Renewable energy market & policy development in nigeria


Published on

The Nigeria Alternative Energy Expo is Nigeria’s leading Energy Expo. NAEE features line-up of local and international speakers, delegates and exhibitors, who will gather to debate a new energy future for Africa's most populous nation

Published in: Technology, Business
  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide
  • Water channeled through basin to remove sediment Directed downhill through pipe drives turbine at the bottom can be used for mechanical power or connected up to a generator to produce electricity Generator provides AC power frequency dependent on turbine
  • Renewable energy market & policy development in nigeria

    2. 2. Introduction Nigeria is endowed with significant renewableenergy resources. This is due largely to the factthat the country lies within a high sunshine belt.Within the country solar radiation is fairly welldistributed. According to Dr Chris Omeruo themanaging director/ CEO BGL Private Equity Ltd,‘’ Nigerian Renewable Energy market isestimated to worth at least US$7.5 billion, withsignificant market potential to grow to aboutUS$10 billion or more’’.
    3. 3. Renewable Energy Resources• Hydro Power• Solar Energy• Wind Energy• Geothermal Energy• Bio-fuel – Ethanol, Bio-Diesel, Bio-Gas, Bio-Mass.
    4. 4. A Solar Array
    5. 5. Renewable Energy PotentialsThere exist a vast biomass potential in the form of: biocrops and wood fuel, biogas input potential, small hydro,wind and solar energy. For example; the solar potentialat average is put at 3.5Kwhr/m². Enough energy falls onthe average rooftop in one day to run a small householdfor a month.The bio-mass potential in this country isenormous, Potentials abound for wind energy and smallhydro
    6. 6. Renewable Energy Master Plan Targets (MW)Source 2007 2015 2025Wind 1 20 40Solar PV 5 75 500Solar thermal - 1 5Small hydro 50 600 2000Biomass 50 400Total Renewables 56 746Total Electricity 7,000 14,000 29,000% Renewables 0.8 5 10 Source: Renewable Energy Master Plan (ECN)
    7. 7. Is the Ret Market Limitless?The situation that can be observed is quite the opposite:• Energy supply on all fronts is grossly inadequate at commercial, domestic and industrial levels. This is especially so at the rural level where an estimated 70% of Nigerians live.• A total absence of electric power supply from the national grid in at least 70% of rural communities, coupled with inadequacy of supply even in urban and semi urban communities.• Per capita consumption of energy is well below the expected level given the resources available.• Low propagation rate of the RET s on offer and a stiff resistance of the population in adopting such RETs due to lack of awareness.• Stagnation in the R&D sector especially in its linkage with the main theatre of demand: the rural sector.
    8. 8. However, efforts have been made before and are still beenmade in many fronts to confront these challenges by variouspublic sector agencies:•Energy Commission of Nigeria,•The Federal Ministry of Science and Technology, Othersare ; non-governmental, international donors and privatesector developers .•Private sector companies and other actors in the market•International agencies concerned with the environment andanxious to institute a more sustainable dependence on theenvironment.•Nigerian Electricity Regulatory Commission
    9. 9. Success made so far:The awareness campaign carried out by the Energy Commission of Nigeria hasincreased the awareness level of the renewable energy technologies.( to a significantextent)•Policy and other institutional framework changes are more favorable to thedeployment of RET as contained in the new Energy policy and the draft master plan•Several more federal ministries, governmental and non governmental agencies havecome on board the RE train with master plans, pilot and demonstration projects.•Price of renewable energy equipments i.e. solar panels keep reducing.•The Federal Ministry of Health and the Federal Ministry of Water Resources havedeployed thousands KWp capacity of Photovoltaic based systems towards waterpumping and vaccine storage.The industry has grown some what with now much larger number of companiesservicing the industry.
    10. 10. Major challenges within the renewable energy industry•The diffusion of the RET s downwards to the rural level is insignificantat the domestic and rural economy level where demand is most crucial.•The preponderance of projects and activities are still unacceptablyskewed towards government sponsored projects or similar high profileprojects.•Per capita consumption of energy has not improved significantly•The impact of the renewable energy technologies on the rural energyconsumption pattern is too scanty to be described as successful.No significant milestone has been recorded in local content especially inthe areas of solar photovoltaic and solar thermal manufacturing industry.
    11. 11. Cont.• Shifting the utilization to the most crucial demand theatre (The rural areas).• The rate of failure of projects in the country is too high which signposts deep underlying problems.• Not much success has been recorded in import tariff reduction and other incentives in general• Energy tariffs are still unfavorably tilted against RET generated electricity while other forms of energy and electricity enjoy hidden subsidies• Innovative approach to energy financing is still missing
    12. 12. Policy and Regulatory Overview• Electric Power Sector Reform Act 2005• Petroleum Act / Petroleum Refining Regulations (Favors Ethanol production)• Public Enterprises (Privatization and Commercialization) Act• Kyoto Protocol• Environmental Impact Assessment Act• National Office of Technology Acquisition and Promotion Act• Standards Organization of Nigeria
    13. 13. Policy Statements• National Energy Policy• Renewable Energy Master Plan (REMP)• Renewable Electricity Action Program• National Biofuel Policy.There also exist policies at the state level such as:• Cross River state-Draft alternative energy policy.• Ebonyi State: -Draft alternative energy policy.
    14. 14. Electricity Law•National Electric Power Sector Reform Act (EPSRA)•Independent Power Producers•Wholesale Competitive Electricity Market•Licensing requirements for generation over 1MW(except captive generation)•Licensee authorized to construct, own, operate andmaintain a generation station for purposes ofgeneration and supply of electricity in accordance withEPSRA•Tariff Regulation – Multi-Year Tariff Order (MYTO)•Regulation by NERC
    15. 15. Petroleum Law•Renewable Energy Forms, Bio-fuels: Ethanol,Bio-Gas•Ethanol as additive to petrol (PMS)•Bio-Gas as Liquefied Petroleum Gas (LPG)•Ethanol-PMS blending as refining activityunder Petroleum Act / Petroleum RefiningRegulations•Downstream Gas Bill
    16. 16. Incentive RegimeThere is no specific incentives for renewable energy but there are generally applicable incentives:• Pioneer Status – Industrial Development (Income Tax) Act• 10% Investment Allowance on plant and machinery• 10% of total profit deductible for R&D• Agricultural Incentives• Zero duty on agricultural machinery .
    17. 17. RecommendationsAwareness• Setting up of renewable energy awareness programs (including solar villages in each state)• Building up partnerships between government, private sector and civil society.Technology Research and Development• Intensifying R & D in renewable energy science and technology as well as policy analysis and market research.• Carrying out manpower development for the design, production, installation and maintenance of renewable energy technology• Developing and implementing national standards on renewable energy devices and systems• Establishing an enabling regulatory framework for the renewable energy industry and renewable energy based power
    18. 18. Economics and Financing• Establishment of public and private sector partnerships to mobilize financial resources for the development of the renewable energy industry• Developing and making available a road map to guide project developers in their efforts to access financial resources• Promoting an energy pricing structure which is market-based and which reflects long term benefits and environmental costs• Removing all tariffs on imported renewable energy technologies and systems• Establishing a renewable energy development fund and a mechanism for operating the fund.
    19. 19. Recommendation contd. Institutional Reforms• Providing institutional linkages between public and private sector institutions and renewable energy end users with regards to funding and information exchanges• Strengthening the capacity of various renewable energy institutions. Policies• Implementation of an integrated national energy policy• Implementation of an enabling renewable energy policy
    20. 20. INVESTMENT SUPPORT• Establishment of a renewable energy development fund• Development of a road map for accessing investment and support funds (sources of funds, types of funds and how to access them) for renewable energy projects• Putting in place policy incentives to make renewable energy technologies economically competitive.
    21. 21. ConclusionThe growing market trends for renewable energy can beincreased and sustained as experience with renewableenergy policies around the world is still emerging andmore understanding is needed of the impacts of variouspolicies. Thus, many policies could still be considered“experimental” in nature.Of all the policies surveyed so far, the ones that appear tohave contributed the most to renewable energydevelopment during the 1990s and early 2000s are:
    22. 22. (a) directct equipment subsidies and rebates, net meteringlaws, and technical interconnection standards in the caseof solar PV. (b) investment tax credits, production tax credits,electricity feed-in lawsc) grid-access and wheeling policies supportingindependent power producers and third-party sales in thecase of biomass and small hydro power.
    23. 23. There is no gain saying that the Market forrenewable energy is huge , and the benefits outweighs its conventional counterpart, and so, thiscalls for continuos collaborations which willenhance knowledge sharing, technologicaltransfer and market propagation , in order toachieve a green and safe planet which has thepotental to cater for the need of the present andthe future generation.
    24. 24. Thank You