Nigeria: Renewable Energy Opportunities Blossoming

By Lanre Okanlawon

Just like any country, Nigeria in the 21st century faces enormous challenges, and one of its most crucial is power. Nigeria has been confronted with incessant electricity problems ranging from power generation to its transmission and distribution. The main sources of its electricity are gas and hydropower, but for many decades, homes, businesses and industries have faced the huge challenges when accessing electricity.

Nigeria is the seventh most populous country in the world and by the end of 2013 its population will hit 170 million, according to the National Population Commission — but 60 percent of Nigeria’s population have no access to electricity, according to Nigeria’s Infrastructural Concession Regulatory Commission.

In most countries that have experienced similar setbacks, the ultimate solution has not been from a single source of energy, but the culmination of several. As an advocate of renewable energy, it is really great to see governments all over the world including green sources of energy in their mix. These actions have predictably increased their respective Total Electricity Installed Capacity (TEIC). Several projects have been proposed with the aim of increasing the TEIC of the country, which currently stands at about 6,000 MW. Recent proposals include the development of new hydropower plants in Mambilla (3,050 MW) and Zungeru (700 MW) and a 10-MW wind farm in Katsina.

The following are the TEICs of nine countries and their respective estimated populations as at the end of 2010; United States (1,000,000 MW, 315 million), Argentina (32,000 MW, 40 million), Venezuela (23,000 MW, 29 million), Poland (33,000 MW, 38 million), United Kingdom (93,000 MW, 64 million), South Africa (44,000 MW, 51 million), Morocco (6,000 MW, 32 million), Egypt (27,000 MW, 83 million), Libya (6,000 MW, 6 million). A quick glance at these figures compared to Nigeria’s (6,000 MW, 170 million) shows an urgent need for melioration, and one common feature that cuts across most of the above listed countries is the adoption of renewable energy sources.

Renewable energy investors are currently looking for investment opportunities in Nigeria after the country was ranked one of the four top investment destinations and growth areas in the world by a leading global audit, finance and tax advisory firm KPMG in March 2013. Understandably, many private investors are not willing to take part in this paradigm, which is being championed by their counterparts in developed countries. There is a measurable amount of risk due to political and economic uncertainties in the nation just like in other parts of Africa.

It is at this juncture that the government should step in and promote this revolution by creating and enabling a sound investment environment and favourable policies to guarantee financial rewards like tax exemptions and renewable energy credits. The benefits of generating more electricity from solar, wind, hydropower and biomass in Nigeria are numerous. The most apparent are the creation of millions of jobs, increased incomes, economic growth and (of course) more stable power supply.