Introduction
The Nigerian National Energy Masterplan (2022) [1] is a policy instrument that remains one of the most ambitious outlooks for the future of energy in Nigeria. Nevertheless, as the country sets off on this important process of attaining energy security and sustainable development, it is important to question and analyze some assumptions and projections of the Masterplan. The purpose of this article is to provide a critical view of the National Energy Masterplan 2022 while identifying gaps and areas for improvement. In so doing, we aim to add a more informed perspective to the current general debate on Nigeria’s energy future and the efficient execution of the Masterplan’s noble goals.
Context
Nigeria’s energy poverty hinders sustainable development, ranking 84th in the 2022 World Energy Trilemma Index[2]. Despite vast energy resources, about 71% of the population (140 million) in 2024 lacks access to modern energy services[3]. With a population of about 229 million[4], the country’s installed capacity of 13GW (86% – natural gas, 14% – hydro sources) is insufficient, with an average available capacity of 4.5GW[5], failing to meet demand and hindering industrial development. To address this, the National Energy Masterplan aims to ensure a coherent, sustainable, and efficient energy sector. Its objectives include adequate energy supply, resource optimization, and environmental sustainability, achieved through strategies like integrated planning, stakeholder collaboration, and investment promotion.
Key Concerns and Challenges
The National Energy Masterplan’s effectiveness is compromised by several critical shortcomings. Notably:
- Unrealistic growth projections: The plan’s reliance on a 7% annual GDP growth rate is at odds with Nigeria’s actual GDP growth trends[6], averaging 5.6% from 2000 to 2023 and 3.2% from 2010 to 2023. This disconnect undermines the plan’s credibility and raises concerns about its ability to accurately forecast and address Nigeria’s energy needs.
- Lack of clear energy mix projections: The plan lacks clear projections for upscaling Nigeria’s energy mix, including the share of energy from renewables, timeframe, and infrastructure needs. This ambiguity hinders the transition to a sustainable energy future.
- Environmental implications ignored: The plan’s silence on potential emissions from exploiting oil, gas, and coal reserves is alarming. Without estimating CO2 and Methane emissions or providing a mitigation framework, Nigeria’s net-zero commitments and NDC goals are jeopardized.
- Financial clarity lacking: The plan lacks clear financial projections, omitting essential details on funding expectations, timelines, and strategic plans to meet financial targets. This absence of financial clarity raises concerns about the plan’s feasibility and potential for successful implementation.
- No assessment metrics: The plan fails to establish specific assessment metrics to measure implementation efficiency, neglecting crucial monitoring and evaluation tools. This gap hinders the ability to track progress and make informed decisions.
Pathways to Improvement
The Masterplan should align growth projections with Nigeria’s actual GDP growth trends to ensure credibility and accurate forecasting. It should also incorporate clear financial projections that detail funding expectations, timelines, and strategic plans to achieve financial targets. According to the Sustainable Africa Scenario (SAS), renewables are anticipated to dominate the African energy landscape, contributing approximately 80% of the primary energy supply and 27% of power generation. It is crucial to revise the Masterplan to include systemic approaches and projections that align with Nigeria’s realities and the broader African context. This will help leverage the potential of renewables to attract investments and meet projected energy demands.
The shifting landscape in Europe as a major global market and natural gas importer is transforming rapidly as the continent embraces renewable energy sources to enhance energy security. This shift has the potential to have a severe impact on Nigeria’s natural gas ambitions, with a potential decline in global market demand. This could result in stranded assets and significant financial losses, leading to a discouraging environment for foreign and local investments. To address this, Nigeria’s master plan should provide clear projections for upscaling its energy mix, including the share of renewables, along with a timeframe and infrastructure needed to adapt to the evolving energy market.
To effectively support Nigeria’s net-zero commitments and NDC goals, the master plan should prioritize investments in methane emissions reduction technologies. It should also provide an estimate of potential emissions from exploiting oil, gas, and coal reserves, and include a mitigation framework to address these emissions. Also establish specific assessment metrics to measure implementation efficiency and track progress, enabling informed decision-making.
The “Going Forward” Perspective
Nigeria’s Masterplan should align with actual GDP growth trends, incorporate clear financial projections, and prioritize renewables to attract investments and meet energy demands. The plan should address the impact of Europe’s shifting energy landscape on Nigeria’s natural gas ambitions and include projections for upscaling renewables, methane emissions reduction, and mitigation frameworks. This will help Nigeria achieve its net-zero commitments, avoid the possibility of stranded natural gas assets, and possibly aligning the country’s energy system with the realities of a global clean energy ecosystem.
Conclusion
The situation calls for a critical review of the National Energy Masterplan to foster a cohesive, sustainable, and efficient energy sector. The gaps identified above should be effectively addressed for Nigeria to attain its energy goals. These amendments will assist in bringing the plan into conformity with the Nation’s current energy situation and development objectives.
References
[1] ENERGY COMMISSION OF NIGERIA
[2] https://www.worldenergy.org/publications/entry/world-energy-trilemma-index-2022
[3] https://www.weforum.org/agenda/2023/05/how-nigeria-is-tackling-barriers-to-its-green-energy-transition/
[4] https://www.macrotrends.net/global-metrics/countries/NGA/nigeria/population
[5] https://www.vanguardngr.com/2023/06/energy-crisis-nigeria-needs-34-5bn-investments-to-provide-electricity-access-by-2030-report/
[6] https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?locations=NG&name_desc=true
***This article is co-authored by Gbemileke Kolade Kolawole, Research Associate EcoDataTrend
