Published on December 29th, 2021
Nigeria’s vast potentials for renewable electricity generation
Hydroelectric energy remains the largest source of renewable energy for commercial electricity capacity in Nigeria. However, despite its abundance in renewable power resources, a significant part of Nigeria’s electric power capacity is generated from fossils. Nigeria has the ninth largest gas reserves and is one of the largest exporters of crude oil globally. Only recently, the country has made strides towards integrating renewable energy into its energy mix.
The Nigerian power sector has gone through a transition from being publicly owned and controlled to a decentralised private sector-driven one. Priorly, the Nigerian Government had launched the “Sustainable Energy for All” (SE4ALL) Action Plan in 2012. The SE4ALL Action Agenda is simultaneously a national implementation tool for reaching the Sustainable Development Goal (SDG) on energy (SDG 7) and lays out Nigeria’s Strategic Vision 30:30:30. The objectives of the SE4ALL Agenda are aligned with the goals of the National Energy Agenda, which gives high priority to providing access to safe, reliable and affordable energy to citizens in both urban and rural areas. SE4ALL encompasses three main areas that have to be seen interdependent:
- Access to Electricity
SE4ALL targets 90% of Nigerians (both in urban and rural areas) having access to electricity by 2030.
- Energy efficiency / Climate Emission Targets
Adopting the Paris Agreement on climate change, Nigeria committed to reduce its carbon emissions from the power and economic sectors by 2030. Under its most ambitious target, emissions in the power sector would be kept below 300 MtCO2e (million tons of carbon dioxide equivalent) by 2030.
- Renewable Energies
SE4ALL and the Renewable Energy and Energy Efficiency Policy plan (REEEP) state that Nigeria intends to generate about 9,000 MW of on-grid power from renewable energy sources (incl. hydropower dams) by 2030. This would constitute about 30% of the energy mix.
In November 2021, Nigeria introduced the Climate Change Act to ensure the country meets its target to reach net zero emissions by 2060. The Act introduces a Climate Change Fund for the implementation of strategies for low carbon emissions. The Act was signed into law by the President following the High-Level dialogue in Glasgow in the Conference of Parties on Climate Change (COP 26), where Nigeria raised its National Determined Contributions (NDC) under the Paris Agreement and declared its national target to reach Net Zero by 2060.
As one of the major oil producers globally, Nigeria heavily relies on the export of crude oil, which significantly contributes to its national income. The Nigerian Economic Sustainability Plan that was published recently, focuses on non-oil exports. The Zero-Oil Plan actively promoted by the Nigerian Export Promotion Council (NEPC), sets Nigeria on the right path to economic diversification by, introducing alternative exports under the Export Expansion Facility Programme. This presents an opportunity for Nigeria’s economy to focus on an increasing capacity for renewable energy while committing to reducing carbon emissions nationally.
For a nation rich in renewable energy and capacity to diversify national income like Nigeria, investing in renewable power, Power-to-X could provide a viable route to economic development.
Between November 8 and 11, the International PtX Hub engaged Nigerian stakeholders in a two-day training and an interactive, country specific transfer workshop on the third day. The training was jointly organised with the Global Hydrogen Diplomacy Office (German-Nigeria Hydrogen Office), H2 Diplo, in Nigeria which is implemented by GIZ and founded by the German Ministry of Foreign Affairs is to support a partnership on Green hydrogen and PtX exports between Germany and Nigeria and will be the focal point for questions evolving around PtX endeavours.
The session led by experts from the PtX Hub and moderated by local H2Diplo staff helped participants from ministries, industry and academia to identify how Nigeria can utilise existing infrastructure and gain maximum benefit from its resources while moving towards hydrogen economy based on a strong PtX value chain and infrastructure.
Presentations that formed part of the basis for the third day’s strategic discussions and group works were held by: Siemens Energy Nigeria, AHK, Ministry of Power and Jülich Research Institute. The afternoon session allowed all participants to reflect on the knowledge shared, identify key stakeholders and responsibilities and an opportunity to raise scenarios on hydrogen prospects in Nigeria.
Nigeria has no detailed plans to produce PtX fuels or chemicals yet. However, the National Energy Policy 2018 already mentions hydrogen pathways to incorporate hydrogen into the energy mix.
With the growing demand for decarbonised processes and products, the demand for renewable energies grows, too. Nigeria could vastly benefit from this growing demand by building up its renewables infrastructure and providing for the great need. An important step towards determining which sectors will be the most promising in the short-, medium- and long-term for PtX application, starting from the sourcing of renewable energies all the way up to creating a strong supply network for PtX products such as hydrogen and ammonia on a national, regional and potentially international level, is to carry out cost abatement analyses across clusters and industries as well as feasibility assessments.
Next Steps for Nigeria
The recently set up Hydrogen Office in Abuja will expand the activities of the German-Nigerian energy partnership, which has been in place since 2008. Its objective is to network decision-makers, experts and companies from both countries and to offer expert advice on the opportunities and challenges posed by the hydrogen economy. The project is being implemented in cooperation with the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH.
The PtX Training participants have looked at the impact that a decrease in global demand for fossil fuels would have on Nigeria’s economy. The current and future challenge will be in identifying alternative sources of energy and markets that Nigeria has the capacity to trade in. Taking first steps into the direction of a PtX economy can provide Nigeria with an opportunity to become a key player, especially in producing PtX products.
However, a major bottleneck might be the speed and availability to provide the adequate infrastructure and financing for PtX infrastructures. The country could investigate tapping into the proposed Africa natural gas network that includes the flow for hydrogen gas as well.
The PtX Hub and H2Diplo benefitted of the momentum of the training to urge participants and stakeholders to invest in carrying out assessments on abatement costs, feasibility and environmental impact and risk mitigation in the coming months. To provide a secure environment for investment and confidence for investors, a coherent regulatory framework has to be put in place.
Elisabeth Kriegsmann contributed to this article.
