NIGERIA’s ambition to be a carbon-neutral country while meeting its energy needs by 2060 would be wishful thinking if she fails to incorporate Environmental, Social, and Governance (ESG) principles into her power sector, according to a new report.
“By 2060, Nigeria aims to be a carbon-neutral country while meeting its energy needs. For this goal to be realised, it’s crucial to incorporate Environmental, Social, and Governance (ESG) principles into the nation’s power sector,” the report entitled: ‘Nigeria’s Power Sector ESG Series,’ has said.
The country signed her commitment to environmental sustainability at the 26th Conference of the Parties (COP26), where former President Muhammadu Buhari announced the country’s goal of achieving energy access by 2030 and carbon neutrality by 2060.
COP26 was the 26th United Nations Climate Change conference, held at the SDEC Centre in Glasgow, Scotland, United Kingdom, in partnership with Italy, from November 1-12, 2021. And Nigeria rode on COP26 to commit itself to becoming a carbon-neutral country while meeting its energy needs.
The report authored by Energy & Utilities, a multi-media platform that provides business intelligence, shed light on Nigeria’s endowment of natural resources and securing environmental sustainability in its power sector.
The report underscored the importance of ESG to evaluating a company’s governance mechanisms and how well it manages its environmental and social impacts.
It said ESG encompasses three main things.
The environmental criteria focus on the entity’s stewardship of the natural environment while the social criteria, on the other hand, assess its impact on people. The governance criteria which is the third examines leadership oversight, transparency, and board diversity and independence, among others.
The report said starting this year, Nigerian companies are now needed to undertake ESG reporting, according to the International Financial Reporting Standards (IFRS). “For the power sector, this will help improve transparency, reduce risk, and track the progress towards sustainability goals,” it stated.
The report said Nigeria, Africa’s largest economy and oil producer, is beset with paralytic power problem, with recent estimates from the International Energy Agency (IEA) showing that 140 million people lack access to energy, representing 71 per cent of her total population estimated at over 230million.
The report however, said the challenge goes beyond just closing this energy gap, citing the IEA, which said the country’s energy mix reveals a heavy reliance on biofuels and waste, accounting for 74.5 per cent of its total energy supply as of 2021.
This is followed by oil at 14 per cent, natural gas at 10.1 per cent, and coal at 0.9 per cent. “This heavy dependence on non-renewable sources has led to substantial CO2 emissions, totaling 101 million tons in 2021.
“This represents 0.3 per cent of global emissions and a 128 per cent increase since 2000. These figures confirm that the need to tap into renewable energy sources is but an urgent necessity,” the report stated.
It, however, said despite these challenges, Nigeria, on the brighter side, holds significant potential for clean energy development.
“Nigeria is endowed with plenty of resources that can be used to advance its energy transition and secure environmental sustainability in its power sector,” the report said.
Energy mix
It noted, for instance, that solar energy, considered the most plentiful energy source on the planet, has high potential in tropical countries like Nigeria.
Research shows that key cities like Kano, Onitsha, and Lagos have high levels of sunlight available for conversion to electricity: 6.08, 4.43, and 4.42 kWh/m² per day, respectively.
Wind energy also looks promising in Nigeria. In places like Enugu, Owerri, and Onitsha, wind speeds have been measured at 5.42, 3.36, and 3.59 meters per second, respectively.
In particular, the wind speed in Enugu is high enough to generate electricity effectively, according to wind power standards.
Also, Nigeria’s vast mineral resources, including lithium, are also worthy of attention. Lithium is crucial for clean energy technologies (think of lithium-ion batteries, which are beneficial for renewable energy storage).
Nigeria boasts lithium ores in the Pan-African Basement Complex. Although mining is minimal, significant deposits have been found in Kwara, Ekiti, Ogun, Nasarawa, and Plateau states.
The report noted that with the Nigeria Energy Transition Plan as a guide, various policies and programs are being introduced to make clean and affordable energy available to all citizens.
It said for Nigeria’s power sector — one of the five major sectors tackled by the plan — Nigeria plans to transition away from diesel and petrol generators, which supply most of the country’s power.
Initially, the country will expand its gas generation capacity to meet the increasing demand for electricity and support the integration of renewable energy sources.
Nigeria aims to ramp up the use of renewable energy to enhance electrification and reduce carbon emissions in various sectors, including buildings, industry, and transportation.
Place of partnerships
The report said in support of these efforts, several partnerships have also emerged. For instance, RMI and the Global Energy Alliance for People and Planet (GEAPP) have recently revealed a plan showing that Nigeria would gain over 20 gigawatts of energy in the next 10 years by rapidly expanding renewable energy and battery systems.
