The Nigerian Rural Electrification Agency (REA) and CarbonAi Inc. have signed  a memorandum of understanding (MOU) aimed at  to identifying and developing small-scale solar energy projects in Nigeria.

A statement by REA says that the projects will be funded by proceeds from carbon credits that are generated through CarbonAi-financed and developed flare gas capture projects in Nigeria.

Under the MOU, the parties will explore opportunities to finance and develop solar energy projects in unserved or underserved communities near CarbonAi’s flare gas capture projects in Nigeria. REA will apply its knowledge of Nigeria’s rural electrification requirements and programs to identify appropriate project opportunities and liaise with local communities.

CarbonAi, in turn, will apply its carbon finance and project development expertise to finance, design and construct the projects. The company will also quantify, verify and monetize greenhouse gas (GHG) emissions reductions using its proprietary data management platform.

CarbonAi is a world-leading developer of fully integrated GHG reduction projects and GHG emissions quantification and monetization solutions. Based in Calgary and Dubai, the company provides full-cycle flare gas capture services in Africa and the Middle East, from project finance, design and construction to carbon credit quantification, verification and sale. For each project that CarbonAi develops, it invests a portion of carbon credit revenues to help local organizations develop sustainability initiatives through the CarbonAi Climate Dividend Programme.

“We are excited to work with the REA as our CarbonAi Climate Dividend Programme partner in Nigeria,” stated CarbonAi’s Chief Carbon Officer, Yvan Champagne. ”We are strong believers in win-win outcomes, and we believe our Climate Dividend Programme captures the spirit of the energy transition by leveraging immediate reductions in today’s energy system to build the energy system of tomorrow in Nigeria.”

Flaring of gas is a common practice in oil and gas activities worldwide; however, it generates high levels of GHGs and harmful local pollutants, often creating serious local air and water quality issues. According to the statement, Nigeria has the third highest number of gas flares globally, but the country has pledged to eliminate the practice by 2025.

Many communities in Nigeria’s high-flaring regions do not currently have access to reliable electricity. The parties believe this MOU will be an important step in providing reliable renewable energy to local communities that are currently unserved and underserved, while improving local air quality associated with gas flaring.

On his part, Managing Director/CEO of REA, Engr. Ahmad Salihijo Ahmad stated that “REA’s collaboration with CarbonAi is timely and solution-driven. The off-grid space in Nigeria is undergoing commendable growth. With the resultant opportunities, key stakeholders must take the responsibility to leverage these opportunities to accelerate sustainable impact, nationwide. This is another strategic and innovative way to finance climate-resilient infrastructure in Nigeria while alleviating energy poverty.”