5 Key Factors to Drive Implementation of Nigeria’s $410 Billion Energy Transition Plan

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The World Bank, the Global Energy Alliance for People and Planet (GEAPP) and the African Development Bank (AfDB) are just some of the organizations present at Nigeria’s virtual launch of its energy plan. energy transition in August 2022. The event presented a roadmap for Nigeria’s journey to net zero by 2060.

Net Zero Climate defines net zero as a state in which greenhouse gases entering the atmosphere are balanced by the removal of those gases from the atmosphere.

Highlights of the Energy Transition Plan

  • Nigeria’s energy transition plan will need $410 billion to be implemented across the country
  • The World Bank and Sun Africa have pledged $1.5 billion each to support the plan’s implementation
  • The Energy Transition Plan has a roadmap that players must implement each year until 2060
  • The plan contains several important goals such as ending gas flaring, developing climate-smart agriculture, increasing off-grid solar adaptation, reforestation, improving the power grid, adapting energy efficiency, as well as conditional and unconditional emission reductions.

Background to a Net Zero Plan

According to the International Energy Agency’s Africa Energy Outlook 2022, Africa contributes less than 3% to global greenhouse gas (GHG) emissions, while Nigeria emits millions of tonnes of CO2 , or about 0.1% of global GHGs. However, the United Nations Intergovernmental Panel on Climate Change has highlighted the urgent need for climate adaptation in Africa. This is due to the fact that parts of Africa have suffered considerable loss and damage related to loss of biodiversity, floods, water shortages, reduced food production, loss of human life and reduced economic growth.

In September 2022, the Vice President of Nigeria, Professor Yemi Osinbajo, led a delegation to the United States to meet with international bodies and the United States government to seek financial support for the implementation of Nigeria’s energy transition plan. Nigeria. Finance is an important part of building resilient energy systems in Nigeria, as are these other factors;

  • Research and development – Nigeria has proven to be fully aware of the implications of approaching the future with old habits of energy transition. Thus, it is entirely valid for stakeholders to focus on ensuring adequate support for partnerships and collaborations for the transfer of skills and knowledge in the development of energy security systems. Stakeholders should use available funding to also provide support to energy researchers and connect local learning institutions with resources to learn more about creating a sustainable energy future for Nigeria.
  • Regional integration – The African Continental Free Trade Area is a great channel for improving the security of energy supplies between African countries. If Nigeria maximizes the opportunities presented by the AfCFTA and addresses the challenges that negatively impact the development of a sustainable regional energy market, the country will benefit in more ways than one.
  • Local awareness campaigns – The International Energy Agency’s Global Commission on People-Centred Clean Energy Transitions has often stated that people are the main drivers of the energy transition. Nigeria should focus on people, especially those without access to formal education and those who still use traditional biomass to meet their daily needs. The IEA specifies that if populations are not directly involved in a country’s energy transition plan, there will be a massive adaptation of strategies and policies.
  • Individual financial capacity building – Nigerians must be individually prosperous to be able to pay for the energy they consume. If energy policies are implemented and people struggle to meet their basic needs, other challenges will arise. Nigeria has yet to generate enough electricity to meet growing demand due to a number of challenges, one of which is the inability of consumers to pay for the electricity they use. The International Energy Agency says that 600 million people, or 43% of the total population, do not have access to electricity, most of them in sub-Saharan Africa. IEA analysis further shows that extending national grids is the cheapest and least prudent option for almost 45% of people with access to electricity by 2030. But who supports the burden of payments for services, if Nigerians are too poor?
  • Fight against threats to life and property – If Nigeria succeeds in meeting the targets set out in the energy transition plan, every threat to life and property must be addressed by the government. This is because non-state actors are unreliable and could damage key energy infrastructure. Such actions not only impact the lives of consumers of these energy sources, but also pose a threat to future energy investments in the country.

What they say

In implementing the energy transition plan, Nigeria must realize that investment in infrastructure and attention to proper regulation of carbon-intensive behavior will be essential.

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Lawyer and Energy-Climate Analyst, Oghosa Erhahon told Nairametrics that for Nigeria’s energy transition plan to be effective, actions that lead to the penetration of the circular economy, as well as energy transition education, must be top priorities.

“If Nigerians are not properly educated on what energy transition means, how will they make the right decisions or engage in energy efficient behaviors?

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“If, for example, two parents are heading to the same destination, using two separate vehicles only contributes more to carbon emissions,” she says.

Erhahon also said that for the energy transition plan to be effective, the Nigerian government must regulate the use of internal combustion engine (ICE) vehicles and diesel generators. In the UK, for example, there is a checklist for ICE vehicles to ensure technical control and limit the amount of carbon these cars emit.

On the financing side, the government is actively seeking partners to invest in Nigeria’s energy transition plan. But past policies that have yet to be fully implemented could work against these efforts.

As Nigeria welcomes a new government administration in 2023, the litmus test will be what the new government prioritizes, says Jide Pratt, an energy player in Nigeria’s midstream and downstream sectors.

Mr Pratt says Nigeria’s political incoherence could work against him when it comes to seeking financial support from the international community.

“I don’t think the international community would fund our plan because we don’t honor contracts. The Petroleum Industry Act is extremely clear on subsidies, but we have already denied that, knowing that it took 12 years for the bill to become law.

Defining Key Performance Indicators (KPIs) and measuring them could also be problematic, as we have seen the same scenario play out in past policies such as the Gas Master Plan, Vision 2020 and the Gas Decade.

Assessing where the energy transition plan will be in the coming years, Mr. Pratt said that Nigeria’s inability to address glaring problems in a timely manner will not encourage much-needed investment to implement the plan and that in 10 years, we may not have made measurable progress.

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