In a bid to address rising energy costs and promote sustainable alternatives, the Federal Government has launched a N10 billion initiative aimed at converting over one million vehicles to compressed natural gas (CNG) and accelerating the adoption of solar energy systems.
The plan, which provides consumer credit to ease the financial burden on Nigerians, was unveiled on Wednesday in Abuja.
The initiative, called the Credit Access for Light and Mobility (CALM) Fund, is designed to provide affordable credit to private individuals for the conversion of vehicles to CNG and the acquisition of energy-saving solutions like solar systems.
The scheme aims to mitigate the impact of the recent fuel subsidy removal, which has led to soaring transportation costs and increased electricity tariffs.
The CALM Fund is the result of a collaboration between the Ministry of Finance Incorporated (MOFI), the Nigerian Consumer Credit Corporation (Credicorp), and the Presidential Initiative on Compressed Natural Gas (PICNG).
The initial N10 billion fund will be supported by a consortium of private and institutional investors, with an initial N2.5 billion set aside for vehicle conversions.
Speaking at the signing ceremony, Managing Director of MOFI, Dr. Armstrong Takang, highlighted the financial burden many Nigerians face due to the removal of the petrol subsidy.
He explained that the government’s response is to offer consumer credit through the newly established Credicorp, allowing Nigerians to access essential services without the upfront cost.
“Most Nigerians cannot afford to convert their cars to CNG or install solar systems due to the capital-intensive nature of these technologies,” Takang said.
“This fund provides an avenue to spread out the cost through consumer credit, easing the financial pressure on everyday citizens.”
He added that MOFI will continue to aggregate and expand the fund with the aim of attracting more private investments to grow the initial N10 billion, ensuring that more Nigerians can benefit from the programme.
Addressing affordability concerns, Dr. Takang noted that Nigerians are grappling with the increased cost of living, particularly in transportation and electricity.
He said the government’s CNG programme is one solution to these challenges, and the CALM Fund will provide a practical pathway for citizens to access these energy alternatives without having to pay the full amount upfront.
Also commenting on the programme, Director/CEO of PICNG, Engr. Michael Oluwagbemi, emphasized the importance of reducing the high cost of mobility for Nigerians.
He revealed that the partnership with Credicorp would enable private individuals to convert their vehicles to CNG without the need for immediate payment.
“The cost of CNG conversion is elevated given our current realities,” Oluwagbemi said.
“This programme provides immediate access to consumer credit, allowing conversions at PICNG-accredited centres through Participating Financial Institutions (PFIs). We expect to convert an additional 500,000 to one million vehicles in the coming months.”
The initiative is seen as a significant step toward promoting CNG as a cleaner, cheaper alternative to petrol while supporting Nigeria’s energy transition goals.
The government has set an initial target of converting one million vehicles, with the new plan expected to push that number even higher.
Managing Director of Credicorp, Engr. Uzoma Nwagba, further elaborated on the programme’s aim to improve the quality of life for Nigerians by making essential energy solutions more accessible.
He explained that the consumer credit system is tailored for individuals with steady incomes, including public and private sector employees, as well as small business owners.
“This programme ensures that Nigerians no longer have to save up for months or years to access goods and services that improve their lives,” Nwagba stated.
“It will boost demand for CNG conversions and solar energy solutions, creating a ready market for manufacturers and contributing to the growth of domestic industries.”
With the Federal Government’s focus on energy sustainability and affordability, the CALM Fund is expected to play a crucial role in cushioning the effects of rising energy costs while pushing Nigeria closer to its renewable energy targets.
The introduction of consumer credit for energy conversions is seen as a strategic move that not only reduces the financial burden on Nigerians but also encourages the growth of local manufacturing for CNG kits and solar panels.
This initiative comes at a time when many Nigerians are seeking alternatives to the high cost of fuel and electricity, and the Federal Government’s proactive approach to solving these challenges is being lauded as a step in the right direction.
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