By: Joseph Ojochegbe
Access to clean, modern energy services is an enormous challenge facing the African continent because energy is fundamental for socioeconomic development and poverty eradication. Today, 60% to 70% of the Nigerian population does not have access to electricity. There is no doubt that the present power crisis afflicting Nigeria will persist unless the government diversifies the energy sources in domestic, commercial, and industrial sectors and adopts new available technologies to reduce energy wastages and to save costs.
In diversifying energy sources that are sustainable, renewable energy (RE) becomes the best option. A lot of attention has recently been focused on RE and energy efficiency (EE) measures, as the only way to address the problem of clean energy provision. The development of RE projects is considered as a huge opportunity from a strategic and financial point of view, as well as from a technological and environmental aspect. In the development of RE projects, the government is a major player in ensuring the success of RE development and deployment.
This is achieved through the establishment of strategic policies, plans and the adoption of proper mechanisms. These have the capacity to alter the price of RE technologies through subsidies, taxes, funds, power production and grid access for RE electricity generators. The Nigerian energy policies and strategies are summarized to give an insight on the status quo of renewable energy policies, and they are presented below.
National Energy Policy (NEP)
Before the Federal Government of Nigeria approved the energy policy in the year 2003, there was no comprehensive energy policy. The established energy policy was called the National Energy Policy (NEP) which was developed by the Energy Commission of Nigeria (ECN). The National Energy Policy (NEP) sets out government policy on the production, supply and consumption of energy reflecting the perspective of its overall needs and options. The main goal of the policy is to create energy security through a robust energy supply mix by diversifying the energy supply and energy carriers based on the principle of “an energy economy in which modern renewable energy increases its share of energy consumed and provides affordable access to energy throughout Nigeria, thus contributing to sustainable development and environmental conservation.”
National Economic Empowerment and Development Strategy (NEEDS)
The National Economic Empowerment and Development Strategy (NEEDS) was developed by the National Planning Commission (NPC) in 2004 and was intended to develop and alleviate poverty in the country. This involves the action of human resources on the natural resources to produce goods necessary to satisfy the economic needs of the community. On infrastructure, NEEDS promotes the privatization of government infrastructure and was one of the key instruments in achieving a revamped service delivery.
Renewable Electricity Policy Guidelines (REPG)
This was developed by the federal Ministry of Power and Steel in December, 2006. The Renewable Electricity Policy Guidelines (REPG) mandated the Nigerian government on the expansion of electricity generation from renewables to at least 5% of the total electricity generated and a minimum of 5 Terawatt hour of electricity generation in the country (REPG, 2006). This policy document presents the Nigerian government’s plans, policies, strategies and objectives for the promotion of renewables in the power sector.
Other policies and strategies include the Renewable Electricity Action Programme (REAP), the Nigerian Biofuel Policy and Incentives (NBPI), the Renewable Energy Master Plan (REMP) and so on. In order to achieve success in the development of renewable energy in Nigeria, some obstacles have to be identified. It is, however, not easy to identify a single factor that can have a long positive impact on the development of renewables. We should then look at the supportive measures that can lead to its full exploit or can hinder its development. The factors in the Nigerian case are summarized in this section to list out the essential components affecting renewable energy development. The factors are classified into; capital investment, fiscal incentives, legislation and regulation, politics, policy and strategy, technology and innovation, and environmental support programs.
Even though renewable energy sources have low operational and maintenance costs, most renewable energy technologies have high up- front capital cost compared to their conventional energy alternatives. Apart from the higher capital costs most renewable energy technologies face the barrier of being perceived as untested technologies. Given these twin barriers to renewable energy technologies, investors face higher risks and uncertainties when making investment decisions.
Legislation and Regulation
Achieving adequate energy supply where renewables play a role necessitates the creation of appropriate policy frameworks of legal, fiscal and regulatory instruments that would attract domestic and international investments. Clear rules, legislation, roles and responsibilities of various stakeholders along every stage of the energy flow from supply to end-use are key elements of the overall policy framework needed to promote renewable energy technologies. Such policy, legal and institutional frameworks are at their beginning stage in Nigeria and have not been given proper attention by the Legislature.
Politics, Policy and Strategies
Strong and long-term political support at the federal, state and local government level is a consistent component in the successful development of renewable energy. The political support includes the proper implementation of policies and strategies, price support mechanisms, and provision of funds for R&D activities, as well as the deployment of renewable energy technologies. Other barriers include little or no attention given to Research and Development in Nigeria, lack of environmental support programmes, low rate of public awareness etc.
There is the need for the Nigerian government to develop the renewable energy industry within the country borders. It is important to harmonize the Nigerian energy sector rather than fragmentize it. Mutual cooperation between government agencies and ministries is the first step in a successful renewable energy development.
The government and policymakers need to explore renewable energy options such as small hydropower plants across the country, especially in the rural areas. If this is done in the rural areas with flowing small rivers, the communities could be transformed into semi-urban centres. Thus, enhancing various economic activities that will improve the socioeconomic well-being of those in the rural areas.
On solar energy awareness, the rate has increased in recent times and the acceptance is expected to increase in the future. Some successful research, such as the implementation of solar PV water pump and electrification, solar cooking stoves, crop drying facilities, etc. have been undertaken in the Sokoto Energy Research Centre and the National Centre for Energy Research and Development under the supervision of the Energy Commission of Nigeria.
On wind development, the government has completed the installation of the 20 MW wind farm in Katsina state. However, the progress of wind development in Nigeria is still relatively low as compared to other developing countries in Africa. Since the northern part of Nigeria have high potential for wind energy and the communities have low access to energy, the government most do more regarding the exploitation of wind energy to meet the needs of the populace.
Biomass have been an important renewable energy source in Nigeria, but its sustainability is still a big issue in Nigeria. The government should continuously use municipal waste, oil palm product, sugar cane and rice husk for the sustainability of biomass energy production. Also the government incorporation with the private sector should establish some biogas plants to help the country’s energy sector through energy production.
On the policy side of renewable energy development, effective policy options that can attract foreign direct investment into the country should be a top priority for the Nigerian government. This will not only aid in the production of energy from renewable energy source, but also create jobs and enhance the transfer of technology and knowledge to the local partners. This should be done with some fiscal incentives to encourage indigenous and foreign investors in the renewable energy industry. Other policy options to enhance renewable energy development in the future include the introduction of a National innovation System with a special focus on renewable energy development, and the development of a renewable portfolio standard to increase electricity generation from renewable energy sources. The Net Metering Policy and Biofuels Obligation Policy that has proved successful in other countries should be adopted in the Nigerian context to see if effectiveness, efficiency and successful integration.
All these present a successful prospect for renewable energy development in Nigeria. It is important to state that Nigeria’s long decades of dependence on conventional energy resources may create a “lock-in” for the transition to renewable energy economy. Also, this transition will be expensive in the short term due to the huge investments in renewable energy investment, and the transfer of technology and knowledge.