Regulation & Policy

National Renewable Energy and Energy Efficiency Policy (2015)

National Renewable Energy and Energy Efficiency Policy (NREEEP) was developed by the Federal Ministry of Power in 2013/14 and was approved by the Federal Executive Council in May 2015. NREEEP seeks to bring to the attention of policymakers the economic, political and social potential of renewable energy. The document also stipulates that existing policies lack a coherent and all encompassing framework that drives the sector and therefore calls for an integrated renewable energy and energy efficiency policy which will serve as a useful vehicle that limits conflicts in the future and promotes development and deployment of renewable energy technologies in Nigeria. It can be regarded as an umbrella document consolidating the various other policies and strategies in one document.

This policy, which will presumably replace the REMP, encourages the development of a national renewable energy action plan and a national energy efficiency action plan which will facilitate the overall achievement of the objectives it sets out. As per its objectives, the NREEEP declares that the proportion of Nigeria’s electricity generated from renewable energy sources shall increase to a level that meets or exceeds the ECOWAS regional policy targets for renewable electricity generation and energy efficiency for 2020 and beyond.

Feed-in Tariff for Renewable Energy Sourced Electricity (2015)

The Government of Nigeria approved this new feed-in tariff regulation in November 2015. The regulation entered into force in February 2016 and supersedes Multi-Year Tariff Order (MYTO) II (2012-2017). Aiming to make use of Nigeria’s vast and mostly untapped potential for renewable energy, the intent is to stimulate investment in the sector. By 2020, a total of 2,000 MW shall be generated through renewables like biomass, small hydro, wind and solar.

According to the regulation, the electricity distribution companies (Discos) will be obliged to source at least 50% of their total procurement from renewables. The remaining 50% was set to be sourced from the Nigerian Bulk Electricity Trading Company (NBET). Moreover, a distinction was made between small and large generation plants. While electricity procured from small plants (between 1 MW and 30 MW) will automatically be integrated as renewable energy, the Nigerian Electricity Regulatory Commission (NERC) will initiate a competitive bid process for larger renewable energy projects (more than 30 MW).

Nigeria’s Intended Nationally Determined Contribution (2015)

Nigeria submitted its Intended Nationally Determined Contributions (INDC), approved by President Muhammadu Buhari, to the UNFCCC on November 28, 2015 ahead of the Paris UN Climate Change conference, widely known as COP 21. Under a business-as-usual growth scenario, consistent with strong economic growth of 5% per year, the following targets were set:

  • An unconditional contribution to reduce GHG emissions 20% below BAU projections by 2030
  • Conditional on external support, Nigeria will reduce GHG emissions 45% below BAU projections by 2030.

Nigeria’s INDC demonstrates its determination to grow its economy sustainably while reducing carbon pollution. Key measures to achieve the targets include:

  • Work towards ending gas flaring by 2030
  • Work towards Off-grid solar PV of 13GW (13,000MW)
  • Efficient gas generators
  • 2% per year energy efficiency (30% by 2030)
  • Transport shift car to bus
  • Improve electricity grid
  • Climate smart agriculture and reforestation

National Policy on Climate Change (2013)

The National Policy on Climate Change is a strategic policy response to climate change that aims to foster low-carbon, high growth economic development path and build a climate-resilient society through the attainment of set targets. The plan explicitly identifies climate change as one of the major threats to economic development goals and food security. To meet these challenges, the plan includes concrete targets in the areas of climate change adaptation, afforestation, and energy supply. The vision of the National Climate Change Policy Response and Strategy (NCCPRS) is a climate change-resilient Nigeria ready for rapid and sustainable socio-economic development. Its main objectives are:

  • Implement mitigation measures that will promote low carbon as well as sustainable and high economic growth;
  • Strengthen national capacity to adapt to climate change;
  • Raise climate change-related science, technology and R&D to a new level that will enable the country to better participate in international scientific and technological co-operation on climate change;
  • Significantly increase public awareness and involve the private sector in addressing the challenges of climate change;
  • Strengthen national institutions and mechanisms (policy, legislative and economic) to establish a suitable and functional framework for climate change Governance.

National Adaptation Strategy and Plan of Action on Climate Change (2012)

As Nigeria’s climate is already changing, the Government of Nigeria acknowledges the importance of developing a national response to climate change, and thus embarked upon the development of National Adaptation Strategy and Plan of Action on Climate Change for Nigeria (NASPA-CNN). The objective of the policy is to reduce the impacts of climate change through adaptation measures that can be undertaken by the Federal, State and Local Governments, civil society, private sector, communities and individuals, including measures that will:

  • Improve awareness and preparedness for climate change impacts
  • Mobilize communities for climate change adaptation actions
  • Reduce the impacts of climate change on key sectors and vulnerable communities
  • Integrate climate change adaptation into national, sectoral, State and Local Government planning and into the plans of universities, research and educational organizations, civil society organizations, the private sector and the media.

Renewable Energy Master Plan (2012)

The Renewable Energy Master Plan (REMP), drafted by the Energy Commission of Nigeria and the United Nations Development Programme (UNDP) in 2005 and reviewed in 2012, expresses Nigeria’s vision and sets out a road map for increasing the role of renewable energy in achieving sustainable development.

The REMP seeks to increase the supply of renewable electricity from 13% of total electricity generation in 2015 to 23% in 2025 and 36% by 2030. Renewable electricity would then account for 10% of Nigerian total energy consumption by 2025. The Plan also encompasses installed capacity targets for a set of suitable renewable energies, declining as follows:

  • Small-hydro: 600 MW in 2015 and 2, 000 MW by 2025;
  • Solar PV: 500 MW by 2025;
  • Biomass-based power plants: 50 MW in 2015 and 400 MW by 2025;
  • Wind: 40 MW for wind energy by 2025;

Simultaneously to this increase in power supply from renewable energy sources, the REMP targets higher electrification rates, from 42% in 2005 to 60% in 2015 and 75% by 2025. The REMP also implements a set of fiscal and market incentives to support RE deployment. On the short term, the plan includes a moratorium on import duties for renewable energy technologies. On the longer run, the plan advises the design of further tax credits, capital incentives and preferential loan opportunities for renewable energy projects. However, in this context it is important to note that the REMP has still not been signed off by the government or formulated into a law governing the renewable energy development.

Vision 20:2020 (2010)

The Vision 20:2020 as released at the end of 2010 outlines the path for the global and national vision to position the country among the leading 20 economies of the world in 2020 and aims at a holistic transformation of the economy. Vision 2020 recognizes the importance of Nigeria’s renewable energy resource potential in meeting national electricity targets. Therefore, it called for various measures and strategies as contained in the document to support the sustainable integration of renewable energy generated electricity into the energy mix of the country. Vision 2020 also aims to reduce the impact of climate change on development processes and the environment. Some of the goals highlighted in the document include:

  • Achieving a 15% and 20% contribution of hydropower to the nation’s electricity generation mix by 2015 and 2020 respectively;
  • Ensuring a 1% contribution of wind energy to the nation’s electricity generation mix by 2020;
  • Attaining a 1% contribution of solar energy to the nation’s electricity generation mix by 2020;
  • Replacing 50% of firewood consumption for cooking with biomass energy technology by 2020;
  • Putting in place an power generation capacity of 1,000MW using biomass resource;
  • Maintaining a biofuel blend not exceeding 10% in transport fuels by 2020 using locally produced renewable biofuels from secondary biomass;
  • Increase forest cover from 6% to 10%;
  • Reduce losses and impacts due to floods and drought by 10% by 2013

National Biofuel Policy and Incentives (2007)

This policy aims to help develop the biofuel industry in order to gradually reduce the dependence on imported gasoline, reduce GHG emissions while promoting economic development. Concrete measures include the introduction of a biofuel blend (10% ethanol) and various measures aimed at stimulating market demand for biofuels and promoting their production (e.g. tax exemptions). The policy includes the establishment of a Biofuel Energy Commission and Biofuel Research Agency and a target that by 2020 100% of biofuels consumed in the country will come from domestic production.

Although the policy seems to be in force, no information is available as to the extent to which it has been implemented and whether adjustments have been made to it in light of experiences gained with the first steps and after feedback from players in the agricultural and petroleum sub sectors. The major player, NNPC performed feasibility studies on ethanol production as well as cassava and palm-oil-based products but only mentions a few projects and initiatives on its website. It can be concluded that the topic gained most interest during the peak years 2009-2012 of the global move towards biofuels but lost momentum after this source was largely criticized for its conflicting use of foodstuff and agricultural land for the cultivation thereof.

Renewable Energy Policy Guidelines (2006)

The Policy Guidelines on Renewable Electricity, issued by the Federal Ministry of Power and Steel, is the federal government’s overarching policy on all electricity derived from renewable energy sources. The Policy Guidelines sets out the federal government’s vision, policies and objectives for promoting renewable energy in the power sector. The document stipulated that the federal government would expand the market for renewable electricity to at least 5% of total electricity generation and a minimum of 5 TWh of electric power production by 2016.

The same year REPG was issued, the Renewable Electricity Action Programme (REAP) which sets out a roadmap for implementing this policy was produced. However, the programme seems to be abandoned with the restructuring of the Ministry of Power and Steel to the new Ministry of Power.