Nigeria’s $750 million Distributed Access through Renewable Energy Scale-up (DARES) programme has saved more than $100 million within its first two years, following the adoption of a data-driven subsidy system for expanding electricity access.
The savings were achieved through a geographically differentiated subsidy designed to give higher support to companies electrifying harder-to-reach communities, according to VIDA, the digital platform supporting the programme.
DARES is being implemented by the Rural Electrification Agency (REA), with the World Bank as funder. VIDA’s data and software platform supports the programme’s planning, implementation and monitoring throughout its four-year cycle.
Under the subsidy model, developers receive payments based on the difficulty and commercial viability of connecting communities. This is intended to discourage companies from concentrating only on easier and cheaper locations.
“A flat subsidy produces the opposite incentive,” VIDA said, noting that such an approach could lead developers to focus on the least costly areas while consuming a disproportionate share of available funds.
The digital platform has also become a common source of market information for the government and more than 250 private electricity companies participating in the programme.
