By Obiabin Onukwugha
The African Development Bank (AfDB), has stated that integration of renewable energy within the energy mix is crucial and key for Nigeria energy transition.
Director General, Nigeria Country Office, of the AfDB Group, Mr. Lamin Barrow, stated this at the 3rd Anniversary Lecture and Presentation of the Hero of Environmental Actions for Development (HEAD) Awards of NatureNews Newspaper In Abuja, on Tuesday.
Barrow, who delivered the Lecture titled, “Climate Change and Energy transition in Nigeria”, stated that African countries, especially Nigeria and South Africa, require huge financial investments to transition away from fossil fuels to more sustainable ways of energy generation.
The AfDB Nigeria Office Director General, described the topic of the lecture as timely as it is coming at a time when many countries globally are re-defining the climate-energy nexus.
He noted that the newly passed Nigeria Electricity Act (NEA 2023) has triggered a new round of sector reforms in the country, as it seeks to drive up renewable energy generation for increased energy access.
He said: “According to an African Development Bank Report published in 2021 on “Financing a Just Transition in Africa: Challenges and Opportunities”, the Bank acknowledged that some countries, such as South Africa and Nigeria, with high reliance on fossil fuels, and subject to a large informal sector, ensuring just energy transition will require huge financing needs on transitioning these countries away from fossil fuels to more sustainable ways of energy generation.
“This will require high levels of capital, financial innovation, and social protection systems, to reconcile the loss of revenue and employment incurred by moving away from old models of energy production. Also, funding for renewable energy projects and investing in green jobs and financing the reskilling necessary for the absorption of existing local labour into these projects will be fundamental.
“Gas remains a strategic commodity for Nigeria and a transition energy source. The power sector is currently 80% fuelled by gas and 20% by hydro. While the country has several off grids and decentralized renewable energy systems mostly in rural locations, less than 1% of renewable energy is connected to the grid. No renewable energy project is connected to the grid.
“Integration of renewable energy within the energy mix is crucial and key for Nigeria energy transition. This can be achieved through the following: (i) promote decarbonization goal through carbon market; (ii) embedding innovative technology to catalyse green growth; (iii) scale-up the use of natural gas rather than PMS and liquid fuels; (iv) scale-up in renewable energy technologies; (v) adopt fiscal incentives to promote renewable energy utilization including subsidies, tax holiday, investments, grants and import exemption to incentivize prospective investors.”
Barrow pointed out that the African Development Bank’s new Climate Change and Green Growth Framework Policy 2021-2030 and the Nigeria Country Strategy Paper (2020-2024) are both hinged on ensuring climate-compatible development.
He highlighted the importance of Gas monetisation, pointing out that the Bank is supporting Nigeria in her effort.clean energy solution drive.
“In the urban areas, focus will be on energy efficiency in both new and existing buildings; design buildings to utilize more natural lighting and consume less energy. Furthermore, there is need for policy reform, carbon tax, eco-labelling, carbon market to send long-term policy signals.
“The African Development Bank’s new Climate Change and Green Growth Framework Policy 2021-2030 and the Nigeria Country Strategy Paper (2020-2024) are both hinged on ensuring climate-compatible development.
“Hence, ensuring Nigeria’s energy transition is of strategic importance in promoting low-carbon and climate resilient development, and supporting implementation of the 2050 Long-Term Vision which recognizes that addressing climate-energy nexus presents challenges for the country’s development due to its high reliance on the oil and gas sector.
“Therefore, the Bank is supporting Nigeria to intensify the national effort to diversify Nigeria’s economy and lead to the development of low-carbon technologies such as solar clean cooking solutions, energy efficiency technologies and alternative energy. It will also help to achieve gas monetization and reduce gas flaring in line with the Nigerian government’s anti-flaring policy by utilizing natural gas which would otherwise have been lost and flared into the host communities’ atmosphere,” he stated.