Amendment 02 to RFP 72067424R00008.pdf

RFP Number: 72067424R00008 RFP Title: Empower Nigeria RFP Issuance Date: May 8, 2024 Questions Due Date and Time: May 17, 2024, 6:00pm EST Closing Date and Time for Receipt of Proposals: June 7, 2024, 6:00pm EST June 21,2024, 6:00pm EST To All Prospective Offerors:

Strikethrough text represents narrative that is deleted in this Amendment 2 to the RFP. Changes, including additions, have been highlighted in yellow.

The United States Government, represented by the U.S. Agency for International Development (USAID) anticipates awarding one Cost-Plus-Fixed-Fee (CPFF) completion contract with an estimated period of performance of five (5) years for the implementation of the Empower Nigeria activity. Subject to availability of funds, the estimated cost range for this contract is $75,000,000.00

- $85,000,000.00.

The procurement will be conducted through full and open competition, under which any type of organization (large or small commercial [for profit] firms, educational institutions, and nonprofit organizations) is eligible to compete. The procedures set forth in Federal Acquisition Regulation (FAR) Part 15 apply. The competition will utilize a Highest Technical Rated with Fair and Reasonable Price and Realistic Cost (HTR) process, not a tradeoff process. In this process, USAID is concerned with getting the best technical solution that has a fair and reasonable price and realistic cost. There will not be a tradeoff to justify paying a premium for a higher technical rated proposal.

Section L of the RFP sets forth all instructions for the preparation and submission of required proposal content, including critical dates/times for the submission of questions, and the proposal submission closing date and time. Section M states the criteria by which proposals will be evaluated.

Any questions related to this RFP must be submitted by email to proposals@usaid.gov with a copy to Rachel Modise at rmodise@usaid.gov by the time and date specified above. No questions will be accepted after the date and time stated above.

This RFP can be viewed and downloaded from https://sam.gov/content/home. USAID bears no responsibility for data errors resulting from transmission or conversion processes. Further, be aware that amendments to solicitations are occasionally issued and will be posted on the same website from which you downloaded the solicitation. USAID advises to regularly check the above website for amendments.

mailto:proposals@usaid.gov mailto:rmodise@usaid.gov https://sam.gov/content/home

RFP No. 72067424R00008

The principal geographic code for this contract is 935. The North American Industry Classification System (NAICS) code for this activity is 541690 Other Scientific and Consulting Services. Under 13 CFR 121.201, the U.S. Small Business size standard is $19M of annual receipts.

Issuance of this solicitation does not in any way obligate the U.S. Government to award a contract nor does it commit the U.S. Government to pay for costs incurred in the preparation and submission of a proposal. Award of a contract under this RFP is subject to availability of funds and other internal USAID approvals. Furthermore, the Government reserves the right to reject any and all offers, if such action is considered to be in the best interest of the U.S. Government. USAID reserves the right to award this contract without discussions.

Thank you for your interest in USAID programs.

Sincerely, Nancy Kleinhans Contracting Officer

Offers must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended, by one of the following methods:

(a) By completing items 8 and 15, and returning or (c) By separate letter or electronic communication which includes a reference to the solicitation and amendment numbers. FAILURE OF YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to change an offer already submitted, such change may be made by letter or electronic communication, provided each letter or electronic communication makes reference to the solicitation and this amendment, and is received prior to the opening hour and date specified.

E. IMPORTANT: Contractor is not is required to sign this document and return copies to the issuing office.

AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT 1. CONTRACT ID CODE

2. AMENDMENT/MODIFICATION NUMBER 3. EFFECTIVE DATE 4. REQUISITION/PURCHASE REQUISITION NUMBER 5. PROJECT NUMBER (If applicable)

7. ADMINISTERED BY (If other than Item 6) CODE

STANDARD FORM 30 (REV. 11/2016)

Prescribed by GSA FAR (48 CFR) 53.243

FACILITY CODE

9A. AMENDMENT OF SOLICITATION NUMBER

9B. DATED (SEE ITEM 11)

10A. MODIFICATION OF CONTRACT/ORDER NUMBER

10B. DATED (SEE ITEM 13)

11. THIS ITEM ONLY APPLIES TO AMENDMENTS OF SOLICITATIONS

The above numbered solicitation is amended as set forth in Item 14. The hour and date specified for receipt of Offers is extended. is not extended.

12. ACCOUNTING AND APPROPRIATION DATA (If required) copies of the amendment; (b) By acknowledging receipt of this amendment on each copy of the offer submitted;

13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS.

IT MODIFIES THE CONTRACT/ORDER NUMBER AS DESCRIBED IN ITEM 14.

CHECK ONE A. THIS CHANGE ORDER IS ISSUED PURSUANT TO: (Specify authority) THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT ORDER

NUMBER IN ITEM 10A.

B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation data, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR 43.103(b).

C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:

D. OTHER (Specify type of modification and authority)

Except as provided herein, all terms and conditions of the document referenced in Item 9A or 10A, as heretofore changed, remains unchanged and in full force and effect.

15C. DATE SIGNED

15A. NAME AND TITLE OF SIGNER (Type or print)

16C. DATE SIGNED

16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print)

14. DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings, including solicitation/contract subject matter where feasible.)

PAGE OF PAGES

6. ISSUED BY CODE

8. NAME AND ADDRESS OF CONTRACTOR (Number, street, county, State and ZIP Code) (X)

CODE

15B. CONTRACTOR/OFFEROR

(Signature of person authorized to sign)

16B. UNITED STATES OF AMERICA

(Signature of Contracting Officer)

Previous edition unusable

N/A

Nancy Kleinhans Regional Contracting Officer

This RFP amendment 02 includes questions received and USAID answers on Solicitation number 720-674-24-R-00008 and updates Attachment J.2.2 with the correct document, Past Performance Information.

Attachments include: PDF with Questions and Answers, RFP Amendment 02 with highlighted changes and a new Past Performance Information sheet.

Except as specified herein, all terms and requirements of RFP 720-674-24-R-00008 remain unchanged.

USAID/Southern Africa Regional Office of Acquisition and Assistance 100 Totius Street, Groenkloof PO Box 43 Pretoria, South Africa

TO ALL OFFERERS

See Item 6

REQ-674-24-000106

720-674-24-R-00008

1 1

See Item 16C

06/07/2024

Nancy Kleinhans Digitally signed by Nancy Kleinhans Date: 2024.06.07 12:34:33 +02'00'

SECTION B: SUPPLIES OR SERVICES AND PRICE/COSTS

B.1 PURPOSE

The purpose of this contract is to increase the availability of and access to affordable, reliable, sustainable and clean energy in Nigeria and provide other services described in Section C.

B.2 CONTRACT TYPE

This is a Cost-Plus-Fixed-Fee (CPFF) completion contract with an estimated period of performance of five (5) years. For the consideration set forth below, the contractor must provide the deliverables or outputs described in this contract and comply with all contract requirements.

B.3 ESTIMATED COST, FIXED FEE, AND OBLIGATED AMOUNT

(1) The estimated cost for the performance of the work required hereunder, exclusive of fee is [$ To be completed prior to award]. The fixed fee is [$ To be completed prior to award]. The total estimated cost-plus fixed fee is [$ To be completed prior to award].

(2) The amount currently obligated and available for reimbursement of allowable costs incurred by contractor (and payment of fee, if any) for performance hereunder is [$ To be completed prior to award].

The contractor must not exceed the aforesaid obligated amount, nor will the U.S. Government (USG) be responsible for costs incurred should the contractor do so.

(3) Funds obligated hereunder are anticipated to be sufficient through [To be completed prior to award].

Funding for this contract will be on an incremental basis, subject to availability of funds.

B.4 CONTRACT BUDGET

The budget for this contract is as follows: [To be completed prior to award, will be broken out by option years if the successful offeror requires use of the Foreign Assistance Waiver described in Section F]

CLIN

Outcomes 1: Enabling Environment Enhanced for Sector-wide Impact and Improved Investment Opportunities, Outcome 2: Power Supply is Expanded with Increased Operational Capacity, Reliability and System-wide Integration, and Outcome 3: Offgrid Clean Generation, Connections and Utilization Increased

Total

0001a Direct Costs $TBD

0001b Indirect Costs $TBD

0001c Fixed Fee $TBD

CLIN

Outcome 4: Improved Financial and Operational Performance of Nigerian Distribution Companies (DISCOs)

$TBD

0002a Direct Costs $TBD

0002b Indirect Costs $TBD

0002c Fixed Fee $TBD

TOTAL ESTIMATED COST-PLUS FIXED FEE $TBD

B.5 INDIRECT COSTS

(a) Pending establishment of revised provisional or final indirect cost rates, allowable indirect costs will be reimbursed on the basis of the following negotiated provisional or predetermined rates and the appropriate bases:

[To be completed prior to award]

B.6 COST REIMBURSABLE

The U.S. dollar allowable costs will be limited to reasonable, allocable and necessary costs determined in accordance with FAR 52.216-7 Allowable Cost and Payment (AUG 2018) and FAR 52.232-22, Limitation of Funds (APR 1984), and AIDAR 752.7003, “Documentation for Payment.”

B.7 PAYMENT OF FIXED FEE

Payment of fee, referenced above in B.3 and B.4, will be in accordance with FAR 52.216-8. The Contracting Officer, in consultation with the Contracting Officer’s Representative (COR) and at the request of the contractor, may modify the below fee schedule, based upon changes in underlying assumptions, the development context or other extenuating circumstances.

Upon successful completion of a deliverable, the contractor must provide evidence of its achievement to the COR for verification. Upon receipt of concurrence by the COR, the contractor may submit an invoice for the amount of the fee associated with the deliverable.

In the event of discontinuance of the work in accordance with the clause of the contract entitled FAR 52.249-6 Termination (Cost Reimbursement), the fee must be re-determined by mutual agreement equitably to reflect the reduction in the work actually performed. The amount by which such fee is less than, or exceeds, payments previously made on account of the fee must be paid to, or repaid by the contractor, as applicable.

[The budget must include the proposed total fixed fee amount in accordance with FAR 15.404-4. The Offeror must submit a completed annual deliverable and fee tables. Fee included must be in line with objectives and results in Section C, and broken out by contract year with proposed corresponding fee amounts. Proposed deliverables for payment of fee cannot include more than 30% of fee allocated to progress reporting such as quarterly, annual or other technical reports. Annual deliverables may break down results included in Section C. If the successful offeror requires use of the Foreign Assistance Waiver, the below tables will be modified to use options described in Section F ]

Contract Year 1:

No. Description of Deliverable Method of Verification Amount of Fee

[Offeror to propose inputs to this table]

Contract Year 2:

No. Description of Deliverable Method of Verification Amount of

Contract Year 3:

Contract Year 4:

Contract Year 5:

No. Description of Deliverable Method of Verification Amount of

B.8 KEY CONSIDERATIONS FOR DEVELOPMENT IN A DYNAMIC ENVIRONMENT

Due to the somewhat fluid nature of the Nigerian political, security and development context, the Empower Nigeria contractor must be able to adapt to changing circumstances on the ground. Adaptive management will be required from the implementer to maintain, sustain, or expand development gains achieved through activity implementation.

The contractor must anticipate the need to adapt to changing conditions on the ground either of a positive or negative nature to achieve the contract's objectives. These objectives are defined in Section C.

Implementation of these changes will be governed by FAR 52.243-2 (Alternate I) Changes Cost Reimbursement. The changes must be within the general scope of this contract. These changes will be made to address changing circumstances in Nigeria. Examples of the circumstances include but are not limited to:

Data indicates and the Mission Director determines in writing that there is a high probability of a crisis developing in the operating environment that affects the contract’s objectives and any of the results, requiring adjustments to ongoing programming.

The purpose of this section is to inform the contractor of the somewhat fluid nature of development work of Nigeria and the likely need to adapt to changing circumstances while still achieving the contract’s objectives.

There may be other needs that require the use of the changes clause but the extreme fluidity of the operating environment in Nigeria warrants this section in order to increase the probability of success in achieving the contract’s objectives.

B.9 MULTI YEAR CONTRACT

This contract is subject to the requirements of FAR 17.106. In determining cancellation ceilings, the Contracting Officer has determined that – considering reasonable pre-production or startup, labor learning, and other nonrecurring costs to be incurred and which normally would be amortized – the cancellation ceiling for each contract year after the first is $0.

[END OF SECTION B]

SECTION C: DESCRIPTION/SPECIFICATIONS/STATEMENT OF WORK (SOW)

C.1 INTRODUCTION

The Empower Nigeria program is Power Africa’s flagship program in Nigeria, furthering Power Africa’s work of increasing available on- and off-grid generation capacity, access to electricity and supporting Nigeria’s transition to a low-carbon electricity system. This contract will drive economic growth and reduce the energy poverty gap in Nigeria by increasing the availability of and access to reliable, affordable and clean electricity in Nigeria. The contract will achieve this goal through four mutually reinforcing and interconnected outcomes that aim to address underlying root causes of energy poverty in Nigeria, namely:

1) a dysfunctional policy and regulatory environment resulting in low levels of investment in the electricity sector; 2) low levels of transmission capacity and unavailability of on-grid generation supply; 3) challenges in scaling the off-grid sector; and 4) liquidity issues in the electricity sector and poor performance of the distribution companies (DISCOs).

In delivering on all the outcomes, the contractor will provide technical assistance, transaction advisory services and other support to key stakeholders in the electricity sector, based on robust and mutually accountable partnerships with a particular focus on three key groups:

● Policy making and regulatory agencies which establish the crucial enabling environment for the Nigerian power sector;

● Distribution companies, which are ultimately responsible for ensuring that improvements in the electricity sector translate to improved flows of reliable, affordable and clean power to the vast majority of Nigerian households and businesses not served by nascent off-grid markets; and

● Private sector with investment interest in the various segments of the electricity sector value chain.

In all interventions in response to the four challenges outlined above, the contractor will leverage its expert insight into the electricity sector, its innovative strategies and experience to structure targeted activities, beyond the specific requested activities, in fulfilling the outcome level goals. The contractor will further identify and support initiatives that increase efficiency and catalyze private sector investment in the electricity sector. Collectively, and with adaptive management, the interventions anticipated in each outcome will strengthen the electricity sector and set it on a path to delivering sustainable, affordable and reliable electricity for the Nigerian people.

C.2 BACKGROUND

Over 200 million people live in Nigeria; its population is projected to exceed 350 million people by 2050, at which point it will be the third most populous country in the world. Over 85 million Nigerians have no access to grid power, and the rest suffer from unreliable supply. Nigeria has one of the world's lowest per capita energy consumption rates, at only 144 kilowatt hours (kWh) annually. The Nigerian power sector's challenges are complex and cross-cutting. According to the World Bank, Nigeria has 13.4 GW of on-grid power generation capacity. However, Nigeria has never delivered more than 5 GW to the grid, 40 percent of which is lost to line losses and theft. Sector challenges include limited gas supply to existing power plants, underinvestment in transmission infrastructure, and the insolvency of most of Nigeria's partially privatized electricity distribution companies. Given these challenges, many Nigerian families and businesses depend on expensive, emission-intensive gasoline and diesel backup generators. The World Bank estimates that the power sector’s woes cost Nigeria $26 billion in foregone growth each year (6 percent of GDP).

Between 2001 and 2013, Nigeria’s power sector underwent a series of reforms, transitioning from a single state-owned power company to an unbundled and partially privatized power sector consisting of a mix of public and privately-owned generation companies (GENCOs), a state-owned transmission company, and 11 majority privately owned electricity distribution companies (DISCOs), overseen by the Nigerian Electricity Regulatory Commission (NERC). These reforms were intended to unlock private investment in the power sector to improve generation capacity, extend grid connections and grid reliability, and enable the sector to transition to financial self-reliance, funded entirely by cost-reflective tariffs.

Despite the considerable efforts of public and private sector actors and development partners, including USAID Power Africa, the electricity sector has not delivered on the anticipated growth. In the ten years since the reforms, the grid’s installed generation capacity, peak generation capacity and energy deliveries measured in Megawatt Hours (MWhs) have stagnated. While electricity subsidies declined between 2018 and 2022 following regular rate increases, they soared to record levels in 2023, following the devaluation of the Naira. Nigeria’s distribution companies are largely insolvent, burdened by historic debts, low energy sales, high technical, non-technical and commercial losses and regulated tariffs insufficient to cover costs.

Five discos have been taken over by their lenders.

While not all goals have been achieved, some important progress has been made in the past ten years. With support from development partners, key public sector institutions, including the NERC and the Rural Electrification Agency (REA), made significant improvements in their regulatory capacity. Several DISCOs, particularly the Lagos-based Eko and Ikeja DISCOs, demonstrated substantial improvements in reducing aggregate technical commercial and collection (ATC&C) losses. The sector also attracted substantial development partner resources, including technical assistance from partners such as USAID and the United Kingdom Foreign, Commonwealth and Development Office (FCDO) and project and outcome-based loans from the World Bank and African Development Bank. Spurred by an improving regulatory environment and development partner support, off-grid renewable energy has grown substantially, including both commercial and industrial solar installations and consumer-focused mini-grids and solar home systems.

Between 2018 and 2023, Nigeria added over 2 million off-grid connections and in 2022 became the largest off-grid market in Africa (though the off-grid market remains very small, in terms of customer count and energy production, compared to Nigeria’s grid and fossil fuel-fired on and off-grid generation sectors).

USAID through Power Africa has made important contributions to these efforts as Nigeria’s largest bilateral development partner and established robust relations with key Nigerian government counterparts. Through the Nigeria Power Sector Program, USAID achieved the following results between Fiscal Year 2018 and 2023:

● 4.7 million new and regularized on and off-grid connections

● 1,096 MW of generation projects reaching financial close

● $2.36 billion in public and private investments mobilized

● 4,441 people trained in technical energy fields

● 8 laws, policies, regulations or standards impacted

With the election of President Tinubu in 2023, Nigeria is poised for a new period of transition, which will hopefully translate into improved outcomes for Nigerians, including improvements in access to reliable, affordable and clean on- and off-grid power. Shortly after assuming office, the President eliminated Nigeria’s costly and regressive petrol subsidies and took steps to integrate Nigeria’s exchange rates. While these initiatives have caused significant short-term pain, including a jump in inflation, they are expected to improve Nigeria’s fiscal position and attractiveness to private investment in time. The President also signed into law the Electricity Act 2023, which, among other reforms, allows state governments to enter into- and regulate- power generation, transmission and distribution.

In alignment with the U.N.’s Sustainable Development Goal #7 which says, “by 2030, ensure universal access to affordable, reliable, sustainable and modern energy services,” the U.S. Congress passed the Electrify Africa Act of 2015 (P.L. 114-121) to encourage the efforts of sub-Saharan African countries to develop power solutions that support poverty reduction, promote development outcomes, and drive economic growth. In addition to the Electrify Africa Act, Executive Order 13746 further defined the Power Africa initiative, appointing USAID as the coordinator and the lead agency to facilitate the implementation of Power Africa and associated activities across the United States government. The Power Africa initiative brings together the collective resources of 12 U.S. government agencies, 21 development partners, key African institutions and counterparts, and over 180 private sector partners to advance sub-Saharan Africa’s development through universal access to clean energy by 2030. To help meet this goal, Power Africa is working with partners and stakeholders to reach 30,000 megawatts of cleaner and more reliable electricity generation capacity and 60 million new household and business connections. To date, Power Africa has supported over 14,000 megawatts of new power projects and over 39 million household and business connections.

Power Africa operates via a partnership model with USAID serving as the coordinator. Effective coordination among Power Africa’s partners is key to the initiative's success. To manage coordination among Power Africa’s U.S. government, donor, and private-sector partners, the Power Africa Coordinator’s Office has two headquarters - one in Washington, D.C. and one in Pretoria, South Africa. In addition, Power Africa staff are embedded in USAID Missions across sub-Saharan Africa. The Coordinator’s Office is composed of four offices, namely Energy, Partnerships, Program and the Front Office (which includes the Communications Team). The Energy Office primarily provides energy sector technical expertise and award management, while the Partnerships Office supports partner recruitment, relations, transaction advancement, and formal partner agreements.

The Power Africa partnership model accumulates results by two methods, through direct award implementation and through partners’ results, which are outlined and acquired in formal partner agreements such as Memorandums of Understanding (MOU) or Letters of Intent (LOI) managed by the Partnerships Office. Each formal partnership agreement includes USAID pledges, made possible largely through direct award implementation such as this award. Recent evaluations have indicated room for enhancing implementation, communication, and coordination outlined in our formal partner agreements and across the entirety of the Power Africa network, indicating coordination with Power Africa’s Partnerships Office is critical to help boost results.

C.3 OBJECTIVE

The Empower Nigeria contract interventions will be delivered through targeted advisory services, technical assistance, capacity strengthening, catalytic grants, pilot activities, and investment mobilization to a range of institutions participating in the electricity sector and in the off-grid sector. These institutions include government ministries, generation, transmission and distribution companies, regulators, private sector stakeholders, trade groups and associations, investors, multilateral organizations and their initiatives, academic institutions and/or civil society organizations among others. Together, the following objectives will be achieved through the Empower Nigeria contract:

1. Improve the delivery and sustainability of electricity services in Nigeria (Reduce energy poverty): by scaling the reliability, capacity and scale of Nigeria’s grid from generation to distribution, and continued growth of off-grid renewable energy in areas not served by the national grid;

2. Accelerate Nigeria’s progress towards a carbon free future: by supporting Nigeria’s transition from fossil-fuel generation to less carbon-intensive grid power and renewable energy off-grid solutions;

and

3. Bolster private sector investment and innovation in the energy sector: by improving the quality, predictability and enforceability of Nigeria’s policy and regulatory environment, as well as through developing partnerships and directly supporting private firms, investors and development finance institutions.

Through these objectives, the Empower Nigeria program will expand supply of and access to affordable, reliable, sustainable and clean grid-connected and off-grid electricity services in Nigeria, with the ultimate goal of advancing development priorities, including inclusive economic growth, competitiveness, security, and improved health and education outcomes.

This contract will connect more Nigerian homes, businesses, and institutions to electricity; reduce greenhouse gas emissions from the energy sector and work in partnership with the Power Africa Coordinator’s Office, USAID Mission, relevant U.S. Government (USG) entities, and other USAID programs in Nigeria, the Nigerian government and its agencies, the private sector, development partners and civil society organizations to improve the enabling environment for electricity sector investment, energy trade, and innovations in the electricity sector.

This contract does not include work in any other West African countries. The contractor should, however, coordinate efforts with the USAID activities delivering services under Power Africa’s Empower West Africa contract and the Strengthening Local Capacity - West Africa activity, which focus on other countries in West Africa, to the extent where their activities interface, such as work with regional bodies like the West African Power Pool (WAPP), the Economic Community of West African States (ECOWAS) Regional Electricity Regulatory Authority (ERERA), and the ECOWAS Center for Renewable Energy and Energy Efficiency (ECREEE). Infrequently, the Contracting Officer (“CO”) may require the contractor to conduct work that affects these regional bodies when such work is required to advance regional issues and interests. Besides this possible, but limited, work with regional organizations in West Africa, the Empower Nigeria contractor must coordinate with all relevant USAID programs and mechanisms that are active within Nigeria, including the Empower Nigeria local award, currently in design, and the Health Electrification and Telecommunications Alliance.

C.4 THEORY OF CHANGE

If the Empower Nigeria program’s activities are successful, technical and non-technical electricity losses will decrease, the volume of energy (MWh) delivered through the national grid will increase, and improving cash flows and profits in the electricity sector will mobilize growing private investment in the Nigerian electricity distribution and generation sector. These advancements will be coupled with a significant expansion in access to distributed renewable energy, particularly in areas beyond the national grid. The improvement in the reliability and delivery capacity of the national grid, as well as rapid expansion in off-grid renewable power in underserved areas, will lead to declining reliance on Nigeria’s massive diesel and gasoline-fueled generator fleet, the most prevalent, expensive and polluting source of power currently in Nigeria. As a result, more Nigerians will benefit from expanded and more reliable access to electricity, spurring greater economic activity while reducing costs and greenhouse gas emissions from fossil fuel self-generation.

C.5 OUTCOMES AND RESULTS

Contract Structure

Funding under this contract is structured under two Contract Line Items (CLINs). CLIN 0001 supports Outcomes 1-3. CLIN 0002, which consists of a minimum of 40 percent of the Total Estimated Cost (TEC), will exclusively support Outcome 4, which focuses on supporting the DISCOs. The GUC facility can be split across CLIN 0001 and CLIN 0002. Project management costs should be allocated to the relevant CLIN or split proportionally where they are not attributable.

C.5.1 Outcome 1 – Enabling Environment Enhanced for Sector-wide Impact and Improved Investment Opportunities

Nigeria’s weak power sector enabling environment, characterized by poor policy design and implementation, capacity gaps in policy and regulatory organizations, uneven and politicized enforcement of existing rules, and a lack of focus on inclusive customer needs particularly for women is widely viewed by Nigerian and international stakeholders as a central challenge to a sustainable, private sector-led electricity sector equipped to meet the energy needs of Nigerian households, businesses and civil society. The contractor should work with relevant stakeholders to support strong Nigerian leadership to enhance the enabling environment to achieve results on all outcomes in the Empower Nigeria contract. Policy and enabling environment interventions must be closely coordinated with other outcomes to address the binding constraints the contractor identifies blocking the deployment of private capital across the electricity sector.

Under this outcome, the contractor must establish results-oriented and mutually accountable partnerships with partner Federal Government of Nigeria government agencies, including but not limited to the Ministry of Power and its agencies particularly the Nigerian Electricity Regulatory Commission (NERC), the Transmission Company of Nigeria (TCN), the Rural Electrification Agency (REA), and the Nigerian Bulk Electricity Trading PLC (NBET). The contractor should be opportunistic and provide support to these entities in the development of new transaction opportunities based on Nigeria’s power sector development plans, including the tenders they issue to attract local and international investment in generation, transmission, and distribution.

Given the growing role of state governments in Nigeria’s electricity sector, the contractor must also establish partnerships with the Nigerian Governors Forum (NGF) and may consider partnerships with key state governments post award. The contractor’s efforts should align with, and/or contribute to the improvement of existing Nigerian government strategies and policies, including the Integrated National Electricity Policy and Strategic Implemen-tation Plan required under the Electricity Act 2023 and currently under development.

The contractor could also interact with other Nigerian Ministries, Departments and Agencies (MDAs), including but not limited to the Bureau of Public Enterprises (BPE), the Ministry of Finance and the Ministry of Water Resources.

To ensure mutual accountability, public sector partnerships must be formalized in Memoranda of Understanding (MOUs) that clearly state the MDA’s topline goals and policy commitments, the contractor’s intended lines of effort, and establish mutual reporting requirements. MOUs will be developed by the contractor and jointly signed by the implementing partner, the MDA partner and USAID. The COR can approve changes to the MOU process and content.

Minimum results

● $[number to be proposed by the offeror] billion of investment mobilized for the electricity sector as a result of USG assistance (for clean energy projects, the definition of this indicator is consistent with USAID standard indicator EG 12-4; for non-clean energy project, this indicator will be custom defined for the Empower Nigeria activity).

● (Number to be proposed by the offeror) of national and/or sub-national laws, policies, regulations, or standards to enhance energy sector governance formally proposed, adopted, or implemented with the support of USG assistance (consistent with Power Africa indicator 3.2.4)

● (Number to be proposed by the offeror) of host-government power sector strategic planning documents adopted, revised and/or implemented with U.S. Government (USG) support (consistent with Power Africa indicator 2.2.1)

● (Number to be proposed by the offeror) of competitive procurements for new generation capacity implemented with USG Power Africa assistance (consistent with Power Africa indicator 2.1.3)

Intervention 1.1: Support to the Nigeria Electricity Regulatory Commission

The Nigeria Electricity Regulatory Commission (NERC) regulates the entire value chain of the electricity sector except for the gas supply, hence, nearly all activities in this contract can be impacted by the regulatory direction of NERC.

The contractor must advance strategies and implement interventions with NERC to enhance the quality of regulatory decisions to all aspects of the electricity sector. The approach must include, but is not limited to:

● Providing extensive technical assistance and insight into the industry key metrics and improving NERC’s market direction instructions.

Intervention 1.2: Support to relevant government institutions to strengthening governance and advance strategic policy initiatives

There are several stakeholders interested in advancing the electricity sector with different activities and program initiatives. The objective of this intervention is to enhance sector governance and advance strategic government policy initiatives either at the Federal or State level. Besides providing coordination support as outlined in other interventions for specific outcomes, the contractor must provide targeted support to cross cutting initiatives that enhances investment in the electricity sector.

The contractor must advance strategies and implement interventions that enhance strategic policy initiatives. The approach must include, but is not limited to:

● Providing support to the Ministry of Power to advance strategic policy initiatives.

● Assessing other government agencies, institutions, and ministries to identify policy, and other enabling environment gaps, opportunities, programs, activities and structure Empower Nigeria contract support with high sector impact both in the short and long term.

● Identifying the electricity sector enabling environment bottlenecks that are cross-cutting and provide the necessary assistance to resolve them.

Intervention 1.3: Support the implementation of the Electricity Act 2023 or other modifications of the Act

The Electricity Act 2023 was enacted to consolidate the laws relating to the electricity sector, provide a comprehensive legal and institutional framework for the power sector in Nigeria in the areas of electricity generation, system operation, distribution, supply, trading, enforcement of consumer rights and obligations.

Furthermore, the Act provides support for a holistic integrated resource plan and policy that recognizes all sources for the generation, transmission and distribution of electricity, including the integration of renewable energy into Nigeria’s energy mix and attracting investment, and for related matters. The Act allows the State Government to generate, transmit, distribute electricity and have their own independent electricity market. Considering this significant structural change in the electricity sector, support is required to ensure that the Act translates into positive impacts for the electricity sector.

The contractor must advance strategies and implement interventions that support the operationalization of the Electricity Act 2023. The approach could include, but is not limited to:

● Supporting a coordinated resource pool/central advisory facility across stakeholders for state governments for operationalizing this Act in their state.

● Providing technical assistance and transaction advisory services as appropriate to enable State Governments to implement the Act with a positive impact on the electricity sector.

● Providing technical assistance to relevant entities to undertake procurement reforms aligned with the Act and in accordance with international best practices.

Intervention 1.4: Promote Gender equity and other marginalized communities in the electricity sector

In its Gender Analysis (see document referenced in RFP Section J) Power Africa identifies gender equity gaps that constrain inclusive development of the power sector in Nigeria. Addressing these concerns requires a holistic, ecosystems approach that incorporates gender equality as a core principle to most activities in the Empower Nigeria contract. While the contractor will address gender equity and inclusion issues as appropriate under the four outcomes, this intervention is purposely set out as a programmatic focus of Power Africa in Nigeria to promote inclusive development of the power sector. So far, the Power Africa program in Nigeria has advanced support for gender equity related activities in the electricity sector including the Energy Sector Women Leadership Initiatives, Growing Green Jobs for Women, Gender lens investing among others. Much more needs to be done on closing the gender equity gaps and elevating the representation of marginalized communities with activities that focus on root causes of sector inequities, including, but not limited to, power dynamics, cultural and social norms, unconscious biases and perception of appropriate roles.

The contractor must advance strategies and implement interventions that enhance gender equality and inclusivity in the electricity sector. The approach could include, but is not limited to:

● Identifying barriers, and opportunities for inclusive programming and implement innovative solutions to advance gender equity and the inclusion of other marginalized communities in the electricity sector.

● Engaging and seeking the participation of groups and communities currently underserved by the sector, and under-represented in the sector’s leadership and workforce to increase diversity, equity, inclusivity and innovation in the planning, development and management of the power sector in Nigeria.

C.5.2. Outcome 2 – Power Supply is Expanded with Increased Operational Capacity, Reliability and System-wide Integration

Power supply in the Empower Nigeria contract encapsulates on-grid generation and transmission systems.

Nigeria’s on-grid generation is dependent on large hydropower and natural gas simple cycle and combined cycle generation. While generation investments continue, some of the country’s large gas-fired generation capacity remains under-utilized. Electricity generation has lagged behind demand. Moreover, the line length, network spread, and capacity of the transmission infrastructure are also not sufficient to meet both on-grid and supplemental (e.g., diesel genset) demand. While generation is largely privatized, transmission remains government-owned. Financing transmission upgrades or new transmission infrastructure has traditionally been done through budgetary allocation. With limited funds and competing investment priorities, government-funded energy infrastructure experiences delays in project execution. Therefore, the impact of interventions carried out under this outcome will be far reaching in the electricity sector.

The contractor will provide a range of technical assistance and transaction advisory support to public and private entities to facilitate (i) the increased supply of sustainable power, and (ii) enhanced and/or expanded transmission to facilitate such supplies. In this context, ‘sustainable power’ refers to a generation mix that meets demand with an appropriate reserve margin, optimizes costs, and contributes to the improved long-term viability, performance, and reliability of the power sector with enhanced environmental performance compared to legacy technologies.

The minimum results for this Outcome include the following:

● 1,000 Megawatts (MW) from power generation transactions that achieve Financial Close (FC) (consistent with Power Africa MEL plan indicator 2.1.5)

● (Number to be proposed by the offeror) of MW from transactions that have been commissioned (consistent with Power Africa indicator 4.1.5).

● (Number to be proposed by the offeror) of Kilometers (KM) of transmission and distribution power lines that either reached financial close with USG, Development Partner (DP) or private (PSP) support (consistent with Power Africa MEL plan indicator 4.1.1) or which are new, reconstructed, rehabilitated, or upgraded that have been energized, tested, and commissioned/installed with USG, DP, or PSP support (consistent with Power Africa indicator 4.1.2)

● (Number to be proposed by the offeror) of Greenhouse gas (GHG) emissions, estimated in metric tons of carbon dioxide-equivalent (CO2e), reduced, sequestered, or avoided through clean energy as supported by USG assistance (consistent with USAID standard indicator EG 12-6 and Power Africa MEL plan 2.1.1)

● Quarterly peak power dispatch through the transmission grid exceeds 7,000 MW (custom Empower Nigeria indicator)

● (Number to be proposed by the offeror) of on-grid generation metrics improved compared to baseline in accordance with NERC metrics (custom Empower Nigeria indicator)

● (Number to be proposed by the offeror) of grid reliability metrics improved and maintained to NERC standard (custom Empower Nigeria Indicator)

Intervention 2.1: Improve installed generation plants availability, reliability and operational capacity

Commonly used energy sources in the generation sector have been affected by several supply bottlenecks resulting in non-availability or sub-optimal operation of the installed generation plants. The contractor should coordinate stakeholder efforts towards understanding the political, commercial, technical and regulatory issues affecting the availability and quality of traditional energy sources to the power sector and guide stakeholders towards practical solutions that improve the reliability of supply from these sources.

The contractor must advance strategies and implement interventions that improve on-grid generation metrics. The approach must include, but is not limited to:

● Providing technical assistance and advisory services to identify and support activities geared towards removing supply bottlenecks (in terms of quantity, quality, and availability) that impair the majority of generation facilities from delivering reliable electricity supply to the grid.

Intervention 2.2: Improve transmission infrastructure availability, reliability and operational capacity

The state of transmission infrastructure in Nigeria is still far behind what is needed for a well-coordinated, efficient and synchronized power sector. The lack of proper planning and synchronization of transmission with other segments of the value chain have resulted in underutilized generation capacity, misalignment of transmission and distribution capacities at interface points leading to stranded infrastructure.

The contractor must advance strategies and implement interventions that improve grid reliability metrics to acceptable industry standards. The approach must include, but is not limited to:

● Identifying ongoing initiatives by Transmission Company of Nigeria (TCN) and other stakeholders to improve the operational efficiency of the electricity transmission system, and determine a USAID/Power Africa support strategy, entry point and interventions with sector wide impact.

● Supporting TCN to increase the technical operational capacity of the existing infrastructure to evacuate more power, reduce technical losses, accept grid-based renewable energy while still operating within acceptable ranges of the approved grid code.

● Assessing TCN’s internal operating processes and procedures, conduct a benchmarking assessment, and assist TCN to implement more efficient standard operating procedures.

● Assisting TCN and relevant electricity sector member institutions to develop transmission expansion and improvement projects, and support their procurement processes, including but not limited to identifying and supporting private investment in the transmission system.

Intervention 2.3: Support new and existing power supply transactions to advance Nigeria Energy Transition

This intervention entails the full gamut of transaction advisory services and technical assistance (such as but not limited to project valuation, prioritization, and preparation; transaction structuring, and engagement with concessional financers) to the government, international donor and private sector stakeholders required to bring new clean and existing power supply transactions or other decarbonization initiatives to financial close, commercial operations, or to meet conditions precedent to debt drawdown. The contractor may support a mix of public, private and public-private generation projects. When identifying entities that will receive transaction advisory support, the contractor should prioritize working with entities that have an existing Letter of Intent (LOI) or Memorandum of Understanding (MOU) with Power Africa through the Partnerships Office. The immediate interest of this contract is to pursue clean power supply and other services that reduce greenhouse gas emissions from the power sector. However, with COR approval, support can be provided to more traditional generation activities considering the existing energy mix in the power sector.

The contractor must advance strategies and implement interventions that advance power supply transactions. The approach must include, but not be limited to:

● Building upon the Power Africa’s pipeline of clean energy generation and transmission transactions including, but not limited to those currently supported by Power Africa’s Nigeria Power Sector Program and aligned with the Nigerian Energy Transition Plan or similar national clean energy goals/programs.

● Identifying and supporting initiatives for new clean on-grid and embedded generation projects that create opportunities for public and/or private sector investment in such projects.

● Enhancing the investment appetite of the private sector, improving project attractiveness to investors and stakeholders and providing support in sourcing for both public and/or private capital whilst catalyzing already earmarked funds from other agencies to advance transactions.

Intervention 2.4: Capacity building to enhance planning, management and operations of the power supply systems

The contractor must build the capacity of stakeholders, including but not limited to civil society advocacy organizations, to enhance planning, management and operations of both existing and new power supply systems within the electricity sector. Capacity building should include both professional and technical skills development. Capacity building must be developed primarily for each intervention area under this outcome and secondarily based on need and demand by the sector or as identified by the contractor. For each intervention under this outcome, the contractor must assess the human development needs, specify and develop appropriate capacity development activities.

C.5.3 Outcome 3 – Offgrid Clean Generation, Connections and Utilization Increased

Nigeria has seen significant growth in its off-grid sector. It has one of the leading mini-grid sectors on the continent, and the country also has one of the largest markets for solar home systems. However, the off-grid sector also faces significant challenges that limit the sector’s ability to scale. At a macro level, issues include economic challenges such as currency devaluation and fluctuations following the floating of the Naira, as well as larger inflation issues seen throughout the region. At the sector level, challenges include lack of local currency and other types of sustainable financing mechanisms, a glut of projects that are considered too small or not bankable, lack of investor familiarity with the sector, low consumer knowledge/awareness, regulatory inconsistencies or inefficiencies, complex taxation and customs and other policies, etc.