Net-Zero: Energy price surge and Nigeria’s green ambitions

PHOTO

In recent years, the pursuit of clean and sustainable energy has attracted global attention considering its immense impact on climate change mitigation, as there is a growing consensus that the availability and use of clean energy are key to climate change action and the achievement of environmental sustainability. This has led to the United Nations Framework Convention on Climate Change (UNFCCC), which calls for a universal effort to curb global carbon emissions due to its growing impact on global warming and the attendant and unprecedented environmental and public health consequences. In sync with this, Nigeria, like many other countries, has shown renewed and realistic commitment to the transition to green energy sources by 2050, as evident in the drive to ensure millions of Nigerian households adopt liquefied petroleum gas (LPG) (commonly known as cooking gas) as their primary source of cooking energy. Hence, it is commonplace to believe that this ambitious target is fueled by the government’s desire to achieve net-zero carbon emissions by 2050, in line with global action against climate change and its devastating public and environmental health repercussions.

Consequently, the Nigerian government in recent years has reeled out laudable and strategic measures and policy plans to ensure a timely transition to a green economy, notable among which include, but are not limited to, the Climate Change Act of 2021, which seeks to achieve low-carbon emissions and sustainable development by providing the structure to set a target to reach net zero between 2050 and 2070 under the 2015 Paris Climate Agreement signed by 190 countries with Nigeria as a signatory. Similarly, Nigeria’s Energy Transition Plan, released in August 2022, seeks to serve as an avenue towards achieving the 2060 net zero target, together with the National Gas Policy Plan, which, among other measures, prioritized the promotion of LPG and aimed to deepen the consumption of LPG across the diverse socio-economic divide in light of its low carbon emissions and key to achieving the green energy initiatives.

Related PostsBritain to ban new petrol cars by 2030 to net-zero emissions

However, while these courageous drives are worthy of commendations, recent socio-economic situations in the country and its citizenry threaten to undermine the realization of the country’s green energy vision, with about 133 million Nigerians reported to be multi-dimensionally poor, according to the recent National Multidimensional Poverty Index Report by the National Bureau of Statistics. This is further compounded by the recent turn of events in the country’s energy price surge that has left many Nigerians incapacitated regarding the affordability of essential energy products. Notably, the recent removal of subsidies on fuel, along with the recent rise in electricity tariffs and consistent increase in gas prices, have left deep and widespread consequences in their wake, including both socio-economic, environmental, and public health consequences, occasioned by the shift to traditional and high-carbon energy sources because of affordability. This analysis delves into the interconnected but complex web of implications from Nigeria’s energy price hikes on the progress towards the mitigation pledges under the Paris Climate Agreement, as affordability is becoming increasingly recognized as the best policy option to demonstrate progress towards the mitigation pledges under the Paris Climate Agreement and the realization of national green energy plans.

First, domestic use of LPG remains the major driving force in the achievement of green energy initiatives as well as the achievement of the Nigerian Gas Master Plan, owing to its increasing population growth and the concomitant rising energy needs for domestic cooking, which account for about 80% of Nigeria’s household energy demands. Regrettably, recent reports making the rounds show that after a few months of relative decrease or will I say stability in the refill rate of LPG in the country, a kilogram of LPG is presently selling at N1000/kg, and there are indications that the price of cooking gas may rise by 80% by December 2023, that is, N1500/kg, which is equivalent of N18,000 for 12.5kg. This portends a serious threat to the country’s climate change action plans, as the majority of the low-income earners will be turning as usual to firewood and charcoal as cheap alternatives sources of energy, with a dire consequence on climate change, through the looming increase in deforestation, as more woods will be felled for fuel and charcoal to meet up with the expected rise in energy demands. For instance, the Food and Agriculture Organization’s most recent statistics reveal that Nigeria has the highest rate of deforestation in the world, and Global Forest Watch estimates that Nigeria has lost nearly 105 kha of natural forest, which is equal to 69.7 metric tons of CO2 emissions in 2022. That is because one of the most indispensable benefits of forests is their carbon uptake ability, which helps in the removal of atmospheric CO2, a major greenhouse gas contributing to global warming. The situation is further compounded as the rate of deforestation is not habitually matched by the rate of reforestation, thus encouraging desertification, erosion, and global warming due to a lack of carbon sequestration.

Moreover, though several measures have been put in place to curtail the gruesome situation of deforestation in the country, these so far have failed to address the situation. For example, in 2014, the National Environmental (Control of Charcoal Production Export) Regulation was enacted to regulate and control charcoal production, which comes from deforestation. Also, the Reducing Emissions from Deforestation and Forest Degradation (REDD+) policy was introduced to address the issue of deforestation in the country in recognition of its overarching importance in climate change mitigation and control. Despite these, as exemplified by reports, the rate of deforestation has consistently increased unabated, which could be attributed to the persistent over-reliance of many Nigerians on fuel wood and charcoal, which account for over 60% of the most popular domestic cooking energy. Sadly, a recent report by Energy Economics on how households respond to energy price increases shows a significant shift by households towards the consumption of huge amounts of charcoal, which underscores the need to ensure the availability and affordability of LPG across the country.

Furthermore, expanding the availability of gas across Nigeria will be inconsistent with achieving net zero emissions by 2050 if the products are not readily affordable by the majority of the country’s rural poor, who constitute about 80% of the country’s population. To substantiate this, a recent LPG survey reported in the International Journal of Advances in Engineering and Management revealed that up to 69% of non-users in the country will become users of LPG with increased affordability and availability of the product, which goes to show the government can achieve their energy transition goals by regulating gas prices to ensure affordability. It has also been observed that aligning energy prices with mitigation drives is fundamental to achieving green energy initiatives. This could be explained from the economic point of view that availability usually does not always translate to adoption and affordability, as LPG consumers, like every other consumer, are sensitive to price, a situation that is already threatening the very fabric of the National Gas policy plan and the inherent drive to cut carbon emissions and consolidate sustainable energy practices among millions of Nigerian households as part of our Sustainable Development Goals, which seek to ensure access to affordable and clean energy by 2030.

In addition, with the recent reversal of fuel subsidization and the resulting hike in fuel prices, millions of Nigerians are compelled by their financial circumstances to resort to more affordable but environmentally unfriendly sources, most concerningly firewood and charcoal, which are seen as cheaper alternatives. This constitutes a persistent drawback in the realization of the much-needed transition from traditional energy to cleaner and modern energy sources since fossil fuels are known for their high carbon emissions, which are implicated as the leading cause of global warming. For example, it has been observed that an increase in the price of petroleum products in Nigeria is proportionally associated with an increase in the deforestation rate, according to a report published by the Journal of Energy, Environmental, and Chemical Engineering.

However, while subsidy removal might present long-term economic benefits, evidence suggests it could potentially pose a setback to the shift to clean energy and delay progress towards a carbon-free economy by 2050. The research literature on Nigeria’s fuel subsidy reforms documented that subsidy removal can cause a transition in energy consumption patterns and, in this light, a shift to more affordable traditional carbon-intensive energy sources, often seen as cheaper alternatives, with potential climate change risk occasioned by high carbon emissions and increased deforestation. Also, while studies have reported that subsidy removal leads to a decline in emissions, thus facilitating progress towards climate change mitigation, it is worthy of note that such an impact may be transient, as stability in price could still drive up overall demands. On the flip side, literature has observed the long-term impact of subsidy removal on the shift to carbon-laden energy sources such as fuel wood and its tripartite impact, as demonstrated in the increased rate of deforestation leading to unsustainable forests and a reduction in the capacity of the forest to absorb CO2, as millions of low-income population migrate to the traditional fuel wood and charcoal. This could be seen as a potential long-term impact, as it takes years for forests to regenerate to their sequestration capacity. Similarly, recent evidence on the impact of fossil fuel subsidy removal in developing countries published by the Journal of the Association of Environmental and Resource Economists indicated that households’ use of modern energy decreases, with a corresponding increase in the use of traditional fuels (e.g., fuel wood and charcoal) following a price surge.

More so, while the opportunity for electric cooking is high, a report shows that 3.5 million households have the potential to use electric cooking. However, less than 1% of Nigerian households use electricity as their primary cooking energy, illustrating limited access to electricity and the risk of an exorbitant electricity tariff, as such a billing rate is financially unsustainable, and very few can afford to sustain routine domestic electric cooking at such a price, as others turned to high-carbon energy cooking sources, which are environmentally unsustainable, indicating the need for regular and affordable electricity to promote household use of clean energy in furtherance of the nation’s clean energy drive.

In closing, it is apparent that the implications of the sudden energy price surge extend beyond the immediate economic concerns, as it also hinders the country’s ability to realize its global and national climate efforts and green energy goals, because when the affordability of clean energies becomes financially difficult, the nation risks missing out on the broad goal of green energy transition, improved public health, and environmental sustainability. However, with the current trio of price hikes in fuel, electricity, and currently LPG, coupled with the country’s existential socio-economic ordeal, it seems like Nigeria may be moving towards its worst energy poverty, with grave consequences for deforestation and the global climate change debacle. That is because the continued over-reliance of the majority of Nigerians on wood-based energy (mostly fuelwood and charcoal) to meet their cooking needs will further deepen the divide in the country’s sustainable energy drive if not given prompt and the needed attention it deserves, and may cost even more to exit without steady external interventions and support.

Equally, with commitments at the COP26 to halt deforestation by 2030, it becomes expedient that this ugly trend needs addressing soon rather than later, by addressing the root cause through increase in accessibility to affordable domestic cooking gas and electricity for millions of Nigerians who depend on fuel wood and charcoal as primary source of cooking energy, if we are to achieve the sustainable energy targets with an overall improvement in environmental and public health. This underscores the need for incentives to promote and encourage the adoption and routine use of clean energy to facilitate a rapid and holistic shift to modern cooking energy sources, a move that will ensure not just economic prosperity for the country, but also the much-needed environmental sustainability by achieving the net-zero target. Hence, additional policy tools, most significantly on regulation and price control and community mobilization on green energy consumption, are suggested to make clean energy options readily accessible and affordable for all, thus ensuring regular and long-term utilization of modern and environmentally friendly energy sources across the diverse socio-economic class to facilitate and sustain Nigeria’s green energy ambitions.

Edet Otto is a PhD student of Environmental Health Science at Kwara State University and a lecturer in the Department of Environmental Health Science, at Ajayi Crowther University, Oyo.

Note: This article is (without any alteration to its original form) completely an opinion of the writer and does not convey or represent the thoughts of, or a shared belief with NIGERIAN TRIBUNE.