Nigeria’s Debt Management Office has announced the issuance of the country’s and Sub-Saharan Africa’s first green bond.

The 10.69 billion NGN ($29.8 million) five-year green bond is due 2022 and has a coupon percent rate of 13.48% per year.

The Federal Government of Nigeria, which is the bond issuer, said that net proceeds will be used solely for green projects included in the 2017 Appropriation Act that are already identified and certified.

The bonds will be offered from Dec. 18 to Dec. 20, 2018. The Nigerian government is offering units of sale of 1,000.00 NGN, which are subject to a minimum subscription of 1,000,000.00 NGN.

The government has not specified to which renewable energy technology the funds will be devoted. The financing of large-scale solar projects currently under development in the country still remains one of the biggest issues that developers have to deal with.

Solar power projects are currently being developed in Nigeria mainly by independent power producers. In July 2016,  the Nigerian Bulk Electricity Trader (NBET) signed power purchase agreements for as much as 975 MW of solar. In Nigeria, solar IPPs usually negotiate and execute a put and call option agreement (PCOA) with the Federal Ministry of Finance after executing a PPA.  The PCOA agreement transfers the payment risk from the state-owned company Nigerian Bulk Electricity Trading Plc (NBET) directly to the ministry. The Put Call Option Agreement (PCOA) is a guarantee mechanism recently adopted by the Nigerian government.