Nigeria’s sovereign wealth fund and Vitol have launched a joint venture to invest in a range of carbon avoidance and removal projects, the fund said on Wednesday.
The Nigerian Sovereign Investment Authority (NSIA) said an initial $50 million had been committed and that both firms were in the process of reaching a final investment decision on the first projects.
The new entity, called CarbonVista, was first considered last July to invest exclusively in projects in Nigeria.
It said the first investment will be in a household energy efficiency program aimed at improving clean cooking and water filtration.
High prices for smokeless liquid petroleum gas (LPG) have forced many Nigerians to add wood and charcoal to their cook stands. Prior to the recent oil price rise in 2021, many people had dropped wood amid a campaign to improve public health.
Approximately one billion people in sub-Saharan Africa rely on wood and charcoal for daily cooking and water purification, a major cause of the nearly 4 million hectares of annual deforestation and degradation across the continent, the NSIA said.
The NSIA said the joint venture will provide rural households with efficient devices that would reduce wood fuel consumption and related greenhouse gas emissions while also saving them money and time. It added that the firm would deploy up to 200,000 devices initially.