walsh
Electrification is an on-going and foundational investment, and a necessary one to realize all modern-day development objectives. Despite bullish policies, the fact remains that over 640 million Africans lack access to electricity. The effect of this is apparent. It impedes economic growth; it inhibits the advancements of self-reliant local communities, and it threatens national security. African governments are beginning to rethink their electrification plans. Grid modernisation, specifically the deployment of microgrids in rural areas, provides a promising strategy.
The Centralized Utility Model Is Not Adequately Serving Africa’s Needs
Attempting to replicate the centralized utility models implemented in the U.S. and Europe has not succeeded in improving energy access across the continent. Despite this, it seems many governments and utilities wrongly maintain the position that the expansion of the traditional grid infrastructure is the solution. In areas where communities have access to the central grid, they still have to supplement the intermittency of the power with diesel generators. On the flip side, the utilities are financially strained because they are unable to collect revenues from their customers. The low rate of revenue collection is due to the unsustainable tariffs the providers impose on customers as a result of the political pressure exerted on them. This results in the utilities being unable to finance upgrades in infrastructure, further exacerbating the issues.
Those who favor the expansion of the central grid as the most effective means of increasing rates of electrification face the challenge of reconciling two contradicting positions. The first position is that increasing access requires lowering tariffs. The second position is that lowering tariffs will intensify the financial stress utilities are currently under. Neither of these positions is sustainable. The incorporation of microgrids into a hybrid system of electrification is the best solution.
Grid Modernisation and Microgrids
Microgrids are small-scale power grids that run on a combination of solar, wind, or biomass or fossil fuels to provide reliable power. They operate either independently from the main grid or can be synched to it at the same voltage to shift the energy and respond to peaks and troughs in supply and demand. This ensures there is no interruption in power supply, allowing communities to be more energy independent by cutting costs and providing reliable energy access.
Productive Use of Energy (PUE) is Key
The off-grid solar lighting market is thriving thanks to the falling prices of renewable energy equipment. The solar lighting market has been further bolstered by widespread deployment of pay-as-you-go (PAYGO) payment systems that utilize mobile-money technology. These solar devices provide sufficient generation for low consumption needs like household lighting, charging cell phones, and the use of small household appliances. Despite its attractiveness to householders, off-grid solar lighting is currently not scalable. The deployment of microgrids will be necessary to provide the adequate output required to power commercial businesses, hospitals, schools. Demand for electricity from small industry and business, which is classified as the productive use of energy will determine the success of microgrids; without this demand, the deployment of microgrids will not be financially viable. Ensuring the Productive Use of Energy enhances the economic and social development impacts of microgrids and rural electrification in the wider context.
Leading The Way: Kenya and Nigeria
Africa is forecast to be the world’s fastest-growing market for microgrids at a Compound Annual Growth Rate of 27%, representing 1,145MW by 2027. Within the continent, Kenya and Nigeria are at the forefront of the grid modernisation revolution.
With strong renewable energy and microgrid policies, Kenya has doubled its energy access rates since 2014. To reach its goal of 100% electrification by 2030, Kenya should implement a hybrid-decentralized system. This entails a combination of traditional utility distribution and the deployment of an extensive network of microgrids. The prevalent use of mobile money in the region, if harnessed correctly will provide the best means of collecting payment of energy bills. Nigeria similarly has ambitions to drastically increase their generating capacity by 2030 with 30% of that planned to be from renewable sources. Microgrids are expected to provide 5.3GW of this increased generation capacity.
Nation-Specific Policies
To improve energy access, African nations should consider incorporating the following into their policies: First, targeting rural populations for distributed energy via microgrids; then implementing low-cost and low-barrier permitting and licensing rules with standardized quality control and operating requirements; and finally ensuring that electrification strategies are financially viable.
Decentralized/hybrid solutions such as microgrids are the most cost-effective solution. The PAYGO business model provides an efficient means for project developed to collect revenues from their investments. Despite the tendency to paint all sub-Saharan countries with the same brush, as it relates to electrification rates, this is especially inappropriate. When it comes to implementing electrification and grid modernisation strategies, policymakers should consider their countries unique geography, natural resources, climate, population density, and power demand patterns.
Anastasia Walsh is from International Energy Consultant in Johannesburg
By Aduragbemi Omiyale
The Global Banking and Finance Review has named Stanbic IBTC Capital, a subsidiary of Stanbic IBTC Holdings, as the Best Investment Bank in Nigeria for 2026.
The leading financial publication picked Stanbic IBTC Capital for the honour in recognition of its commitment to leadership and excellence in Nigeria’s investment banking sector.
The selection process involves an extensive evaluation of performance across critical metrics, including innovation, client service, financial health, and industry advancement.
Stanbic IBTC Capital’s accolade reflects its strong dedication to delivering capital markets and financial advisory solutions for clients in both the public and private sectors.
The firm has made significant strides in facilitating groundbreaking transactions, offering market-leading expertise in equity, debt, and structured finance, while nurturing the growth ambitions of businesses and institutions across Nigeria.
“We are truly pleased to be acknowledged for our relentless pursuit of excellence in the investment banking arena.
“This honour reflects our commitment to hard work and further establishes the deep trust our clients have in our expertise and service.
“It further motivates us to maintain our dedication to exceptional service, cultivate impactful partnerships, and continue delivering innovative financial solutions that meet our clients’ aspirations,” the chief executive of Stanbic IBTC Capital, Mr Oladele Sotubo, stated.
The Executive Director of Corporate and Transaction Banking at Stanbic IBTC Bank, Mr Eric Fajemisin, on his part, said, “Receiving this esteemed acknowledgement from the Global Banking and Finance Review Awards underscores our commitment to driving innovation and excellence within Nigeria’s investment banking landscape.
“This accolade highlights the significant role our skilled team plays in fostering economic growth and stability.
“We are dedicated to delivering exceptional value to our clients, which not only supports their financial success but also contributes to the broader development of the nation’s financial ecosystem.”
The Global Banking and Finance Review annually celebrates institutions that demonstrate quality, innovation, and contributions to the advancement of banking and financial services worldwide.
Now in its 16th edition, the awards honour organisations that uphold outstanding service standards, strategic execution, and industry leadership.
By Aduragbemi Omiyale
The Governor of Rivers State, Mr Siminalayi Fubara, has presented the 2026 Appropriation Bill to the Rivers State House of Assembly.
The 2026 budget estimate of N1.85 trillion, christened Budget of Resilience for Growth and Development, was presented to the state parliament on Friday.
Mr Fubara stated that the proposed spending for the 2026 fiscal year represents a 24.49 per cent increase over the adjusted 2025 budget, driven by anticipated growth in Federation Account Allocation Committee (FAAC) allocations, derivation revenue and internally generated revenue.
He informed the lawmakers that the state hopes to earn N487.61 billion from internally generated revenue, N936.05 billion from FAAC allocations, derivation funds, Value Added Tax (VAT) and exchange gains, and N382.48 billion from capital receipts, including loans, grants and asset sales.
According to him, N413.11 billion is for recurrent expenditure and N1.405 trillion for capital projects, underscoring his administration’s commitment to accelerating development across the state.
He added that personnel costs would gulp N154.77 billion, while N15.22 billion would fund new recruitments, stating that the budget also provides for pensions, gratuities, death benefits and debt servicing.
Governor Fubara further proposed a 50 per cent increase in overhead expenditure for Ministries, Departments and Agencies (MDAs) to strengthen their operational capacity immediately after the budget is signed into law.
He also stated that the largest allocation under the capital budget is the Works and Infrastructure sector with N533.32 billion, followed by Education with N315 billion and Healthcare with N105.43 billion.
In addition, N41.44 billion is for the Rivers State House of Assembly, N30 billion for the Judiciary, N19.26 billion for Agriculture, N15 billion for Power, N8.5 billion for Chieftaincy and Community Development, N7.98 billion for Sports, N7 billion for Youth Development, N6.5 billion for Women Affairs, and N6.61 billion for Environment and Sustainable Development.
The Governor noted that the budget was designed to sustain economic growth, expand critical infrastructure and improve the welfare of residents, pointing out that it builds on the achievements of his administration despite the challenges experienced by the state.
According to him, the budget prioritises the completion of ongoing road projects, new infrastructure investments, improved education and healthcare services, job creation and expanded economic opportunities for residents.
Describing the proposal as a people-centred budget, he assured Rivers people that every public fund would be judiciously utilised to deliver quality services, attract investment and stimulate inclusive development.
Mr Fubara acknowledged the delayed presentation of the budget and appealed to members of the House of Assembly to give the appropriation bill speedy consideration and passage to facilitate timely implementation.
In his remarks, the Speaker of the Rivers State House of Assembly, Mr Martin Amaewhule, acknowledged that the 2026 Appropriation Bill was presented later than expected but assured the Governor that the legislature would expedite its consideration in the interest of the people of Rivers State.
By Adedapo Adesanya
The Securities and Exchange Commission (SEC) has unveiled plans to make sustainability reporting mandatory for large public interest entities from 2027.
This comes as Nigeria moves to align its corporate disclosure framework with global environmental, social and governance (ESG) reporting standards.
The phased implementation will begin with voluntary adoption by early adopters and large public interest entities before becoming mandatory in 2027. The requirement will extend to other public interest entities in 2028 and small and medium-scale enterprises (SMEs) by 2030.
The Director-General of the SEC, Mr Emomotimi Agama, disclosed this at the 2026 Financial Institutions Training Centre (FITC) Sustainability and ESG Conference 3.0, themed ‘Building a Sustainable Africa: Integrating Environmental Stewardship, Social Investment, and Strong Governance for a Prosperous Future’ in Lagos.
Mr Agama said Nigeria’s sustainability disclosure regime is being aligned with the International Sustainability Standards Board (ISSB) framework, including IFRS S1 and IFRS S2, which have emerged as the global benchmark for sustainability reporting.
He said that institutional investors increasingly consider ESG performance a key determinant of capital allocation rather than a peripheral corporate responsibility issue, noting that the price of entry is disclosure.
He said the reforms would strengthen investor confidence and position Nigerian businesses to access global capital markets, where sustainability disclosures are becoming an essential investment requirement.
According to him, Nigeria’s capital market has recorded significant expansion, with market capitalisation growing from about N130 trillion to nearly N160 trillion following recent market reforms, while assets under management have surpassed N9 trillion.
To deepen sustainable finance, Agama said the commission was promoting infrastructure, green and municipal bonds, alongside infrastructure-focused investment funds, to mobilise long-term capital for critical national projects.
He added that the commission would also encourage investments in the blue economy and support financing for the power sector through green energy bonds, project bonds and public-private investment structures.
The SEC chief cited the recent launch of the Nigerian Exchange (NGX) Impact Board as another milestone in advancing sustainable finance and urged companies, regulators and investors to move beyond commitments by embedding sustainability into governance, operations and investment decisions.
