United Capital Infrastructure Fund (UCIF) has signed a N5 billion ($3.2 million) revolving, local currency debt facility with Husk Power Systems. It has been described as the largest-ever naira-denominated debt deal in Africa’s community solar mini-grid industry.
Although Sunking, a leading solar home systems provider, secured $80 million in naira-denominated loans earlier this year to expand household solar distribution. The Husk deal is the first structured as a revolving facility dedicated to community solar minigrids.
The transaction, announced on the sidelines of the Africa Climate Summit (ACS2) in Addis Ababa, is the first local debt deal in the sector to introduce a revolving mechanism. Under the structure, Husk will be able to draw down on the capital at least twice during the 10-year tenor, bringing the potential total to N10 billion ($6.4 million).
Initial deployments will fund Husk’s standalone minigrid pipeline in Nigeria. Then it will expand to interconnected minigrids (IMGs) and commercial and industrial (C&I) solar projects.
Access to affordable, long-term local currency financing has long been identified as a major bottleneck to accelerating the minigrid industry in Nigeria. However, the Nigerian government have highlighted community solar minigrids as a critical pathway to expand energy access and drive inclusive growth.
Analysts at McKinsey, in an upcoming report, also identified community mini-grids as one of Nigeria’s least expensive pathways to electrifying the unelectrified population.
United Capital’s first investment in renewable energy
“This transaction underscores our commitment to advancing Nigeria’s renewable energy sector and expanding access to clean, reliable power,” said Uchenna Mkparu, Chief Investment Officer and Fund Manager of UCIF.
He added, “By providing affordable, long-term local currency debt to a market leader like Husk, UCIF is creating impact by enabling scalable, sustainable energy access for households, SMEs, smallholder farmers, and underserved communities across Nigeria. It is our goal to replicate this facility structure to deliver up to 100MW of clean power by 2030.”
Manoj Sinha, Husk’s CEO and Co-Founder, described the deal as a turning point for the industry.
“Access to affordable, long-term, Naira-denominated capital has long been a critical bottleneck to scaling private-sector minigrids in Nigeria,” he said.
“This facility marks a new era for the industry and provides strong momentum for Husk’s Africa Sunshot initiative, under which we aim to build, own, and operate 1,000 minigrids in Nigeria.”
For UCIF, the deal represents its maiden investment in the renewable energy sector. Uchenna also notes that it aligns with UCIF’s mandate to channel long-term local currency financing into sustainable development projects across Nigeria and Sub-Saharan Africa.
