1 week Ago By Kingsley Ighomwenghian
LAGOS – Experts, on Thursday, in Lagos, concluded that with just five years to 2030, the target set by President Bola Tinubu for the size of Nigeria’s economy to hit $1 trillion is unrealistic based on realities on ground, one of which is energy security. Ahead of that target, the Central Bank of Nigeria (CBN), last November, directed the nation’s banks to raise their capital, a situation that has spiked recapitalisation exercises by some of the country’s banks since March. According to the Securities & Ex-change Commission (SEC), the banks have so far scooped N2.
7 trillion from the capital market through public offers and right issues to existing shareholders. From the current 5,500 megawatts, the Nigerian Electricity Supply Industry (NESI) in its vision 30:30:30 said that the country’s output could reach 30,000mw by 2030, 30 percent of which will come from renewable energy. Speaking on Thursday at the 2025 Bullion Lecture with the theme, ‘Architecting the Energy Sector for Nigeria’s $1 trillion Economy,’ organised by the Centre for Financial Journalism, the experts agreed that the government must chart a clear pathway for achieving the vision so that it does not end up like several others before it.
In his keynote titled, ‘Nigeria in the global energy transition era’, former Power Minister, Prof. Barth Nnaji, urged the country to scale up to 100,000mw capacity which will catapult it to a higher medium power economy by 2040. The structure to enable it achieve the target, he said, must be put in place, lamenting that the country stopped investing in power generation 10 years ago, as no new power plant has been commissioned since 2015 and no fresh power purchase agreement has been signed also.
In contrast, he challenged all to check how much of electricity China, the world’s second largest economy, generated three or two years ago and even last year to understand the danger facing Nigeria’s target of expanding her economy. Nnaji expressed doubt “that the country can generate either 30,000mw by 2030 as envisaged by the NESI, or 100,000mw by 2040, as I advocate.” This, he blamed on the suspension of the guarantee instrument for Power Purchase Agreement (PPAs) by the administration of former President Muhammadu Buhari, and that without new PPAs, no new power plants will be built.
Already, he continued, the ExxonMobil Power Plant, OMA Power by the Joint Venture of Geometric Power, General Electric and others remain in abeyance, adding that at the cost of $1.5 million per MW, no investor will build any plant without at least a Partial Risk Guarantee (PRG). Government, the ex-minister continued, “must do something to make 24-hour power supply happen and achieve the desired power adequacy of over 100,000mw.
It is inexplicable, he continued, that with 209.26 trillion cubic feet of gas, which makes her the 9th country with the highest natural gas deposit in the world, “Nigeria should be struggling with gas for the 24 gas-fired plants, with over 80 million persons with no electricity access.” This, he said, is in contrast to Algeria with just 2.
9 trillion cubic feet that has long provided electricity access to all its citizens and built very good educational institutions, including an internationally recognised technical university, besides being one of Africa’s three largest economies, ahead of Nigeria at number four. The government, he stressed, must stop gas flaring, he said, just as it must prioritise domestic gas consumption, while trying to earn foreign exchange by exporting gas to Europe through North Africa. In his own submission, Dr.
Ogho Okiti, a discussant and Chief Executive Officer of ThinkBusiness Africa, warned that achieving the $1 trillion target will not be by wishful thinking, or happenstance, drawing inference from other economies that have grown their economies significantly over the years to the levels they are today. Judging by the latest GDP rebasing exercise, whose result is yet to be released, there are extrapolations that Nigeria’s economy could be as big as $490 billion going by estimates. This, he continued, means there is a gap of $510 billion to achieve the target, warning that at the current growth rate of about three percent, it could take Nigeria up to 24 years to achieve the target.
Should the country succeed in growing by 10 percent, it would take 7.5 years. In her opening remarks, Mrs.
Tolulope Longe, National President, Women in Energy, Oil and Gas, challenged the country to design an energy transition that reflects Nigerian realities, not the foreign road-map, stressing the need to build a radical energy infrastructure through modernising the sector. According to her, “We need to unleash Nigeria’s gas renaissance. Policy clarity should be prioritised as well as harmonised in this sector and investors’ confidence should be built.
“Bureaucracy should not be the bottleneck to our N1 trillion economy, and we should remember that women and youths are the energy force here”..
