Hotspot Network Limited, Nigeria

Financial Close Jun. 2023

Under Construction

₦955m Private Capital Mobilised

Green Certified

324kw Capacity

120 Sites

720 Jobs to be Created

8.34 Tonnes of GHG Emissions to be reduced

Project Description

The project will construct, install and commission solar powered base stations (sites) in 120 communities across 22 States in Nigeria. Hotspot is a telecommunication infrastructure and solar-powered rural telephony network provider, using renewable energy and climate-smart technology in operating telecom sites in off-grid rural parts of Nigeria. Under the Project, Hotspot established the special purpose vehicle, Micropolitan Mobile Connectivity Limited to raise local currency finance from the debt capital markets, to build, own, and operate solar-powered mobile network base stations in select rural communities in collaboration with MNOs in Nigeria.

FAct Sheet

Project Overview

Financing Structure

The project was financed through a blended instrument, with the UK funded Climate Finance Blending Facility enabling a 7 year fixed rate local currency debt financing for the project by investing in the subordinated debt tranche, making it the first ever certified blended local currency green debt issue for a solar powered base stations project in Nigeria.

The Facility’s subordinated first loss capital helped de-risk and reduce the capital cost of the project by unlocking InfraCredit’s AAA rated guaranteed senior green bonds that crowded in first-time matching investments from 9 domestic institutional investors in a solar powered base stations for unserved markets.

Illustrative Transaction Structure

Expected Impact

The project will create up to 720 temporary and permanent jobs and avoid 8.34tCO2e of GHG emissions. Over the next 10 years, the project is expected to enable between 9 and 16 million new mobile subscribers and 6 million new data users.

The Hotspot Project complies with the Solar Sector Criteria of the Climate Bonds Standard, and its financing has been officially labelled and certified ‘Green’ by the Climate Bonds Initiative.

The Rural Telephony Project will have environmental benefits that align with the objectives of the Paris Agreement and Nigeria’s Nationally Determined Contributions (2021) to decarbonize the energy sector through a transition pathway, mitigating GHG emissions, and enhancing climate resilience which would simultaneously have a positive direct contribution to the United Nations Sustainable Development Goals (SDGs) 3, 4, 5, 6, 7, 8, 11, 12, 13 and 17 as identified in the Green Bond Framework.