Power: Adelabu Calls For Increased Investments To Unlock Sector Potential
By Sunday Etuka, Abuja
The Minister of Power, Chief Adebayo Adelabu has called for increased investments in Nigeria’s gas development to unlock the full potential of the power sector and achieve the Nigeria Energy Transition Plan.
Adelabu made the call On Tuesday while giving his Ministerial Address on a topic: “Navigating Nigeria’s Pathway To Achieving Energy Security Sustainably On The Journey To Net Zero”, at the Nigeria Oil and Gas (NOG) 2024 Energy Week on Tuesday in Abuja.
He explained that “the domestic gas-power market accounts for 60% (approx. 700 MMSCF Daily) of the total domestic gas supply. This gas quantity currently sustains Nigeria’s 4GW average grid generation capacity.
“In line with the Nigeria Energy Transition Plan vision 30:30, which seeks to achieve 30GW by the year 2030, our energy mix is projected to be 70% (or 21GW) thermal source (most likely gas considering the country’s gas potential) and 30% (or 9GW) renewable source.
“The power sector would require over five times what the industry currently utilises from the domestic gas market to achieve our 70% thermal energy target with gas-powered generation.
“Additional investments would be needed to increase the country’s gas production to achieve this level of gas supply to the power sector without compromising the export obligations.
“To this end, I call on the investors here today to strongly consider the investment in the further development of gas production in the country, especially our abundant unexploited Non-Associated Gas reserves”, he said
The Minister stated that in recognition of the need for adequate liquidity in the power sector to catalyse the much-needed investments across the value chain, the Federal Government recently introduced a cost-reflective tariff for the sector’s most served grid-tied customer segment.
In addition, he said, the presidential approval was granted to resolve the power sector obligations to defray legacy debts to generation and gas companies.
These actions, according to him, speak to the government’s commitment to allowing efficient gas supply for the Nigerian power sector and ensuring there’s a clear line of sight for investors to recoup their investments in the country.
While stating “the Federal Government’s commitment to ensuring a viable and bankable power sector, Adelabu declared that the industry is investment-ready.
He, therefore, urged both local and foreign investors to consider the significant benefits of investing in renewable energy projects in Nigeria, so as to achieve the nation’s 30% Renewable Energy target.
“Our country boasts abundant resources, particularly solar, wind, and hydro energy, providing a remarkable opportunity for sustainable growth”, the Power Minister said.
He stated that the renewable energy market has grown tremendously in the last decade, with over $1 billion leveraged by Multilateral Development Banks.
“By channeling investments into these renewable sources, we can effectively meet our carbon emission targets while playing a crucial role in combating climate change.
“As demonstrated by our recently completed $550 million Nigeria Electrification Project, investing in renewable energy helps reduce carbon emissions, enhance energy security, and support economic development.
“Additionally, to complement the NEP, the $750 million DARES project would provide electricity to 2.5 million people in Nigeria by deploying solar home systems and mini-grids.
“These investments will propel Nigeria toward achieving its desired energy mix and transition targets”, he noted.
While calling on industry stakeholders to join hands in charting Nigeria’s course towards sustainable energy security and robust economic development, the Minister reaffirmed the administration’s
unwavering commitment to achieving net zero emissions by 2060.
