The Federal Government has signed a Put and Call Option Agreement (PCOA) with two solar power firms from the 14 firms working to build 1,125megawatts (MW) solar plants in Nigeria.
The Managing Director of Nigeria Electricity Bulk Trading Plc (NBET), Mrs. Marilyn Amobi along with the investors signed the first two PCOA with Afrinergia Power Ltd which is building a 50mw solar farm in Nasarawa state, and CT Cosmos doing another 70mw solar project in Plateau state.
The 14 firms had signed a Power Purchase Agreement (PPA) in July 2016 with the NBET to develop the Independent Power Plants (IPPs).
Experts in the electricity industry said the PCOAs serve as indemnity for the project promoters to go ahead with their constructions and ultimately bring their power to the grid.
The then acting Managing Director of NBET, Mr. Adamu Waziri said the firms worth $2.5 billion would be sitting most of the plants in the north where there is higher sunshine.
It was learned that the PCOA could not be signed a month after the PPA was initiated due to protracted negotiations of the Partial Risk Guarantee (PRG), another document that helps to secure the investments at the World Bank and the African Development Bank (AfDB).
The Managing Director of Afrinergia, Mr. Bestman Uwadia said with the signed PCOA, his firm is confident to build and commission its solar IPP in about six months at Onyi, near Keffi with a distance of fewer than 40 kilometers from Abuja.