renewable energy in nigeria: a peep into...
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For Citation: Onifade, T.T.2015. Renewable Energy in Nigeria: A Peep into Science, A Conclusion on Policy. IJISBT, 1, 49-
72. Available at: http://wwhsdc.org/ijisbt/articles/
RENEWABLE ENERGY IN NIGERIA: A PEEP INTO SCIENCE, A CONCLUSION ON
POLICY
Temitope Tunbi Onifade
Lecturer, Sustainable Resource Management, Division of Social Sciences, Grenfell Campus, Memorial
University of Newfoundland, Canada.
[email protected]; [email protected]
Abstract
Many scholars and other stakeholders trace environmental problems facing many oil-rich jurisdictions
to the current fossil fuel energy regime that oil-dependent economies rely on. In a quest for ways to
reduce environmental problems, an examination of the situation and prospects of renewable energy as a
complement, and where possible an alternative, to fossil fuel in an oil-dependent jurisdiction such as
Nigeria is necessary. The literature on renewable energy and related topics has not sufficiently
answered questions on why renewable energy has failed to thrive despite the interests governments have
shown in it. Nigeria’s renewable energy sector can succeed only if stakeholders develop jurisdiction-
specific policy frameworks addressing current renewable energy challenges. A peep into the scientific
literature on renewable energy reveals facts and figures specific to different geographical zones in
Nigeria, informing the right course of action for renewable energy policy and business in the country.
Nigeria has commercially exploited hydropower and commenced exploiting solar energy, but has not
exploited wind energy, bioenergy, and geothermal energy considerably despite their prospects across
the geographical zones of the country. Nigeria should fill this gap by developing suitable jurisdiction-
specific policy instruments and institutional frameworks.
Keywords: renewable energy; policy instruments; regulatory institutions; Nigeria
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1. Introduction
Nigeria is blessed with resources that it can exploit for developing Renewable Energy (RE). The
major RE resources that the country has tapped are hydropower, solar energy, wind energy and
bioenergy. The potentials of some other resources such as geothermal, nuclear energy, waves, tidal
energy, and ocean thermal gradient still remain untapped and unqualified (Nnaji et al. 2010: 35). With
vast land resources, moderate wind power and varying heat degrees across the country, every part of the
country can efficiently and effectively host renewable power with the right regulatory frameworks in
place. This article argues that the success Nigeria can achieve in exploiting its enormous RE resources
depends on its policy framework, and provides policy indications suitable for developing RE in Nigeria.
It answers questions on why the RE industry has not thrived in Nigeria despite the interest the
government has shown in it, and the type of policy instruments and institutions suitable for a RE regime
in the country.
The paper proceeds in five parts. The first part comprising this introduction provides the research
context, question, and thesis. The second part peeps into the science of RE, highlighting its sources and
capacity in Nigeria while revealing clues for developing the sector. The third part justifies the science-
policy interface on RE matters in Nigeria, identifying policy concerns and issues. The fourth part links
the science of RE to its policy, highlighting relevant policy principles and provisions in the Nigerian
regulatory system. The fifth part concludes the paper.
2. Peeping into the Science
Nigeria is endowed with vast RE resources well distributed throughout the country (Akinbami 2001:
155; Idris et al. 2013: 11). The main sources of RE in Nigeria are hydropower, solar energy, wind
energy, bioenergy and geothermal power. The nature and distribution of these resources vary across the
geographical divides of the country, and the country has exploited them at different levels.
A. Hydropower
Hydropower supplies about 40% of the total electric power in Nigeria (Awogbemi & Komolafe
2011: 163). Its primary source is large rivers such as Niger and Benue and their several tributaries and
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natural falls possessing high hydropower potentials for the country. These large rivers constitute the core
of the Nigerian river system and offer a renewable source of energy for large scale hydropower above
100 MW (Idris et al 2013: 12). Several sources of small rivers and streams also exist within the present
split of 11 river basin authorities, some of which maintain minimum discharges all year round (Vincent-
Akpu
2012: 3). Governments and the private sector can harness these sources for small-scale
hydropower projects which Idris et al. (2013: 12) estimate at less than 10 MW.
Research estimates the total technically exploitable large scale hydropower potential of Nigeria
as over 10,000 MW, capable of producing 36,000 GWh of electricity annually, from which only about
one-fifth of this potential had been developed as at 2001 (Idris et al. 2013: 12). Scientists carried out a
study in 12 states and four river basins and identified over 278 unexploited small hydropower (SHP)
sites with total potentials of 734.3 MW (approximately 734 MW) (compare data by Idris et al. 2013; and
Aliyu & Elegba 1990). One should note here however that hydropower sites are not limited to the areas
under those studies as suitable sites exist in virtually all parts of Nigeria with an estimated total capacity
of 3,500 MW (Vincent-Akpu 2012: 3). As at 2012, hydropower accounted for about 29% of the total
electrical power supply (Vincent-Akpu 2012: 3).
The Nigerian Electricity Supply Company (NESCO) and the federal government have installed 8
small hydropower (SHP) stations with an aggregate capacity of 37.0 MW, most of which one would find
around Jos at Kwali and Kurra Falls (Vincent-Akpu 2012: 3). As at 2010, Okafor and Joe-Uzuegbu
(2010:211) estimated the total technically exploitable hydropower potential Nigeria had based on its
river system to be about 11,000 MW, out of which stakeholders were only tapping and developing about
19%. These rivers, waterfalls, and streams with high potentials for hydropower, if properly harnessed,
will lead to a decentralized use of RE resources, and provide the most affordable and accessible option
of off-grid electricity services especially in the rural communities.
Despite its potentials, hydropower faces some problems in Nigeria. Developing and employing
hydropower in Nigeria suffers financial, physical and management disadvantages. Financial
disadvantages appear in form of huge debts, management disadvantages take the form of corruption, and
physical disadvantages show themselves in form of droughts and reduced energy generation as well as
harm to wild life and human ecosystems (Vincent-Akpu 2012: 3). Policy and regulatory systems that
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actors design for hydropower in the country must therefore be ones that do not only increase the
exploitation of hydro resources and production of hydro energy from them but also ones that address
these problems. This will encourage private sector participation while providing good guidelines for
doing business in the sector.
B. Solar Energy
Research shows that Nigeria lies within a high sunshine belt and as a result solar radiation is
fairly well distributed within the country (Idris et al. 2013: 12). Idris et al. (2013: 12) estimate that the
annual average total solar radiation varies from about 12.6 MJ/m per day in the coastal latitude to about
25.2 MJ/m2 per day in the far North. Vincent-Akpu (2012: 3) shows that there is an average solar
radiation of about 19.8 MJm –2 day-1 and average sunshine hours of 6hrs per day. Solar radiation
intensities range from 3.5-7.0 KWhm per day and sunshine duration ranges from 4.0 to 9.0 hours per
day (Idris et al. 2013: 12). Uzoma et al. (2011:1) show that if solar collectors could cover one percent of
Nigeria’s land area, Nigeria would generate 1850 x103 GWh of solar electricity per year. These findings
reveal that Nigeria has huge potentials for solar energy.
Nigeria exploits solar energy resources. Solar collectors or modules are perhaps the RE devices
most Nigerians encounter. Vincent-Akpu (2012: 4) establishes that Nigerians have installed several PV-
water pumping, electrification, and solar-thermal installations at various places in the country; in the
North with extreme heat, the Sokoto Energy Research Center (SERC) and the National Center for
Energy Research and Development (NCERD) under the supervision of the Energy Commission of
Nigeria (ECN) have undertaken several pilot projects, surveys, and studies to power daily domestic and
industrial activities including cooking, crop drying, incubation, and chick brooding with solar energy.
Such projects have also received attention at low and medium investment levels for activities such as
water pumping, village electrification, rural clinic, and schools’ power supply, vaccine refrigeration,
traffic lighting and lighting of road signs (Vincent-Akpu 2012: 4). Solar sources are particularly useful
in agriculture, for both subsistence and commercial practice. Farmers and other stakeholders employ
them for activities such as crop drying, poultry production, chicken brooding, chicken growing, manure
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drying, and swine production (Yohanna & Umogbai 2010). However, the rate at which stakeholders
employ solar energy for these activities vary across the country based on solar distribution and intensity.
Solar energy remains popular in Nigeria. When one takes a stroll around the streets, one sees
street lamps and roofing materials having solar devices; we find them in private houses, moderate to big
companies, and government infrastructures. Every level of government in the country has attempted to
harvest solar energy. Despite the interests stakeholders and business enterprises have shown in this
source of energy, it is yet to experience any significant development. While it is clear that solar energy
development has not been consistent because its resources vary across the country, it is not yet settled
whether there are more financial constraints than policy gaps. It seems safe to conclude that the sector
experiences a combination of both: the current level of technology for exploiting solar energy is not
business-friendly, and there are policy and regulatory gaps. This paper leaves further inquiries into these
findings to future research.
C. Wind Energy
Nigeria has wind energy resources. Vincent-Akpu (2012: 3) reveals that wind is available in
Nigeria at annual average speeds of about 2.0 m/s at the coastal region and 4.0 m/s at the far northern
region. With air density of 1.1 kg/m3, the wind energy intensity perpendicular to the wind direction
ranges between 4.4 W/ m2 at the coastal areas and 35.2 W/ m2 at the far northern region (Sambo 2009:
15). In addition, Nigeria has an annual average wind speed of I0m heights and it varies from 3m/s in the
coastal areas to 7m/s in the far North having less vegetation (Idris et al. 2013:12). As far back as early
1960s, a few number of stand-alone wind power plants were installed in 5 northern states mainly to
power water pumps and a 5 kW wind electricity conversion system for village electrification at Sayyan
Gidan Gada in Sokoto State (Uzoma et al. 2011: 1).
Despite these resources, Nigeria had no commercial wind power plants connected to the national
grid as at 2012 (Vincent-Akpu 2012: 3). In an attempt to revive this source of RE in Nigeria, scientists
have conducted studies to assess the wind speed characteristics and associated wind energy potentials in
different locations in the country, leading to attempts by the Sokoto Energy Research Centre (SERC)
and Abubakar Tafawa Balewa University to develop capability for the production of wind energy
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technologies (Vincent-Akpu 2012: 3). So far however, the country has not developed a commercial and
business-friendly wind energy sector. The reasons for this low rate of development are similar to the
ones for solar energy: expensive technology not appealing to business, and inadequate policy
frameworks.
D. Bioenergy
Bioenergy is energy that one derives from biomass. Vincent-Akpu (2012: 4) reveals that Nigeria
is rich in biomass resources including crops, forage grasses and shrubs, animal wastes and wastes
arising from forestry, agriculture, municipal and industrial activities, and aquatic biomass. Of these,
Nnaji et al. (2010: 35) identify crops such as sweet sorghum, maize, and sugarcane as the most
promising feedstock for bio-fuel production. Vincent-Akpu (2012: 4) sums up the suitability of other
biomass brands for energy production and their advantages as follows:
Plant biomass can be utilized as fuel for small-scale industries. It could also be fermented
by anaerobic bacteria to produce a cheap fuel gas (biogases). Biogas production from
agricultural residues, industrial, and municipal waste does not compete for land, water
and fertilizers with food crops like is the case with bioethanol and biodiesel production
and, will reduce the menaces posed by these wastes. In Nigeria, identified feedstock
substrates for an economically feasible biogas production include water lettuce, water
hyacinth, dung, cassava leaves and processing waste, urban refuse, solid (including
industrial) waste, agricultural residues and sewage.
Vincent-Akpu’s contribution reinstates the fact that one derives biomass from biological organisms.
Biomass’ resources produce bioenergy, and may seek them from domestic and industrial wastes (Audu
& Aluyor 2012). Many biological wastes or byproducts are readily available in both rural and urban
communities in Nigeria, making their acquisition cheaper than other forms of RE resources. This
establishes that bioenergy is viable for rural areas in Nigeria, and rural areas constitute the larger part of
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Nigeria. Exploiters can also enhance bioenergy through recycling and composting schemes, making
further resources available for developing biomass.
Emphasizing the foregoing point, Vincent-Akpu (2012: 4) estimates that Nigeria produces about
227,500 tons of fresh animal waste daily, making it possible for the country to produce about 6.8 million
m3 of biogas every day. He illustrates further that since 1 kg of fresh animal waste produces about 0.03
m3 biogas, then Nigeria can potentially produce about 6.8 million m3 of biogas every day from animal
waste only (Vincent-Akpu 2012: 4). Other biomass resources that Nigeria has exploited include sawdust
and wood wastes. Small particle biomass stoves already exist for burning sawdust and wood shaving
(Vincent-Akpu 2012: 4).
Experience has shown one that researchers and other stakeholders have continued to work on
policy and regulatory aspects of exploiting these resources to produce biogas in Nigeria. For example,
some scientists have done research on reactor designs that would lead to process optimization in the
development of anaerobic digesters (Vincent-Akpu 2012: 4). This further underscores the potentials of
bioenergy in Nigeria, and the effort researchers are making to exploit them. Whether or not the research
provides any level of improvement is beyond the scope of the instant paper.
Despite the potentials of biomass in Nigeria, the country currently limits its investment on this
energy resource to thermal fuel for cooking and crop drying (Vincent-Akpu 2012: 4). There is no
considerable use of biomass for large-scale energy production. Also, some commentators have accused
bioenergy for its potentials of reducing food sources because it employs food stock as its energy
resource (Vincent-Akpu 2012: 4). In many Nigerian communities, food stock that many people may
otherwise regard as remains provides food for many poor people. The food stock that biomass employs
for energy production may also form the bulk of food resources available for domestic animals, and the
production of organic fertilizer for farming; one may secure evidence supporting this line of argument
by visiting local farms around the country. The concerns that this article has expressed concerning
bioenergy resources necessitate regulating how actors sanction the use of food resources for bioenergy.
Regulatory institutions should monitor policies governing both food production and bio-energy
development.
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E. Geothermal Power
Nigeria has not developed geothermal energy but some scholars speculate that there may be
potentials for geo-pressured systems and hydrothermal systems in basins such as Benue through the
Niger Delta (Adegbuyi et al. 1990). A survey of energy sources in the literature and other empirical
evidence however reveal that Nigeria is yet to take this source of energy seriously. The country does not
include it among the energy sources it considered in the Vision 2020 National Technical Working Group
on Energy Sector (see National Technical Working Group on the Energy Sector 2009). Many other
sector-specific and jurisdiction-specific energy conferences have not considered geothermal sources; for
example, the Nigerian Alternative Energy Expos which the Ogun State government has sponsored do
not take geothermal energy seriously. For these reasons, federal, state and local governments should
initiate policies that will enhance research on geothermal potentials in the country. This recommendation
is more important to the Southern part of Nigeria with basins and other specifics peculiar to geothermal
power.
3. Policy Issues and Concerns
While it is not an issue whether or not Nigeria has shown commitment to RE, it remains
unsettled whether the commitment that the country has given to it is sufficient to make it effectively and
efficiently enter the existing energy market. Nigeria has given RE policy commitments, but these
commitments have not encouraged the development of RE resources across the various geographical
regions of the country in the most beneficial and business-friendly manners. The attention the country
has given to RE has not been from jurisdiction-specific and subject-matter specific perspectives:
government policies and regulations have not sufficiently considered the strengths and weaknesses of
specific geographical zones’ RE resources, and the regulations that will suit such resources in the said
jurisdictions. These are issues that the literature needs to discuss more.
Also, despite the fact that Nigeria is well endowed with RE resources that offer sustainable
alternatives to petroleum and has shown commitments to developing them, it has left them largely
untapped (Lagos State Ministry of Energy and Mineral Resources. Jan., 2012). As at 2009, Ajayi (2009:
35) concluded that replacing fossil fuel with RE is the ultimate goal in Nigeria, but stakeholders were
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not realizing the goals because fossil fuel accounted for 80% of global energy demand with the result
that it was not possible for RE to replace it and sustain even a basic standard of living. The author
continued that although the volume of RE was increasing at an enormous rate, it was still being
outstripped by rising energy demands (Ajayi et al. 2009: 35). The lessons Ajayi’s findings present are
important for redefining policy frameworks that will enhance business prospects as well as effectiveness
and efficiency in the RE sector.
Nigeria’s energy sector has relied largely on petroleum and fuel wood, and some input from
hydropower. As at 2008, the energy consumption mix in Nigeria was dominated by fuel wood (50.45%),
petroleum products (41.28%) and hydro-electricity (8%) (Omokaro 2008: 55). Apart from hydro,
Nigeria has neither fully explored nor developed other RE resources such as coal, nuclear, geothermal,
tidal, wind and solar energy forms. While wood constitutes a RE resource, Nigerians have employed it
in a manner that is not environmental-friendly, as fuel wood that produces carbon. This leaves hydro as
the only RE resource that Nigeria has exploited in a fairly ideal manner consistent with environmental-
friendly principles to a reasonable extent. Apart from RE resources that this paper has identified that
Nigerians employ in a manners not friendly to the environment, other sources of RE have either been
neglected, not discovered or at their early stages of development (Ajayi et al. 2009: 35).
Comparing the findings of Ajayi et al. above with the empirical situation in Nigeria reveal some
lessons. Ajayi et al. were correct only to the extent that rising energy demand outstripped RE despite
the latter’s increase. Their assertion that replacing fossil fuel with RE is the ultimate goal in Nigeria is
unfounded, somewhat hasty and lacking sufficient supporting empirical evidence. What this paper posits
is that governments at different levels and the private sector have given RE a considerable level of
attention recently. Notwithstanding the increased level of attention however, current policy frameworks
and instruments do not suggest that stakeholders have prioritized RE.
Unlike countries such as China, India, and Brazil, Nigeria is yet to fully exploit the benefits of
RE. Awogbemi and Komolafe (2011) are of the opinion that Nigeria has not been fully exploited RE
partly due to ignorance and partly due to high cost of the conversion technologies involved. As at 2009,
renewable sources constituted 90% of the energy that the country’s rural population used (Sambo 2009:
15). However, one should note the point this paper has made, that the manner with which many
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Nigerians use RE is not environmental friendly. This is true of Sambo’s figure as well, because many
people in the rural areas depend on RE resources for food, housing, and other daily needs, hence
exploiting them in non-environmental friendly manners.
Concerning RE potentials in Nigeria, scientists commercially researched RE technologies mainly
relating to solar photo voltaic (Solar PV) development and usage as at 2005 (Sambo 2009: 13). The
survey reveals that a total of 33 companies, established within 1999 and 2009 as vendors or contractors
for the supply and/or installation of solar-PV equipment and systems, were active in Solar PV. Local
industries do not manufacture major solar-PV system components such as module controllers, inverters
and solar batteries. Local Nigerian manufactures only produce standard electrical components such as
cables, switchgear, overload protectors and consumers’ units (Sambo 2009: 14).
Hope is not lost as RE continues to develop in Nigeria. As at 2013, the International Renewable
Energy Agency (IRENA) estimated RE projects from both government and private sectors in Nigeria.
IRENA gave the summary as follows: 10 MW of wind capacity addition by 2012 (1 project), 2,930 MW
of hydropower capacity addition announced (3 projects), 80 million litres of biodiesel per year capacity
addition announced (1 project), 225 million litres of ethanol per year capacity addition announced (4
projects), 5 MW of biomass-fired capacity addition announced (1 project), 10 MW of dispersed solar
photovoltaic projects (for water pumping, street lights and mini-grids), 10 MW of wind capacity
addition by 2012 (1 project), 2,930 MW of hydropower capacity addition announced (3 projects), 80
million litres of biodiesel per year capacity addition announced (1 project), 225 million litres of ethanol
per year capacity addition announced (4 projects), 5 MW of biomass-fired capacity addition announced
(1 project), 10 MW of dispersed solar photovoltaic projects (for water pumping, street lights and mini-
grids) and the Kwale Clean Development Mechanism (CDM) project which was registered in Nigeria in
2005 (International Renewable Energy Agency [IRENA] 2013).
Investigations continue on the potentials of RE resources in Nigeria. RE research and
development centers of the ECN organized conferences at some selected Nigerian universities where
participants developed several prototypes of RE products and devices including solar cookers, solar
dryers, solar water heaters, solar stiles, PV applications, biogas digesters and stoves, and wind electricity
converters, most of which were ready for mass production and commercialization (Sambo 2009: 14).
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The ECN produced the RE master plan in 2005, serving as a blue print for developing the RE sector in
Nigeria.
4. Policy Principles and Provisions
Nigeria mainly regulates RE with non-law policy instruments. This is because most of the laws
covering RE issues in Nigeria have other mainstreams. These laws either have RE as a secondary target
or have inadequate scopes to sufficiently cover RE concerns. This research also discovers that there is
no primary government ministry or agency saddled with the exclusive regulation or/and development of
RE in Nigeria. The significance of these points is that RE currently largely receives indirect legal
support, although there are other policy instruments directly addressing its concerns. These are matters
requiring closer attention in the literature.
A. The Nature of RE Policy Instruments
One can largely associate the low rate at which RE develops to the absence of an efficient and
effective regulatory framework. The situation is difficult in Nigeria because the country currently lacks a
specific institution or statute focusing on RE (Sambo 2009: 24). The laws available only indirectly relate
to RE, although other non-law policy instruments directly address RE issues. Due to the absence of
reliable enforcement status such as the one people associate with laws (as against the obligatory status
that other non-law policy instruments have), state actors need to develop compliance frameworks that
will boost RE and its prospects.
Since the United Nations Conference on Environment and Development (UNCED) 1992
otherwise called the Rio conference, Nigeria has taken indirect steps in promoting RE and RE projects,
as the country’s policy and legal frameworks would reveal. Being a statute, the Electric Power Sector
Reform Act 2004 has been the most authoritative policy instrument supporting the development of RE.
Due to a dearth in statutes giving sufficient support to RE, policy statements and plans have become
popular instruments that the country employs for supporting RE development. So far, the FGN has
produced them as both environmental policy instruments, indirectly, and direct RE policy instruments.
These policy instruments include the Nigerian National Policy on the Environment 1999, National
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Electric Power Policy 2001, National Energy Policy 2003, Renewable Energy Master Plan 2005, RE
Policy Guidelines 2006, Biofuel Policy and incentives 2007, Nigerian Millennium Development Goals
(MDG) 2000, the National Economic Empowerment and Development Strategy (NEEDS) 2003-2007,
and the IRENA statute ratified in 2010. While most RE policy objectives and principles have become
obvious mainly in the country’s electricity industry, not until the 2005 Master Plan and the 2006 policy
guidelines did RE become a substantial part of the national power planning process. Nigeria is currently
developing a comprehensive Rural Electrification Policy and Strategies that meet international standards
and best practices ( Efurumibe et al. 2014:74).
The most insightful statute giving indirect support to RE is the Electric Power Sector Reform
Act(EPSR) 2005. The National Electric Power Policy (NEPP) 2001 is the precursor to the EPSR Act
2005. The EPSR contains most of the earlier provisions of NEPP. The Act liberalized the electricity
sector and the duo of the Nigerian Electricity Regulatory Commission and the Rural Electrification
Agency. The Act emphasizes the role of renewable electricity in the overall energy mix, especially for
expanding access to rural and remote areas. In Part IX under Rural Electrification, Section 88 (9)
stipulates that information shall be presented to the President by the Minister of Power and Steel on,
among others: (a) expansion of the main grid, (b) development of isolated and mini-grid systems, and (c)
RE power generation. The EPSR has created business opportunities in the RE sector, and has presented
a framework that gives grid access to not only large scale RE production but also small to medium scale
RE producers especially in rural areas. However, the Act lacks sufficient concession schemes which
would encourage investment in RE; it does not provide special and exceptional fiscal and regulatory
support incentives for RE, making it difficult for investors to shift to RE in view of competitions with
other energy sources in the market.
The Nigeria National Policy on the Environment 1999 is the most comprehensive environmental
protection document lending support to RE. It provides that the goal of the policy on the environment is
to achieve SD in Nigeria, and in particular to: secure a quality of environment adequate for good health
and wellbeing and to conserve and use the environment and natural resources for the benefit of present
and future generations (Ladan 2009: 24). Ladan (2009: 24) lays down the strategies for achieving these
goals as follow:
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(1) Implementing a detailed Environmental Impact Assessment (EIA) on all
planned energy projects backed by a detailed baseline ecological data
against which subsequent environmental changes and/or impacts can be
measured;
(2) Developing a rational National Energy Utilization Master-Plan that
balances the need for conservation with the utilization of premium energy
resources for premium socio-economic needs;
(3) Encouraging the use of energy forms that are environmentally safe and
sustainable, particularly solar energy;
(4) Promoting and encouraging research for the development and use of
various locally available energy sources especially non-conventional
resources such as geothermal, solar, wind and other complex forms of
hydrocarbons other than oil and coal.
This paper finds all the strategies sound and the last three insightful. The last three recommendations
support the development and use of RE sources for creating a balance between energy needs and
environmental protection. They encourage the use of environmental sound technologies for power
generation unlike current fossil-fuel technologies that dominate the industry. They also encourage using
locally available RE resources for energy, and recognize conservation of resources as the hallmark of
energy and environmental sustainability. This article adopts these recommendations.
More direct RE policies contain important provisions addressing RE interests. The policy
overview of the National Energy Policy (NEP) describes its purpose as the “optimal utilization of the
nation’s energy resources for Sustainable Development”. The policy mandates the government to
harness hydropower, solar, biomass and wind energy potentials available in the country for electricity
generation. The policy on hydropower states that enterprises should harness hydropower in an
environmental-friendly manner, and advocates promotion of private sector and indigenous participation
in hydropower development in order to, among other objectives, increase the percentage contribution of
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hydro-electricity to the total energy mix, conserve non-renewable resources that stakeholders use for
generating electricity, diversify the energy resource base, and limit potential ecosystem damage arising
from hydropower development. The policy desires that stakeholders develop the science and technology
they employ for solar, wind and biomass energy generation and/or conversion.
The Renewable Energy Master Plan 2005 is also an important policy instrument in the RE
discourse. Produced with support from the United Nations Development Plan (UNDP), the document
articulates Nigeria’s vision for achieving SD and the road map for achieving the RE content of the
National Environmental Policy 2003. The federal government launched it in 2005. It contains the
following programmes with short, medium and long term targets: National Biomass Energy Programme,
National Solar Energy Programme, National Hydropower Programme, National Wind Energy
Programme, Emerging Energy Programme, and Framework Programme for Renewable Energy
Promotion. It articulates issues that are common to other subsectors such as legal, regulatory and
institutional frameworks, incentives (financial and fiscal), capacity building (human and infrastructural),
inter-agency/governmental collaboration, research and development, monitoring and evaluation, and RE
portfolios and feed-in-tariffs.
Other policy instruments for developing RE include National Energy Master Plan 2003 which
developed strategies for improving the energy sector and has considerable provisions on RE
development, Renewable Energy Policy Guidelines 2006 which created directives for developing
support policies for RE, Nigerian Biofuel Policy and Incentives 2007 which articulates using ten percent
ethanol (E10) and twenty percent biodiesel (B20) as automotive fuels and was approved by the Federal
Executive Council in 2007, Rural Electrification Policy which targets how rural areas could develop
their electricity resources especially while employing renewables, Nigerian Millennium Development
Goals (MDGs) 2000 which features how Nigeria could achieve sustainable development (SD) and
reduce poverty by employing RE, the National Economic Empowerment and Development Strategy
(NEEDS) 2003-2007 which projected how Nigeria could improve economic welfare including energy
interests which RE could provide, and the International Renewable Energy Agency (IRENA) Statute
2010 embodying RE development guidelines which Nigeria ratified.
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Although these energy reforms and the national resources expended on RE development in
Nigeria in the last 11 years are substantial, the total amount of RE investment is still insignificant when
one compares it to the amount governments at different levels and other stakeholders allocate to
conventional energy sources (petroleum) servicing less than 40% of the population (Vincent-Akpu 2012:
5). Meanwhile, RE presents the most efficient and effective means for achieving SD, integrating
community level scale energy goals with large scale industrial interests. Moreover, RE by its nature
reconciles developmental goals and environmental concerns, creating a balance between the two.
For RE to integrate development and environmental protection interests successfully, it needs
better regulatory frameworks than what it currently has. Ladan (2009: 13) emphasizes this point as
follows:
Sustainable development in developing countries can hardly be achieved
without rural applications of efficiency and renewable energy, thus
underscoring the necessity for a dynamic and efficient legislative and
regulatory system. All such regulatory systems must require a number of
tasks to be performed: as an exercise of policy-making. The goals of rural
applications of efficiency and renewable energy regime must be
established; those goals must then be translated into the principles and
rules that control behavior of the principal actors; and there must be
procedures for explicating and enforcing the principles and rules and for
the adjudication of disputes arising from them.
At a general level, there are already RE goals across environmental and energy-related policy
instruments and laws. To specifically cater for RE interests effectively however, policy instruments need
to prescribe rules of behavior for stakeholders and procedures for enforcing them. These rules should
also provide for dispute settlement procedures and suitable adjudicatory systems. These are minimum
features that one would expect in any regulatory system that may successfully integrate RE into the
current energy sector.
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Scholars have addressed some issues on what the nature of renewable energy principles should
be, presenting lessons that one may draw from. For example, Emodi et al. (2014) have addressed the
issues of standards for renewable energy technologies; Chukwu et al. (2014) address issues concerning
the training and capacity of engineers generally; and Abam et al.(2014) discuss issues of resource
structure and sustainable development policy. Despite these attempts, there are other issues that need to
be clarified on what the nature of goals that promote RE should be, and how realistic the goals should
be.
The goals of renewable energy principles should be ideals that could drive realistic RE support
models. They should be statements of what ought to be, assuming all things are equal. While it does not
matter whether jurisdictions can fully achieve these ideals, it does matter that these ideals are feasible
and realistic. Their purpose is to guide rule-making and innovation in RE development. These goals
would guide and drive the policies and laws that suit RE support models. If jurisdictions comply with
the goals, they have the prospects of producing idealistic but yet realistic policy frameworks for RE.
One hopes that the federal, state, and local governments will pursue ideal principles for
developing renewable energy within their jurisdictions. They should look into the possibility of
codifying some of the principles for guiding the behavior of stakeholders. Codifying the principles as
rules in statutes makes the standards and rules of engagement that they set for actors and stakeholders
enforceable. The proposed codification should embody rules and principles that sufficiently address RE
issues in the context of development and environmental protection interests.
B. What Roles Should Regulatory Institutions Play?
A regulatory framework that aims giving efficient and effective support to RE should design not
only suitable regulatory objectives and rules but also well suited regulatory institutions that can enforce
them. These requirements are cumulative such that they should happen together. Ladan (2009: 26)
illustrates this point:
…regulations and energy policies have a direct impact on the success of
energy markets generally, market participants and stakeholders, as well as
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products and services. However, the exact nature and scope of this impact
will depend on how effective the implementing agencies or institutions
are. Regulatory institutions can either promote or defeat the goals of
regulatory policy captured in legislation or regulations.
Regulatory institutions should be able to push regulatory policies. The purpose of the institutions should
be to promote the policy goals, and drive the policy instruments. Where regulatory institutions fail to do
these, they become ill-equipped for ensuring that RE succeeds in existing energy markets that petroleum
resources already dominate.
In order to consider the roles regulatory institutions play in RE development better, one needs to
draw practical examples from the electricity industry which is currently the biggest energy sector in
Nigeria engaging RE. The jurisdiction to establish a legal and regulatory framework for power
generation, which may be pro-RE such as the one that establishes a legal requirement to make
proportionate purchases of RE or one that stipulates a Feed-in Tariff (FIT) for RE, is largely within the
purview of the Federal Government of Nigeria (FGN), acting through its regulatory agency, the National
Electricity Regulatory Commission (NERC) (see Federal Government of Nigeria [FGN] 2004: section
13 as against section 14, and schedule Part II Item F; see also Lagos State Ministry of Energy and
Mineral Resources 2012: 6, 11). Similarly, the power to legislate on a fiscal and investment regime for
RE such as one creating key incentives for promoting utility-based electricity from renewable sources is
largely within the jurisdiction of the FGN (Lagos State Ministry of Energy and Mineral Resources 2012:
6). The FGN regulates the activities of the electricity industry, particularly the activities of operators that
connect to the national electricity grid which the Transmission Company of Nigeria (TCN) controls, and
this regulation is instrumental in the general energy sector as it largely affects the sector’s performance
(Lagos State Ministry of Energy and Mineral Resources 2012: 6).
Again, the FGN is solely responsible for legislating on incomes and capital gains taxes in
Nigeria, and it has the legislative authority to prescribe fiscal incentives and tax concessions for RE
companies in Nigeria. Fiscal and financial concessions and support determine the success of many
business ventures because investors are mainly interested in profit margins. These facts make the roles
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of the federal government important in the process of designing implementation strategies for RE
business. This is not to say that state and local governments do not have roles to play.
The constitution of Nigeria vests the legal basis for off-grid electrification on rural areas falling
in each state of the federation (FGN 2004: Part II, section 14; Ladan 2009: 26). Commentators believe
that the government expects rural areas to generate off grid power from RE resources (Ladan 2009: 26).
State governments are expected to establish electric power stations within their states to generate,
transmit, and distribute electricity to areas not covered by the national grid system (FGN 2004: Part II,
section 14). State governments are also to take part in implementing monitoring schemes at the
grassroots (FGN 2004: Part II, section 14; Lagos State Ministry of Energy and Mineral Resources 2012:
9-11)
This article acknowledges the important roles state and local governments play at the municipal
level as they are the closest to the people. State and local governments can help promote RE at the
grassroots, thereby reducing environmental hazards that are closest to the people. As environmental
justice proponents usually argue, the poorest people suffer the most in environmental violations. While
this point presents further issues that may be relevant for knowledge in this area, this study focuses on
the roles of the federal government since many Nigerian state and local governments have different
policy approaches.
There is currently no single federal government institution (as well as state government and local
government institutions) with the mandate to solely regulate the RE industry in Nigeria. Nigeria does not
give RE technologies that could, in principle, meet almost all its energy needs such as solar power, wind
power, geothermal energy, and wave power any specific regulatory prominence (Ladan 2009: 32). The
institutions that perform regulatory roles in the RE subsector have mandates that are too broad, making
them unable to fully support RE interests.
Nigeria established the ECN by Decree No. 62 of 1979, amended by Act No.32 of 1988 and Act
No. 19 of 1989, later codified as Energy Commission of Nigeria (ECN) Act No. 109, Laws of the
Federation of Nigeria (LFN) 2004 (Energy Commission of Nigeria [ECN] 2013). ECN commenced
operation in 1989 after the meeting of the Heads of States of the Economic Community of West African
States (ECOWAS) in 1982 at Conakry where the participants made a declaration that each member state
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should establish an agency called “Energy Commission” and charge it with the responsibilities for
coordinating and supervising all energy functions and activities within the country.
Nigeria established the ECN as an agent of the FGN responsible for the strategic planning and
coordination of Nigeria’s policies on energy in all its ramifications (ECN 2013). The ECN is also
responsible for overseeing energy resources in Nigeria including RE (UNDP 2010: 14). Its mandate
covers specific areas including making strategic energy plans, coordinating policy and monitoring
performance in the entire energy sector, laying down guidelines on the utilization of energy types for
specific purposes, and developing recommendations on how to exploit new sources of energy (UNDP
2010: 14). What one learns here is that ECN has broad mandates on RE, but other areas which its
jurisdiction covers serve as distractions to specific RE interests it may have. Interestingly, the Nigerian
National Petroleum Corporation (NNPC) also created a Renewable Energy Division (RED) in 2005,
saddling it with a mandate to midwife the birth of RE initiatives in furtherance of the dictates of the
Kyoto protocol. There is yet to be any evidence of considerable contributions that this department has
made to the development of RE.
With Nigeria establishing the ECN and lately the Renewable Energy Division (RED) of the
Nigerian National Petroleum Corporation, institutional support for RE ought to be a done deal in
Nigeria. Apart from regulatory institutions and other state actors, non-government stakeholders are also
showing interests in developing RE. For example, One Sky Network has been organizing workshops and
seminars in order to sensitize Nigerians on the benefits of RE and thus making a case for the use of RE
(Efurumibe 2013: 11). Nonetheless, the failures RE continues to experience despite these developments
show that loopholes still exist. Many of these loopholes relate to not only policy instruments, but also
prevailing institutional frameworks. This paper has addressed many of these loopholes, and believes RE
will profit if Nigeria’s decision makers adopt its recommendations.
5. Conclusion
Despite the institutional challenges that this paper has identified, the gestures of the Nigerian
federal government so far show the interest it has in diversifying the energy sector. The central question
that remains unanswered is on the reasons for the low ebb at which RE develops despite the increased
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interests the FGN and other stakeholders have shown in it. This paper has made some attempts in
answering this question, associating the problem to not only institutional defects but also the entire
policy system.
Nigeria has considerably exploited hydropower and commenced exploiting solar energy, but has
not exploited wind energy, bioenergy, and geothermal energy considerably despite their prospects in
different geographical areas of the country. State actors should enact RE statutes providing for
integrative development schemes for RE. Such schemes should consider the manner with which RE
resources exist in different geographical zones in Nigeria, while considering the interests the local levels
up to the federal level of government have. State actors should not consider the factors determining the
design of RE policy instruments without putting in mind how renewable resources would affect the
people’s needs. This will enable them put in place appropriate mechanisms for mitigating possible spill-
over effects on food and other needs. In addition to prescribing the rules of behavior, the statute should
also provide compliance mechanisms that will ensure enforcements.
RE policy instruments should create more incentives and concessions for investors. The current
schemes do not place RE fairly alongside its petroleum counterpart which has enjoyed incentives for
many years. Considering the environmental advantages RE has, increased government incentives will
cushion the current exorbitant capital investment requirements many commentators have associated with
RE technologies, hence encouraging the private sector to invest in RE. Fiscal and financial incentives
should cut across business stages, from incorporation to production. However, actors should support
production-based incentives more because they guarantee productivity.
The last recommendation is that federal, state, and local governments should establish
institutions that focus on RE. These institutions should have clear mandates and jurisdictions. To avoid
overburdening them with responsibilities, they should not implement actual RE projects. Instead, they
should focus on regulation, while streamlining actual business involvement and development processes.
They should ensure that stakeholders adhere to the provisions of policy instruments and the rules of
behavior that the instruments provide. They should follow up on productivity in the RE subsector, and
make necessary recommendations for modifications or/and improvements from time to time.
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If state and non-state actors adopt the recommendations this paper has set out, the chance of RE
entering existing energy markets will increase significantly. These recommendations will also influence
existing policy frameworks enormously, and may lead to reducing the support petroleum currently
receives in relevant statutes. Enacting new statutes focusing on RE may also necessitate altering other
statutes relating to many sectors including energy, environment, finance and business. Jurisdictions
within Nigeria may also need to restructure existing public institutions and/or establish new ones.
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