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Solar energy

Catalysing solar energy in Nigeria

4. December 2023

Solution provider

Investment Fund for Developing Countries – IFU

IFU is the Danish Development Finance Institution providing risk capital for private sector investments in developing countries and emerging markets. Investments are made on commercial terms in the form of equity, loans and guarantees. The purpose is to support the green transition and create just and inclusive societies.

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In Nigeria, the national electricity grid only provides around 20 percent of the power. A significant portion of power is produced using more than five million diesel generators. These diesel generators make a significant contribution to the CO2 emissions and overall air pollution, and the total cost for fuel and maintenance is around EUR 13 billion (USD 14 billion) annually.


Through the Danish SDG Investment Fund, IFU has led a consortium of private and public investors who have collectively invested EUR 36 million (USD 38 million) in the Nigerian company Daystar. The company delivers turnkey solar energy solutions to businesses and factories, enabling a more reliable electricity supply while reducing costs and CO2 emissions.


Among other things, the purpose of the investment was to provide working capital to Daystar to develop its organisation and increase the installation of solar energy systems. The investment was a success, partly because of IFU’s active ownership. It has helped create an attractive, locally-rooted company to help drive Nigeria’s green transition and generate green jobs and growth. Daystar has since been sold to Shell. Shell brings fresh capital to Daystar for the company to grow and Daystar will contribute to Shell’s transition away from fossil fuels.


IFU, Ministry of Foreign Affairs of Denmark, Daystar

Financing the green transition

This is a part of the white paper “Financing the Green Transition”. Discover Denmark’s plans to mobilise investments to accelerate the transition to a carbon-neutral and climate-resilient economy.

Explore the white paper