Nigeria Bets on Solar to Create Jobs Post COVID-19 Disruption
The government is planning to install five million solar-home systems and minigrids
September 21, 2020
Nigeria is currently facing one of the most significant economic downturns in its history due to COVID-19. While the country is grappling with a recession, the government has outlined an ‘Economic Sustainability Plan’ in response to the challenges posed by the COVID-19 pandemic.
The plan focuses on several projects and policy approaches, which could lead to job creation across the fields of agriculture and agro-processing, renewable energy, infrastructure, manufacturing, food security, housing construction, and the digital economy.
Among the key projects proposed by the government, the ‘Solar Home Systems Project’ is expected to serve more than 25 million Nigerians who are currently not connected to the national grid. This move by the government will likely help the local solar manufacturers to set up manufacturing facilities of solar components and appliances in Nigeria, thereby creating jobs for the locals. In addition to this, installation, servicing, and payment collections will create more jobs for the locals.
According to the sustainability plan, the solar power strategy will support 250,000 jobs and impact up to 25 million beneficiaries by installing five million solar-home systems and mini-grids. The government is aiming to provide reliable electricity to health clinics and also to rural communities that have little or no access to the national grid. Private sector installers of solar systems will be supported to access low-cost financing from development finance institutions to install solar systems at an affordable price.
The dependence on oil has accentuated the economic condition of the country. With the fall in crude oil prices to $12 (~₹882.2) per barrel in April 2020 and the inability of the country to sell oil, despite it being priced below the production cost, has put the government in a tight spot.
The National Bureau of Statistics has come up with macro scenarios that show that economic growth could fall by nearly 4.40% to 8.91% depending on the impact of the outbreak COVID-19 pandemic, period of lockdowns, and the amount of stimulus deployed by the government.
The ‘Economic Sustainability Plan’ aims to address the effects of the recession while ensuring social stability and addressing long-standing economic vulnerabilities.
Another important program that the government has proposed in the plan is the ‘National Gas Expansion Programme.’ The government aims to accelerate the transition of Nigeria to a post-oil era, promote the domestic use of cleaner fuels, and prepare the compressed natural gas (CNG) market for export opportunities.
The ‘National LPG Expansion Implementation Plan’ will oversee and drive all the efforts undertaken by industry stakeholders to promote LPG consumption in Nigeria. The project will organize the sector to support conversion from traditional fuels like kerosene, wood, etc. to cleaner LPG fuel. The government will work with private players to promote the manufacturing of cylinders and other accessories to foster wider adoption of LPG.
In June this year, All On, an independent impact investment company, had announced the completion of the first phase of nationwide solar installations at Nigerian emergency health facilities related to the COVID-19 pandemic response. The company had announced the formation of a COVID-19 Solar Relief Fund on March 31, 2020, and it was established with help from solar companies like Auxano, GVE, and Lumos. The main aim of the fund is to provide solar power for emergency health facilities in support of the national response to the COVID-19 pandemic.
Recently, the African Union Commission and the International Renewable Energy Agency agreed to work together to promote renewable energy across the African continent and to bolster Africa’s response to the coronavirus outbreak. The two organizations will focus on innovative solutions to drive the development of renewable energy, including decentralized systems, and to increase access to energy across the continent.