Prime Woman Hangout 2

Energy deficit: Why renewables are key to Nigeria’s economic wellbeing

Charles Kingsley
5 Min Read

Share

Under a big, rusty awning outside his home in Apo, Ekene, 23, lay naked on a raffia mat, save for boxer shorts. A technical fault “affecting the 33 kV feeder from Apo Transmission Substation” had caused a prolonged outage in Apo and its environs, the city’s distribution company said in a public notice. 

“Imagine no light for 3 days. What can be worse than a combo of heat and darkness? ” he lamented. Beads of sweat dribbled from his forehead. 

Ekene’s anxieties reflect a general outcry about Nigeria’s patchy electricity in recent times. This has become more acute following the recent heat waves sweeping through the country. 

Nigeria’s power deficit is not unusual, though. Ask the man in the street to give the meaning of NEPA, and he’ll invariably reply: Never Expect Power Always. If power supply was poor while managed by the state-controlled board, it hasn’t fared any better under its private owners. The national grid collapsed a dozen times in 2023. In February alone, the grid collapsed at least twice. These challenges have been attributed to derelict transmission infrastructure and limited gas supplies. 

At least 92 million people, representing about 46% of the population, still lack access to electricity, according to the Energy Progress Report in 2021. The grid-supplied electricity is so grossly inefficient that Nigerians grapple with frequent power cuts spanning 4 to 15 hours daily. Amid these imbroglios, electricity tariffs have doubled. Recently, the country’s Minister of Power announced that the government would discontinue subsidy for electricity. Consequently, many households and businesses resort to fuel-powered generators for power, with their attendant consequences.

In a joint report released in 2022, Sterling Bank and Stears Data made the case for a transition to renewable sources of energy as a viable solution to Nigeria’s protracted power troubles. According to the report, Nigeria’s energy output of 12,522 MW still falls short of the country’s estimated demand of 8,000 MW, making Nigeria one of the most underpowered countries in the world. 

Today, nearly half of the country’s energy demand is served by small-scale diesel and petrol generators. For MSMEs, which contribute 49.8% of the country’s GDP, this comes at no mean cost. The Rural Electrification Agency estimates that Nigerians and their businesses spend 14 billion dollars on self-generation–namely fuel-powered generators. All of these provoke the need to supplement grid power with off-grid renewable solutions. 

Byencit Duncan, a project coordinator at PAM Africa, reckons that renewable energy can address Nigeria’s energy deficit by increasing energy access to underserved areas while minimizing environmental pollution. Between 2008 and 2014, at least 10,000 Nigerians died from generator fumes. Although Nigeria remains a low emitter globally, the country stands as the third-largest emitter of greenhouse gases in Africa, according to the London School of Economics. 

As in its huge crude reserves, Nigeria boasts abundant renewable energy sources, such as sun, hydropower and wind, to match its soaring energy demands. According to the Nigerian Meteorological Agency, the country experiences at least 6 hours of sunshine daily on average. 

In 2006, the Nigerian government initiated the Renewable Energy Master Plan to boost the supply of renewable electricity in the country from 13 per cent in 2015 to 23 per cent by 2025. As of 2022, though, renewable energy accounted for only 16% of Nigeria’s total electricity capacity.

Enhancing rural electrification using mini-grids and off-grid alternatives can save Nigerian companies and households 4.4 billion dollars every year, the REA states. Yet expanding access to renewable energy involve “key actions such as implementing supportive policies and regulations, investing in infrastructure, building local capacity and raising public awareness about the benefits of energy efficiency,” Duncan says.

 

Renewable power systems remain out of reach for average Nigerians like Ekene, due, in part, to high cost of installation. This, of course, hinders the widespread adoption of renewable energy. By reducing the costs associated with renewable energy products, the government can give consumers increased access to these products. 

By the same token, providing incentives such as grants, tax breaks, and concessional financing for operators in the renewable energy sector will significantly lower the cost of production and usher in a slew of new entrants to allow for more competition. These new companies will be encouraged to service customers in far-flung communities. 

Ekene, a 23-year-old resident of Apo, struggles with a prolonged power outage caused by a technical fault. He reflects a broader dissatisfaction with Nigeria's unreliable electricity supply, which has been exacerbated by recent heat waves. Despite privatization, Nigeria's power grid remains inefficient, experiencing multiple collapses in 2023 alone, and still leaves 92 million people without access. High electricity tariffs and discontinued subsidies have forced many to rely on costly, fuel-powered generators.

Reports advocate a shift to renewable energy to address these issues, noting Nigeria's vast, underutilized renewable resources like solar and hydropower. The Renewable Energy Master Plan aims to increase the renewable energy share to 23% by 2025, yet, by 2022, it was only at 16%. Renewable solutions could save Nigerians approximately $4.4 billion annually but face high installation costs that deter widespread adoption. Introducing supportive policies, infrastructure investment, and financial incentives could lower costs and encourage competition, making renewable energy more accessible and reducing environmental pollution.

Share this article

Facebook
Twitter
WhatsApp
Leave a comment