Rensource, a company that provides energy and tech-enabled value services today announced the completion of a $20 million equity financing round. The round was co-led by existing investors CRE Venture Capital and the Omidyar Network, with participation from Inspired Evolution, Proparco,  EDPR, I&P, Sin Capital, and Yuzura Honda. The funds will be used to expand the company’s footprint of microutilities across Nigeria, as well as invest in additional technology infrastructure, as it rolls out new tech-enabled products and services for its merchants.

Nigeria, Africa’s most populous country, only has 12 gigawatts of installed grid capacity, with just one-in-four Nigerians connected to the national power grid. In contrast, South Africa has  50 gigawatts. Rensource launched commercially in 2016 to address this problem. Founded by Ademola Adesina and Jussi Savukoski, it is bridging Nigeria’s power deficit through the delivery of renewable based decentralized energy, focusing primarily on SMEs.

Operating in seven clusters across six states in Nigeria (Lagos, Kano, Ogun, Ondo, Oyo and Edo), the company builds and operates solar hybrid microutilities – a type of energy services provider that localizes energy generation, distribution, and customer service to each community it serves. The company is active in marketplaces that serve over thirty-thousand SMEs. It expects to expand into 100 markets in the country over the next three years.

With the financing secured, Rensource is now expanding its offering beyond energy and entering Nigeria’s nascent offline to online (O2O) space, by offering technology enabled value added services to SMEs in the marketplaces it provides power for. With the launch of this new B2B platform, “Spaces O2O”, merchants will be able to access services that accelerate their productivity growth.

Speaking on the news Ademola Adesina, Founder and CEO of Rensource said, “We believe that simultaneously greening and decentralizing its power infrastructure is the only way to navigate Nigeria out of its current state of energy poverty. Pursuing this with a focus on the millions of small-businesses that drive our economy creates a massive multiplier effect whose benefit accrues to all.

He goes on to add, “Our push into O2O is a natural step that leverages our existing infrastructure to further empower the merchants we serve. We aim to bring connect over one-million merchants in the next 5 years.

As Rensource has grown a leading foothold in the Nigerian market, it has identified gaps in the distribution value chain regarding lack of access to credit, expensive transportation and warehousing, inaccurate data and limited product availability, underpinned by a highly fragmented and multi-layered value chain.

Rensource has historically worked with a variety of stakeholders including community associations, government, regulatory agencies, contractors, and private investors, to build renewable energy projects across Nigeria. In 2018, the company, through a collaboration with the federal government’s Rural Electrification Agency, developed a project in Sabon Gari Market in Kano which resulted in thousands of merchants connecting to Nigeria’s first solar microutility. This first project was followed up by several other as part of the Energizing Economies Initiative (EEI).

Co-founder and Managing Partner of CRE Venture Capital, Pardon Makumbe said, “Rensource’s goal is to offer solutions to the many challenges faced by SMEs in Nigeria, starting with power and expanding to other value-added services. It is a bold and worthwhile undertaking that is creating value for all stakeholders. We are excited to continue this journey with the hyper-competent team at the helm”

Jonathan Kirschner of Omidyar Network said, “Ademola is a true renewable energy revolutionary. We are thrilled to be working with Rensource to deploy affordable and innovative energy solutions to traditional retailers across Nigeria who desperately need it.”

Source: press release

The 9th senate has begun the approval process for the $30 billion loan request made by President Buhari. The senate president referred the request to the Committee on Local and Foreign Loans at the plenary.

Lawan gave the Committee two weeks to work on the loan request and report back to the senate.

Buhari had on November 28, resent the $29.96 billion 2016-2018 external borrowing plan to the senate for consideration and approval. The borrowing plan was a bone of contention between the executive and the 8th Senate led by Dr. Bukola Saraki. The 8th senate has rejected it, citing irregularities and lack of programmes to justify the loan.

Speaking to journalists on Monday in Abuja, Lawan said that the senate will approve the loan but will also make sure that it is judiciously used to implement infrastructural programmes that will benefit the Nigerian people.

“The question of whether we will pass or approve the loan request of the executive arm of government, yes, we will pass it. If we don’t have money and you have projects to build them, how will you provide infrastructure that you need?

“But one thing is that, we are going to be critical that every cent that is borrowed is tied to a project. These are projects that will have spillover effects on the economy and we will undertake our oversight so well to ensure that such funds are properly, prudently, economically and transparently applied on those projects,” he said.

When he was reminded that the loan plan was rejected in 2016, which questions the morality behind its approval now, the Senate President said.

“In 2016, there was no submission of details. This time, I think the executive has learnt its lesson and the letter came with sufficient details. Nothing will really militate against the passage of the loan request.”

As justified as the loan may appear this time, it is coming at a time when the International Monetary Fund (IMF) and economic experts are warning Nigeria against her rising debts. The debt management office said the total external debt stands at $27.16 billion, $4.27 billion out of it is for states and the Federal Capital Territory (FCT).

This warning was also acknowledged by Lawan himself back in October 23, at the opening session of a two-day public hearing organized by the National Assembly on the 2020 Federal Budget held in Abuja. He warned that the Federal Government’s habit of borrowing is hurting the already fragile economy of the country, and recommended a public-private partnership as an alternative to external borrowing to fund infrastructure.

“We cannot continue to borrow to build our infrastructure; I belong to that school of thought that believes that, where we can have a PPP (Public Private Partnership) to build our infrastructure, we should do that.

“I feel that we can build our road from Abuja to Kaduna or to Kano with private fund and they design a way to collect their money, let us do that. Other countries have done that and it worked. As long as we are not shortchanged, we have to look at it, if we have to borrow, where there is another opportunity we should explore that.”

This was the Senate President’s take on external borrowing, just about two months ago. So it was surprising that despite his preachment of PPP in funding infrastructure, he approved the $29.96 billion loan request from the president without hesitation.

Could there be a quid pro quo?

The suspicion of quid pro quo was stirred by the announcement that Buhari has approved N37 billion for the renovation of the National Assembly complex. The N37 billion, although it found its way into the 2020 budget, was not inclusive of the N128 billion allocated for the National Assembly next year. The money instead is part of the 2020 Federal Capital Development Administration budget.

The National Assembly Complex was built in 1999 at the cost of N7 billion.

Speaking about the renovation of the National Assembly and its funding, Lawan said: “We met the president and it was related to the condition of the complex. The president responded and said he was going to renovate the complex. N37 billion was sourced and was given. It was put under the FCT, not national assembly. All we require is to have the complex renovated.”

The $29.96 billion loan approval by the senate and the N37 billion national assembly complex renovation fund approval by President Buhari are all happening at a time when Nigerians are pointing out that the 2020 National Budget was padded by N264 billion, justified by fraudulent projects. So it is believed to be a “give and take deal” between the executive and the National Assembly.

Premiums Times reported how the budget has been inflated through frivolous self-enrichment projects.

President Buhari has assented to the budget not minding the frivolous figures inserted by lawmakers, and the approval of the requested loan will put the nation’s debt profile at $97 billion (N30 trillion), a huge sum that the future generation will live to pay. The major concern expressed by Nigerians so far is that there may be little or nothing to justify the staggering figures of the debt.