By 2030, it is projected that renewable energy will provide 57 percent of global power generation. The International Energy Agency (IEA) estimates that achieving this target will gulp $49 trillion. Unfortunately, Nigeria is reportedly missing out on this projected investment.
This is because major marketers are said to be shunning the country due to some challenges which include instability in the power sector, poor regulatory framework, harsh business environment and a high degree of risks and insecurity.
The Nigerian Electricity Regulatory Commission (NERC) has set a target to generate a minimum of 2,000 megawatts (MW) of electricity from renewable energy by 2020. The Federal Government has also developed the National Renewable Energy and Energy Efficiency Policy (NREEEP) with short, medium and long term targets of achieving certain percentage of renewable energy in the country.
Unfortunately, we failed to meet the short term target of five MW of biomass, 15 MW of wind and 117 MW of solar both photovoltaic (PV) and concentrated solar power (CSP) by 2015.
And there is no indication that we will meet the medium-term target of 57 MW of biomass, 632 MW of wind and 1, 343 MW of solar electricity by 2020. It appears that meeting the long term target of 292 MW of biomass, 3, 211 MW of wind, and 6, 832 MW of solar (PV and CSP) by 2030 will be a tall dream.
Even the old method of using fossil fuels to power our energy needs is not working because the highest we have achieved is 5,000 megawatts. The burning of these fuels has even worsened the release of greenhouse gases to the atmosphere. Sometimes, there are short supplies of gas to the National Grid which cause reduced power generation.
This, last year, led to the shutdown of four power stations and a sharp drop in power generation from 4, 000 MW to 2, 039 MW. Unlike South Africa, which generates a total of about 51, 309 MW from both thermal power stations and renewable energy sources, Nigeria still has a long way to go.
This power deficit has posed serious challenges to many multinationals. Many of them have relocated to other countries while some generate their own electricity at huge costs. Some of them have closed down their operations.
The solution to the nation’s power challenge lies in renewable energy. Countries such as Australia, Greece, United Kingdom, Sweden, and Denmark have massive investments in it. About 29 US states have reportedly set policies aimed at increasing its usage. Australia is aiming at becoming a major power in its export to help diversify its economy.
Last month, the Australian government reportedly awarded A$22billion (US$16bn) contract for solar power project in its Northern Territory.
Greece has also taken steps to simplify renewable energy licensing. The country’s Ministry of Environment and Energy seeks to radically reduce the average licensing time for renewable energy projects from the current five/seven years to two years. Also, the country will grant quick use-of-land approvals for solar projects ranging in size from 1MW to 10MW. Previously, the upper limit was 2MW.
Many International Oil Companies are also looking towards sustainable energy investment. US energy manufacturing and logistics company, Phillips 66, has plans to reconfigure San Francisco Refinery in Rodeo, California, from producing fuels from crude oil to producing about 680 million gallons of renewable diesel, gasoline and sustainable jet fuel from used cooking oil, fats, greases and soybean oils. Recently, BP announced plans to cut down on oil and gas production and concentrate on clean energy.
In Africa, investments in renewable energy are increasing though the continent’s installed five gigawatts (GW) of solar photovoltaic (PV) is less than one per cent of the global total.
Perceptions of risk and financing shortfalls, among others, scare away many investors. According to the International Renewable Energy Agency, Africa could meet a quarter of its indigenous energy needs through renewable sources by 2030 with the right policy framework and investment. The European Union has significantly supported renewable projects in Africa.
In South Africa, there are plans for additional wind power installations which will add 3.3 gigawatts to its energy capacity by 2024. Last year, Kenya reportedly opened Africa’s largest wind farm. It is also exploiting other sources such as geothermal and solar to boost its renewable energy.
Nigeria’s renewable energy project must not be allowed to fail. The country has abundant natural renewable energy sources like solar, wind, biomass and hydropower. The government must harness them to boost our power supply.
It should engage experts in the field and woo investors to invest in the power sector by giving financial incentives and tax holidays to companies willing to invest in renewable energy. The National Assembly should enact a renewable energy law that will make the sector attractive to investors.