Nigeria  Pushes for 5% Renewable Energy Compliance by Distribution Companies Amid Power Sector Challenges

The federal government on Monday, has moved to ramp up the deployment of renewable energy in the country, urging electricity Distribution Companies (Discos) to adhere to the 5 per cent clean energy requirement as released in a recent order by the Nigerian Electricity Regulatory Commission (NERC).

Speaking in Abuja at a national summit on “Accelerated Scale-up of Renewable and Distributed Energy Resources in Nigeria,” the Minister of Power, Adebayo Adelabu, explained that there was the need to identify, derisk, and deploy renewable and distributed energy projects nationwide.

Adelabu stated that the federal government’s existing policies and action plans such as the National Renewable Energy Action Plan (NREAP), Nigeria Energy Transition Plan (NETP), and the Nationally Determined Contribution (NDC) targets were a clear manifestation of Nigeria’s commitment to developing renewable energy.

He urged the summit to highlight the strategies, regulations and bankable financing arrangements that can be leveraged to deliver Nigeria’s targeted 30 gigawatts (GW) of power supply capacity by 2030 of which 30 per cent is from renewable energy.

“To demonstrate the significance and urgency of incorporating renewable energy in the Nigerian power supply mix, the regulator recently issued and order for the successor discos to procure a minimum of 5 per cent of their respective current energy off-take volume as embedded/distributed generation from renewable energy sources.

“We expect this to be a clarion call for all stakeholders to embraces the government’s effort to improve renewable energy penetration in the system. It is disheartening that for decades, Nigerians have been grappling with the challenges of unreliable grid supply with frequent power outages and load shedding severely impacting businesses, industries, and households.

“The lack of grid reliability has hampered economic productivity and deters foreign investment thereby exacerbating unemployment and economic stagnation. We are determined to end that,” he stated.

The minister explained that the instruction from President Bola Tinubu was to deliver sustainable, reliable, cost-effective, and climate friendly energy supply for all Nigerians.

Since taking office, he stated that the federal government had made strategic interventions in the electricity value chain with the aim of unlocking stranded capacity and improving the liquidity of the industry.

“Some of these initiatives are centred around facilitating investments in the renewable segment of the industry through the launching of a $500 million initiative by the Nigeria Sovereign Investment Authority’s Renewables Investment Platform for Limitless Energy (RIPLE) programme.

“RIPLE is dedicated to the development, investment, and operation of renewable energy projects across the entire value chain.

“Another significant investment catalysed into the sector is the World Bank’s Distributed Access through Renewable Energy Scale-up (DARES) $750 million facility aimed at addressing infrastructure gaps, expanding access to electricity, and promoting sustainable and inclusive development throughout the country,” he stated.

Adelabu noted that reducing Discos’ inefficiencies in billing and collection through massive investment in metering via the World Bank’s Distribution Support Recovery Programme was expected to support the deployment of 1.5 million meters into the sector and the Presidential Metering Initiative (PMI) which is expected to support the annual deployment of 2 million meters.

He also highlighted the payment of legacy gas debt to gas companies to foster greater market discipline and enforce the sanctity of contracts.

The minister stated that the federal government was also improving the grid’s transmission evacuation capacity through the ongoing Presidential Power Initiative (PPI), which has, thus far, increased transmission capacity by 463mw.

He said the administration also supported the continual expansion of sustainable on-grid generation capacity with the commissioning and operationalisation of the 700mw Zungeru hydropower plant.

“Despite the challenges we face, we are committed to sustaining efforts to deriskrenewable energy generation through the programmes such as the Interconnected Mini-Grid Acceleration Scheme (IMAS), with technical support from EU and the German government, which is expected to catalyse the deployment of 23 mini-grids across 11 states of the federation to serve over 138,000 Nigerians,” he stressed.

Also speaking, the Chairman of NERC, Sanusi Garba, said the renewables scale-up programme was fully aligned with the president’s agenda on sustainable power sector.

With a lot of sunshine and other renewable sources of energy, including wind, he said distributed energy sources were very important in the context of the fragility of the national grid and also the need to ensure that rural communities are expeditiously connected to local sources of electricity.

The overarching goal, he said, is the provision of services to Nigeria, stressing that NERC was concerned with the development of an efficient electricity market and the establishment of a regulatory framework that promotes rapid investments.

Garba said that NERC had recently worked on a performance improvement plan as a means of optimising investments in the power sector, urging investors to take advantage of the opportunities in renewables and distributed generation in Nigeria. 

In this regard, this summit, he said, is expected to grow from the various experiences of stakeholders and developing partner institutions in exploring the most suitable avenues to deliver projects sustainably.

“Although challenges in the power sector have been multifaceted and persistent, we are confident of our strong resolve to innovate and utilise all tools at our disposal to overcome these issues,” he stressed.

Others who spoke at the two-day event were the leader of the EU delegation, Godfrey Ogbemudia; Representative of the National Assembly Committee on Power, EyinnayaAbaribe, Tony Ani as well as the Commissioner, Planning, Research and Strategy, NERC, Dr. Yusuf Ali, among others.

Emmanuel Addeh

Follow us on: