Nigeria’s Energy Transition Plan Unbundles Investment Opportunities For Gas, Solar, Hydrogen, EVs

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By Tobi Owoyimika

The Nigeria Energy Transition Plan (ETP) is a worldclass strategy developed for the achievement of net-zero emissions by 2060 and creating investment opportunities to deepen gas development, as well as the establishment and expansion of industries related to solar energy, hydrogen, and electric vehicles.

On 24th August 2022, H.E Professor Yemi Osibanjo, Vice President of Nigeria, officially launched the Nigeria Energy Transition Plan (ETP), a roadmap that set in motion the country’s pathway toward a just and equitable energy transition with the objectives of achieving net-zero emissions by 2060.

Nigeria seeks to take the leadership role in enabling a just and equitable climate future for Africa, with the ultimate objective of mobilizing the finance required to jumpstart implementation of the Plan.

Speaking at the global virtual launch, Osinbajo revealed that Nigeria would need to spend $410 billion above to deliver its Transition Plan by 2060, which translates to about $10 billion investment per year.

According to him, the Federal Government has established an inter-ministerial Energy Transition Implementation Working Group, which is been chaired by the Vice President, comprising several key ministers, and supported by an Energy Transition Office (ETO).

He said, “We are currently engaging with partners to secure an initial $10 billion support package ahead of COP27 along the lines of the South African Just Energy Transition Partnership announced at COP26 in Glasgow.

“Africa’s increasing energy gaps require collaboration to take ownership of the continent’s transition pathways.”

Specifically, the Nigeria Energy Transition Plan aims to achieve the following objectives:
Significant job opportunities with up to 340k jobs created by 2030 and up to 840k jobs created by 2060 driven mainly by the Power, Cooking, and Transport sectors.

Gas will play a critical role as a transition fuel in Nigeria’s net-zero pathway, particularly in the Power and Cooking sectors.

Significant investment opportunities such as the establishment and expansion of industries related to solar energy, hydrogen, and electric vehicles.

Furthermore, Nigeria’s energy transition requires significant emission reductions in 5 key sectors which include; Power, Transport, Oil and Gas, Cooking, and Industry.

To kickstart the implementation of this bold plan, Nigeria is seeking to raise funds ahead of COP27.

The Government is now working to achieve the following objectives ahead of COP27 in Egypt:
3Secure at least a $10 billion financing commitment to kickstarting the implementation of Nigeria’s Energy Transition Plan by COP27.

Original Equipment Manufacturers (OEMs) to commence local manufacturing/assembly of key technologies such as solar panels, inverters, solar standalone systems, and electric vehicles by 2025.

Implement technical assistance for skill development and knowledge transfer for the deployment of Electric Vehicles (Evs), the establishment of a carbon market,

and the development of a just transition pathway beyond oil and gas.
3Play a leadership role by promoting a just, inclusive, and equitable energy transition in Africa.
3Support a conducive business and investment environment for the energy transition.

Providing more information on energy poverty in Africa, Osibanjo explained: “The current lack of power hurts livelihoods and destroys the dreams of hundreds of millions of young people.

“And Africa’s current unmet energy needs are huge, future demand will be even greater due to expanding populations, urbanization, and movement into the middle class.

“It is clear that the continent must address its energy constraints and would require external support and policy flexibility to deliver this. Unfortunately, in the wider responses to the climate crisis, we are not seeing careful consideration and acknowledgment of Africa’s aspirations.

“We developed our Energy Transition Plan to engage with the rest of the world in a serious, thorough and data-backed manner.”

The launch also featured remarks from Nigerian ministers and officials, including, Ministers of Environment, Mr. Mohammed Abdullahi; Power, Abubakar Aliyu; Works and Housing, Babatunde Fashola; Finance, Budget, and National Planning, Zainab Ahmed; and Managing Director, Rural Electrification Agency, Ahmad Salihijo.

Other speakers included the Minister of Petroleum and Energies from Senegal, Dr. Aissatou Sophie Gladima; Minister of Electricity and Renewable Energy from Egypt, Prof. Dr. Mohamed Shaker El-Markabi as well as representatives of the United Nations, Sustainable Energy for All, World Bank, African Development Bank, IRENA, Rockefeller Foundation, and Global Energy Alliance for People and Planet.

At COP26, H.E. President Muhammadu Buhari announced Nigeria’s commitment to carbon neutrality by 2060. Since the announcement, the Climate Change Act 2021 has been passed, the Energy Transition Plan has been fully approved and launched by the Federal Government of Nigeria.

As part of the government efforts to seek global partnerships and support for Nigeria’s recently launched Energy Transition Plan, Vice President Yemi Osinbajo led a Nigerian delegation to the United States of America to meet with US Vice President, Kamala Harris; US Secretary of Energy, Jennifer Granholm; Secretary of Treasury, Janet Yellen, and President of World Bank Group, David Malpass, among others.

Osinbajo is leading Nigeria’s Energy Transition Implementation Working Group (ETWG), to promote the plan and secure global support from the US government, the private sector, and other development partners.

Nigeria needs $410 billion to deliver the Transition Plan by 2060. Among other highlights, the plan needs at least $10 billion per year above business-as-usual spending for effective implementation.

The World Bank and a renewable energy organization, Sun Africa, pledged $1.5 billion each, totaling an initial $3 billion investment to support the implementation of the Nigeria Energy Transition Plan.