Promoting a sustainable energy policy environment in Nigeria

By Akachukwu Okafor 28/04/17

energy-access

Sometimes I wish that Nigeria’s power sector challenges are solved so that I will have less to write on, but this seems not to be happening as issues keep arising in this large and troubled electricity market with its various actors and stakeholders.

After my last publication on the feasibility of the power sector recovery plan, I received several messages from key sector players including from a diplomatic mission commending the article’s insightfulness and asking that I share a copy of the recovery plan if I had it. At the time the last article was published, I did not have the plan and my preliminary analysis was based on the media briefing by the Minister of Power after the approval of the plan. However, I have obtained the plan now and I hope to further analyse the plan based on the specific programmes it hopes to embark on. The feedback I found most interesting was from a former Chairman on the Technical Committee of National Integrated Power Project (NIPP) who was not happy that I did not emphasise how DISCOS, in truth, collect a lot of revenue, but turn around to claim to other market players that they collect little and are operating at a loss. He described DISCOS as the problem of Nigeria’s electricity sector for not remitting revenue and refusing to invest in upgrading their infrastructure.

I promised to be more critical of all players in the sector especially DISCOS as I have always been (and as allowed by word count – it will take not less than a 5,000 word article to analyze how DISCOS are a big problem for Nigeria’s electricity sector). I still do not understand how the government strongly believes that DISCOS operate two accounting books and yet, have not taken appropriate and necessary actions to ensure that they are more transparent and accountable. This lack of transparency and accountability helps in the low revenue base of the power sector which starves it of the finance it critically needs for reforms and recovery programmes. Interestingly, these and other issues including enforcing corporate governance from power sector operators, enforcing market discipline, developing a coherent strategy to resolve militancy and making a definite policy statement on tariff are among sector issues that the World Bank listed as conditions for the release of $1 billion needed to help fund power sector programmes.

Speaking of definite policy statements, according to a World Bank global scorecard for policy makers which compares the national policies and regulatory frameworks for sustainable energy amongst different countries, Regulatory Indicators for Sustainable Energy (RISE), February 2017, Nigeria ranked amongst the worst countries with regard to enabling policy environment for energy access, energy efficiency and renewable energy. Of 111 developing and developed countries studied which represents 96 percent of the world’s population and energy consumption, Nigeria scored very low for the three categories. For energy access, Nigeria ranked 10th worst country ahead of Liberia, Yemen, Mauritania, South Sudan, Sierra Leone, Chad, Haiti, Central African Republic and Somalia in that order. Countries that performed better than Nigeria include – Afghanistan, Congo Republic, Madagascar, Ethiopia, Eritrea, Niger, Togo, Sudan, Honduras, Mozambique. For energy efficiency, Nigeria was ranked 8th worst ahead of Somalia, Mozambique, Chad, Loa People Democratic Republic, Mali, Mauritania, Congo Republic while Niger, Central African Republic, Liberia, Vanuatu, Solomon Islands, Yemen, Burundi, Myanmar, Maldives, Haiti, Zimbabwe, South Sudan were among 12 countries that performed better than Nigeria. On the renewable energy category, Nigeria was ranked 21st ahead of Somalia, Haiti, Sierra Leone, Eritrea, South Sudan, Niger, Mauritania, Bahrain, Liberia, Congo Rep while Uzbekistan, Mozambique, Benin, Burkina Faso, Saudi Arabia, Kuwait, Cambodia, Congo Democratic Republic, Qatar were listed countries that performed better than Nigeria.

Although Nigeria’s renewable energy score improved by over ten places when compared to energy access and energy efficiency it was still 4 points below the indicator score mark for low performing countries. Nigeria’s performance on this scorecard will not come as a surprise to people with a good understanding of the energy sector in Nigeria. Space will not allow me analyse the report in detail. For instance, on the energy access category, Nigeria’s overall score for energy access was 22 and 0, 0, 17, 35, 22, 100, 0, and 0 for existence of plan, scope of plan, grid electrification, minigrids, stand-alone systems, affordability, utility transparency and monitoring, and utility credit worthiness indicators respectively. The most interesting aspect of these indicators is that consumer affordability of electricity scored 100 which is an indication that electricity consumers can afford to pay the cost of electricity.

This situation seems to be well understood by government and key electricity market players which may be what the Nigerian government is exploiting in its continued push for a cost reflective tariff for the market. However, consumer affordability of electricity is clearly different from willingness to pay for electricity which is one of the challenges that the grid sector is facing. The problem of willingness to pay borders on social issues of distrust with public utilities and citizens’ perception of government’s role in providing utilities which is mostly informed by politicians’ election campaign promises. The scores of the other indicators means that government has a lot to do in making the right policies and setting the right regulatory frameworks for an enabling environment that accelerates sustainable energy access.

On energy efficiency, Nigeria’s overall score was 11 out of 100, and this equally doesn’t come as a surprise especially when policy makers are not knowledgeable about their responsibilities to the sector. For instance, the Senate Committee Chairman on Power, Senator Enyinnaya Abaribe while responding to a question on how energy efficiency in Nigeria can be increased said that it is the job of energy efficiency appliance vendors to educate Nigerians on energy efficiency as it is not the job of government to lead energy efficiency programs, or in extension make enabling policies.

Unfortunately, the Nigerian Electricity Regulatory Commission (NERC) which should be helping policy makers better understand the sector which they are to make policies for and also supervise are not doing enough. A check on the capacity building programmes designed for legislators will reveal that most of the capacity building programmes are not specifically designed for policy makers in Nigeria’s difficult regulatory environment. Most capability building programmes are via sponsorship to international conferences that will add little or no knowledge for making the right country-specific power sector policies. The legislative committees, relevant government ministries and departments and agencies on power also lack experts who should help in crafting the right policies asides other capacity, institutional and bureaucratic challenges that trouble the sector.

Renewable energy is performing better than other categories; however, there are a few practices by some project implementing stakeholders especially government energy agencies and projects that are not only unhealthy for the immediate growth of the sector, but which will in the medium term, help destroy the progress being made by other stakeholders. These practices include poor design of projects, wrong costing of projects and lack of transparency in procurement and contract processes which lead the implementation of projects that fail within a short time. This gives a bad name to renewable energy technologies and products. To help promote sustainable energy in Nigeria, government must do what is necessary, not just in formulating enabling policies and regulations for growth but to ensure that these policies are implemented and enforced appropriately in line with best practices. While government and other stakeholders are working towards creating a more enabling sustainable energy policy environment, consumers must realize that they hold the power to wheel the ship of policy in the direction they desire, which can only happen when consumers effectively engage with the policy and regulatory making processes.

 

Okafor Akachukwu is the Energy and Environment Editor, The Initiative for Policy Research and Analysis (InPRA) and a Science Policy Research Unit (SPRU), University of Sussex trained Energy Policy, Innovation and Sustainability Expert. Email: akachukwu_okafor@yahoo.com

 

Paris Agreement -Nigeria has to depart from coal

By Okafor Akachukwu | 07/10/2016

coal-fired-power-plant

It is becoming increasingly obvious that those saddled with the responsibility of governing Nigeria’s energy/power system or articulating and implementing a strategic national energy plan starting from the federal ministries of power, petroleum resources, solid minerals development, environment, water resources, finance, budget and national planning, agriculture need to be properly schooled in the work that they should be doing. It is easy to decipher that they are not listening to briefs from experts, not talking to themselves across ministries, departments and agencies or not in touch with developments beyond the shores of Nigeria.

It’s shocking to read the statements allegedly made by Nigeria’s Finance Minister, Kemi Adeosun this Wednesday in Washington at some World Bank and IMF meetings where she accused western nations of blocking Nigeria’s efforts in building new coal fired power plants. While, I wouldn’t want to go into academics of climate science that led to the new Paris Climate Change Agreement which just a few weeks ago, (at the annual September United Nations General Assembly meetings) Nigeria’s President signed. Our dear Adeosun should have clarified the contents of the agreement before her statements. What she should have said was that Nigeria is blocking Nigeria’s efforts to build new coal fired plants. Our government officials and policy advisers should have informed her or Mr President that signing the Paris Agreement will mean no ‘cheap’ coal power plants for Nigeria – meaning that he may find it difficult to fulfil his electoral promises on delivering constant power to Nigerians by the end of his tenure.

We may have signed the agreement because it’s fashionable – other countries are signing. However, we failed to remember that we do not have the finances and technologies to solve our power challenges the way we prefer if we have no intentions of complying with the Paris Agreement. Else we forget, our ambitious Intended National Determined Contributions (INDCs) to the Paris Agreement of cutting 476 million tonnes per year of greenhouse gases (GHGs) emissions reductions in 2030 was drafted and submitted to the United Nations Framework Convention on Climate Change (UNFCCC) by the current President Buhari’s administration – we should have known better. Probably there was no communication and coordination across government at all levels to know what our national energy plans were, what should go into the INDC and what shouldn’t.

Did our government not know of the of US, UK, other European countries and the World Bank’s clear position to stop funding coal power plants in developing countries since 2013? In fact, the US stopped investing in new coal technology projects since 2011. The last World Bank funding approval for a coal fired plant was in 2010 for a plant in South Africa, which was strongly opposed by the US. The World Bank however is currently discussing a draft new energy strategy that may allow it to finance new coal plants only “in rare circumstances” where there are no alternatives. The Nigerian government should have known better, instead of the blame gaming it should be more focused, coordinated, proactive and innovative and go for other available energy options – if it is interested in solving Nigeria’s power challenges.

The world has moved on, the game has changed and if we don’t want to move with it, or join the game, or beat the game – we get stuck, stuck in darkness and underdevelopment. In the past month alone, there has been increased discussion on how to develop and grow the mini-grids sector (decentralized electricity generation and supply) especially using solar and accelerate investments in these sectors to boost Nigeria’s power supply and solve the energy access problem. For instance the Nigerian Electricity Regulatory Commission (NERC) has been conducting series of consultations around Nigeria on its 2016 Draft Minigrids Regulation, there was an International Finance Corporation (IFC – World Bank) and UK Department for International Development (DFID) workshop in Lagos and Abuja on developing and financing the solar mini-grids market in Nigeria, Power for All also held a workshop for government ministries, departments and agencies on accelerating the growth of Decentralized Renewable Energy (DRE) sector.

The Power for All workshop ended with a five point action plan which were: “1.) The need to Streamline government policies and regulations for the sector, 2.) Eliminate VAT and import duties, 3.) Streamline importation, 4.) Enforce quality and standard, 5.) Build markets – through equitable financing.” Aside these plans and more unmentioned, government should also make it easy for renewable energy funds trapped in various national financial institutions to be accessible to entrepreneurs that have the capabilities to utilize them. The usual argument is that renewable energy is expensive – but compared to what? The fact is that the initial cost of deploying renewable energy technologies and solutions may be expensive but it is far cheaper and affordable for consumers to pay for, cheaper for operators to operate and maintain and delivers enormous economic, social and environmental benefits compared to coal technologies which impacts can be generationally devastating.

A question we should rather be asking ourselves is why did we fail to develop our coal reserves in the past 50 years? Nigeria agreed that coal technology should be phased out when it signed the Paris Agreement and constructing new coal would be contrary to that agreement; hence it should quicken its efforts to harness other energy resources that Nigeria is abundantly endowed with. One thing I know is that no one would block Nigeria from building new gas, hydro, solar, wind, biomass, geothermal and tidal plants.

 

Okafor Akachukwu is a Science Policy Research Unit (SPRU), University of Sussex trained Energy Policy and Sustainability Expert. Contact: Twitter- @akachukwu, Email: akachukwu_okafor@yahoo.com

 

Sierra Leone on a path to achieve energy access.

By Okafor Akachukwu | 24/05/2016

Sierra-Leone-signs-energy-agreement-with-UK-2
Signing of Sierra Leone Energy Compact

Almost half a decade ago, billions of the world’s poorest and marginalized populations living in remote communities and urban slums including those in sub-Saharan Africa who do not have access to electricity now have some hope Like many other people in sub-Saharan Africa, many of Sierra Leone’s poorest and marginalized populations living in remote communities, who half a decade ago did not have access to electricity, now have some hope. There is a general air of optimism that soon they shall see with light bulbs and use home appliances powered with electricity, including having access to other well-being and livelihoods improvement services that come with having access to electricity. This optimism is fuelled by increased investments in energy infrastructure development especially in the deployment of decentralized, off-grid renewable energy solutions. One of such investments is the United Kingdom Department of International Development (DFID) Energy Africa Campaign, which was launched in October, 2015. Its aim is to help Africa to achieve universal energy access by 2030 through an investment portfolio of over £757 million using different mechanisms.

Two weeks ago, the first of the 14 Energy Africa Campaign agreement was formally concluded in Sierra Leone with an Energy Compact signed by UK’s International Development Minister, Nick Hurd and Sierra Leone President, Ernest Bai Koroma at an event to mark Sierra Leone’s Energy Revolution. The event which was organized by Sierra Leone’s Ministry of Energy and DFID with support from Adam Smith International, Sierra Leone Opportunities for Business Action (SOBA) and Power for All. The event also marked the launch of Power for All campaign operations in Sierra Leone, which is a campaign led by a network of actors in the renewable energy sector that “advances renewable, decentralized electrification solutions as the fastest, most cost-effective and sustainable approach to universal energy access”. According to its Director of Communications, Media, and Content, William Brent, Power for All will soon launch operations in Rwanda and Nigeria after its successful launch in Zimbabwe and Sierra Leone. President Koroma in his address during the launch committed to ensure that more than 50,000 homes will have access to solar units this year and 200,000 homes by next year. This is an interesting development that will complement and improve on the efforts of young Sierra Leonean renewable energy entrepreneurs and development actors.

One of such outstanding efforts is led by Smiling through Light, founded by a young female Sierra Leonean, Mariama Kamara, who is based in London. Mariama moved to London at age 9 and got back to Sierra Leone in 2011, to work in the development sector to improve and strengthen healthcare systems.

Smiling through light
Smiling through Light project beneficiaries in Sierra Leone

She got to learn about and witness the enormous energy poverty and decided to help change the situation. She subsequently setup Smiling through Light and with funding from Price Water Coopers (PWC), its first pilot project was successfully implemented. It has continued to work with a network of women to distribute and sell solar lamps and solar mobile phone charging units. Mariama’s work has not been without challenges.

She says that, “finding investment for the business has been my biggest challenge. It has been difficult to get financial support to grow the business. Financing for SME’s and challenges linked to the ‘missing middle” is an issue. And she asks, “How do we fill and support the ‘missing middle”? She also highlights the challenge of local content and knowledge transfer, “from my experience, I find that local entrepreneurs are not supported in the sector”. Mariama’s wish is to seek that more local entrepreneurs can have access to funding to enable them develop and grow the market, which accelerate adoption of renewable energy solutions.

It is encouraging that a lot of investment will be going into the sector which will catalyse growth, and help open up the space for participation. The hope of young entrepreneurs like Mariama is that these investments and increased participation will help solve the challenges is the sector. I also personally hope that organizations including Power for All will help remove these barriers to a successful Sierra Leone Energy Revolution.

Directing Nigeria’s Sustainable Energy Future

By Okafor Akachukwu | 12/05/2016

Trasmission

The debate for the future of Nigeria’s burgeoning energy sector may have just began. Few weeks back, the nation woke up to media reports that Nigeria’s power generation dropped to 0 megawatts (MW) for 3 hours when they were in bed. This wasn’t good news at least to the officials at the Power Ministry, who will have to remind Nigerians that the usual outages were a result of vandalised gas pipelines, union strikes and probably low volume of water at the dams. Some reports and opinion argued that the outage normally occurred, but this particular incident may have gotten wide media attention because of the current petroleum products scarcity in the country. These incidences are enough to spark public debates on Nigeria’s energy future. How long can we continue in darkness; what are the real solutions to the crisis; what better ways can we source our power needs in environmentally safe and sustainable ways? These discussions, especially the last, is likely not to come from the public, maybe not just yet. We aren’t used to engaging in debates, conversations that shape public policy.  We usually leave debates to the policy makers and interest groups who normally have only their interests to protect. What then happens to the general public interest?

The history of energy systems show that people do not really care where the energy they consume is sourced, they are often reluctant to do so. Energy debates have only evolved to become topics of public policy concern, especially when there has been an environmental catastrophe, as witnessed mostly in the late 70s and 80s. The US Three Mile and Chernobyl disasters are examples, including the recent Fukushima Daiichi disaster. These incidents sparked a new wave of movement and resistance against nuclear energy, which had a huge impact in directing the energy systems that exist today. Mostly recently, adverse environmental impacts of fossil fuel exploration, and consumption, and climate change impacts birthed new movements against continued fossil fuel use especially coal – the highest contributor of global carbon emissions. These changes have resulted in the development of streams of renewable energy (RE) technologies and solutions with diverse areas of applications. Something that was unthinkable two decades ago. Deployment of RE technologies is experiencing a rapid increase, eliciting debates of how this process needs to evolve and governed, and in which direction. On whose terms are the complex global, regional, national and local energy system changes going to happen? Who will direct this process and at what cost?

In 2012, the Government of Nigeria issued coal mining licenses in line with its ambition to use coal fuel to meet 30% of Nigeria’s electricity demands. Armed with these licenses, mining commenced with consequent environmental and health impacts on the communities that host mining sites. One of such communities is Okobo, a peasant farming community in Kogi State, Nigeria, that is host to coal mining sites that will power a proposed 1200 MW coal power plant located in another community called Itobe – also in Kogi State. These adverse environmental and biodiversity impacts have caught the attention and response of Global Rights, a human rights and justice focused organisation. Global Rights have started ask some difficult questions that stakeholders usually ignore or are reluctant to ask, or even work to find answers to. It organized a workshop to launch and debate on “Power at What Cost?” – A report that highlights the impact of coal mining and coal power generation on Okobo and Itube communities of Kogi state.” The report exposed the air, water, soil and other forms of environmental pollution that the community is suffering as a result of the coal mining.

The debate amongst the workshop participants exposed future severe dangers and challenges that Nigeria’s environment and energy systems is bound to face, if urgent appraisal of our energy strategy and enforcement of certain environmental laws are not undertaken. Unfortunately, the agencies and departments of government that are charged with these responsibilities lack the capacity and capabilities to act. For instance, a representative of the Ministry of Solid Minerals Development stated that the ministry lacks the resources to undertake regular inspection of most of the mines in the country. On the other hand, representatives of the Climate Change department, Ministry of Environment disclosed that it has no measure or framework of ensuring the that operations of coal mines in the country comply with strict environmental regulations that will ensure that: the environmental impacts are minimal, Nigeria meets its ambitious Intended Nationally Determined Contribution (INDC). Also, the Ministries of Power, Environment, Solid Minerals Development, Agriculture are yet to develop a plan on how Nigeria can implement its INDC of 476 million tonnes per year of greenhouse gases (GHGs) emissions reductions in 2030 through different measures that do not include coal, generate 13,000 MW of electricity from off-grid solar PV. Incidentally, the activation of power from coal is unlikely to help the situation. Other questions that came up during the workshop were as follows: What are the true costs (financial, environmental, socioeconomic, health impacts) of power from fossil fuel – coal, gas and renewable energy such as solar, wind, biomass? Who should bear these costs? What should be the contribution of various energy sources to the energy mix? How can the system meet the very complex and dynamic demands while keeping issues of human rights, equity and social justice obligations towards the poorest and marginalized groups on the front burner?

The conversation that will deliver efficient, reliable energy systems, promote energy access across all sections of the population and promote sustainable development need to grow bigger than the conversation at the workshop. The system needs to be open to participation by all actors and stakeholders, who must take ownership of the system and demand that the interests of all sections of the society be represented in Nigeria’s future energy system.

Promoting Energy Access in sub-Saharan Africa

By Okafor Akachukwu  | 09 May, 2016
AkaRE
Akachukwu Okafor (Convenor, Energy Access Dialogue) on the rooftop of a residential property in Abuja that runs on 100% renewable energy. 

Growing up as a nursery school kid in Kano, a city in Nigeria North-Central region some 27 years ago, I went to bed in an air conditioned room and required no assistance to use the bathroom in the middle of the night. I woke up with lights on, had a warm bath, eat hot breakfast, wore ironed school uniforms and had my lunch box with a flask of hot beverage. On return from school I always had my cool afternoon swim in the bath tub. I studied in a well-lit room at night. I never missed favourite TV shows. There was just enough electricity to do whatever I wanted as a child. Elsewhere in Nigeria and sub-Saharan Africa the story was different for another kid of my age and still is today. Today in the same city of Kano, other cities in Nigeria and elsewhere in less developed countries, many kids who could have afforded such a lifestyle can’t. The story and situation in rural and remote communities is totally different. There is absolutely no electricity to live such standard of life. The experiences for other members of the population especially women and small and medium scale businesses reveals enormous energy poverty that is in most less developed countries.

Solutions for fixing the energy system to meet rising energy demands, achieve universal energy access, improve efficiency and cut carbon emissions are complicated, complex and dynamic. Interestingly, the energy system if fixed, has enormous potentials to accelerate economic development, eradicate poverty, improve livelihoods and wellbeing, improve health care systems and deliver sustainable development. Unlike 3 decades ago, there is a basket full of energy sources to generate electricity from, consuming population and demand have more than trebled, actors – institutions, groups and stakeholders that are responsible for system governance have also increased – each with a different interest to protect and advance. The United Nations Sustainable Development Goal Seven (SDG7) aim that by 2030, all people in the world will have access to affordable and clean energy, the share of renewable energy in the global energy mix to increase substantially, global rate of energy efficiency improvement doubled. Other targets include to enhance international cooperation to facilitate access to clean energy research and technology, promote investment in energy infrastructure and energy technology and expand and upgrade energy infrastructure and technology for supplying modern and sustainable energy to developing countries.

These are quite ambitious, demanding targets which require consistent and open conversations and collaborations among actors and stakeholders, across different networks, institutions, groups, sectors, industries, geographies and levels of system governance that make up the global energy system. These conversations would help actors have holistic, unfragmented, integrated system understanding of the challenges of the energy system and collaboratively articulate and implement effective solutions. Furthermore, they will help determine how the actualization of these targets will evolve, coordinated and implemented. Energy Access Dialogue aims to provide platforms for these conversations to start happening. Specifically targeted to sub-Saharan Africa, dialogue sessions will discuss different issues including energy generation – centralized systems (transmission, distribution, connection, metering), off-grid renewable energy technologies and solutions, grassroots innovations, revenue collection challenges, technical capacity deficits, challenges of labour and union laws and actions, economic and sociocultural, behavioural/lifestyle, political, investments – markets, service provisioning challenges. We have to understand these challenges the way they are, learn from solutions that worked and works, build success models, make adaptations, scale solutions that need to be scaled. Doing these would actually be one of the first steps to actualizing universal energy access and most of the sustainable development goals.