Energy
Experts point to Solar, Coal, Hydro power, as gas challenges persist
ABUJA – Gas supply shortages affecting power supply in many parts of the country have reinforced the need for the government to speed up efforts at diversifying the nation’s power generation mix, which is currently largely dependent on gas, analysts have said.
Nigeria’s electricity generation has continued to fluctuate between 2,500 megawatts (MW) and 4,600 MW in recent years, with the failure of the federal government to achieve its planned 10,000 MW by December 2013.
Meanwhile, the country, with a population of about 170 million people, is estimated to need about 40,000 MW of electricity over the next decade, but current generation capacity falls far short of the almost 13,000 MW required to meet current peak demand.
Experts say diversification of the generation mix would help to lift power supply in the nation.
They add that to minimise the current supply challenges being faced with gas supply, other fuel sources such as solar, coal and hydro-power should be fully explored in order to ensure diversified electricity sources that will promote electricity availability and reliability.
The need for more incentives to boost the commercialisation of renewable energy technology in the country as alternative source of electricity supply was identified as critical to facilitating further investments.
“There is no doubt Nigeria needs to diversify its energy resource inputs for power. Gas is better as a peak demand source. Coal serves well as a base-load source. I am an advocate of energy resource mix in the power sector. The use of oil to power generators is ludicrous and a waste of a scarce resource.
“ Nigeria must wake up to that. But if we have to rely on gas as a transition fuel, we must explore more aggressively, but we are not. Neither are we doing much for coal as we should,” said Wumi Iledare, president of the International Association for Energy Economics and director, Emerald Energy Institute, University of Port Harcourt.
Atedo Peterside, chairman of the Technical Committee, National Council on Privatisation, speaking at a conference weeks back, had said that while gas supply constraints arising from capacity shortfalls/lags could be foreseen, the impact of pipeline vandalisation was not so predictable and could induce damaging shocks to the health of the entire electricity value chain.
“It has become increasingly likely that renewable energies will provide more of the world’s electricity than gas-fired power plants by 2016, as its declining cost profile positions it to compete more vigorously with fossil fuels”, says a new report by Ecobank Oil, Gas and Energy Research headed by Rolake Akinkugbe.
According to the report titled ‘Fully charged: Key dynamics in Middle Africa’s Power Sector in 2014’, Ghana is leading the rest of West Africa in driving the renewable energy agenda with its 2011 Renewable Energy Act. The country plans to invest at least $1 billion in renewable energy projects in next 7 years to 2020.
“Costs tend to be high for renewable energy projects in Africa due to equipment imports, higher internal transport costs, import levies. Developing local manufacturing capabilities and increasing the share of local content for renewable power generation projects can help reduce costs, which are predicted to decline over time,” the report said.
Adeola Adenikinju, president of Nigerian Association for Energy Economics and director, Centre for Petroleum, Energy Economics and Law, University of Ibadan, said in the short term, the focus would remain on gas due to a number of economic factors and the relatively shorter term of completing a gas-fired thermal plant.
“However, in the medium term and to avoid or minimise the current challenges we are facing with gas supply, we must be thinking of dual-fuel plants, and other fuel sources both renewable and non-renewable, in order to ensure energy security, a diversified electricity source that will promote electricity availability, reliability and enhance electricity access,” he said.
Adenikinju added that there are currently very limited incentives to boost commercialisation of renewable energy technology as alternative source to electricity supply, citing Germany and China as examples worth studying for Nigeria.
The Ecobank report released on January 30, 2014 stated that the full penetration of renewable energy into the African market would largely hinge on investment security underpinned by regulation.
“Many countries in sub-Saharan Africa have renewable potential that is many times their current demand for electricity, but most private sector executives view national targets and Feed-in-Tariffs as the most powerful incentive mechanisms required to accelerate renewable energy development in the region,” the report said.
Oladiran Ajayi, energy expert and a senior associate with Templars law firm, said considering the relative costs of alternative sources of energy, the nation should pursue them, but not at the expense of gas development.
Last year in August, the federal government signed a $3.7bn memorandum of understanding with a Nigerian-Chinese consortium, HTG-Pacific Energy, for the development of a 1000- to 1200-MW coal-fired power plant in Enugu state. The plant is expected to be operational in the next four years.
Also, in late January the government said it was building over 200 new dams in order to achieve its target of 10,000MW of electricity at the end of this year, according to Vice President Namadi Sambo.
Nigeria, with a population of about 170 million people, is estimated to need about 40,000 MW of electricity over the next decade, but current generation capacity falls far short of the almost 13,000 MW required to meet peak demand.
– BUSINESS DAY
OPEC oil output in May hit its lowest in more than two decades, a Reuters survey found, as a U.S. naval blockade cut Iran’s exports and Iran’s effective closure of the Strait of Hormuz slashed exports by other Gulf producers.
Output by the 11-member Organization of the Petroleum Exporting Countries fell by 1.06 million barrels per day month-on-month to 16.13 million bpd, the survey found.
That was the lowest monthly figure since at least 2000, according to Reuters surveys, and well below the levels seen during the COVID-19 pandemic in 2020 when demand collapsed.
The figures exclude the United Arab Emirates which quit OPEC as of May 1.
ALSO READ: Dangote Foundation Distributes Rice to Cement Host Communities in Ogun
Saudi Arabia had a further decline, although Iraq was able to increase supply due to increased domestic use, sources in the survey said.
Venezuela and Nigeria also pumped more.
Eight members of the OPEC+ producer group, which includes OPEC plus allies including Russia, had agreed to raise production in May, but the Iran war and U.S. blockade made that impossible.
The Reuters survey is based on flow data from financial group LSEG, information from other companies that track flows, such as Kpler, and information provided by sources at oil companies, OPEC and consultants.
Credit – Times of India
Shell Nigeria Gas (SNG) shared its experiences in pioneering gas distribution nearly 30 years ago, and identified the expansion of pipeline natural gas infrastructure and the market‑making role of gas distributors as critical in moving gas from a policy aspiration to a practical energy solution for Nigerian industries.
“When SNG started in Agbara–Ota over 20 years ago, demand was nowhere near what it is today,” recalled Managing Director Ralph Gbobo at a panel session on “Building a Bankable Gas Distribution Ecosystem: Infrastructure, Capital and Market Demand” at the 2nd business forum of the Association of Local Distributors of Gas (ALDG) in Abuja late last week.
Represented by Head, Gas Distribution, Chukwuka Amos-Ejesi, Raph said: “The economics was not perfect, but there was a leap of faith anchored on Nigeria’s industrialisation trajectory. That decision has proven right.”
He said SNG’s persistence proved that when demand ambition, supply certainty, enabling infrastructure, and commercial clarity come together, even if not perfectly at the start, it creates industrial clusters that can grow and attract long-term capital. “Sustainability and bankability emerge over time, as utilization deepens and confidence builds,” he pointed out.
ALSO READ: Africa’s Largest Bank Backs Dangote Refinery’s IPO
The theme of the forum was “From Gas Abundance to Gas Access: Reassessing Nigeria’s Gas Distribution Imperatives,” with industry leaders and other stakeholders discussing the use of gas to drive industrialisation. The panel session agreed on the need for “clear, supportive and credible policy frameworks, especially measures designed to improve the use of gas.
Ralph noted: “The introduction of gas-focused policies, notably the Petroleum Industry Act, marked a turning point. By reinforcing the role of gas in Nigeria’s energy and industrial strategy and embedding instruments such as the Network Code- a critical framework that governs the operations of the Domestic Gas market and ensures transparency and stability, and the Domestic Gas Supply Obligation which compels gas producers to allocate gas to the domestic market, the PIA significantly reduced policy ambiguity around gas development.”
He added: “The introduction of clearer pricing frameworks for gas supply and transportation and a more transparent and competitive licensing regime, has also strengthened market confidence. Together, these measures have improved producer confidence, particularly for domestic gas projects, and signaled the government’s strong commitment to gas as a driver of industrial development.”
Incorporated in 1998 as a fully Shell-owned gas distribution company, SNG currently serves over 150 clients in Abia, Bayelsa, Ogun and Rivers states, partnering with governments and other stakeholders to take the cleaner and more affordable energy to the doorsteps of industries. In the first half of this year alone, the company has connected two additional companies in Ogun State to its gas distribution network.
Photo Caption – L–R: Chairman, Association of Local Distributors of Gas (ALDG), and Managing Director, Axxela Gas Distribution, Kehinde Alabi; and Head of Gas Distribution, Shell Nigeria Gas, Chukwuka Amos-Ejesi, receiving a commendation plaque on behalf of SNG Managing Director, Ralph Gbobo, in recognition of his professional and diligent service on the Governing Board of the Association, at the Association of Local Distributors of Gas (ALDG) Business Forum in Abuja
In what is expected to provide investors and industry stakeholders with a detailed overview of Nigeria’s energy assets and opportunities, her first comprehensive Gas and Power Infrastructure Map will be unveiled at the 25th edition of NOG Energy Week.
It was gathered that the publication, developed by the Gas for Africa programme in partnership with NNPC Limited, will be launched during the annual energy conference in Abuja and is being positioned as a major step towards improving transparency and investment decision-making in Nigeria’s gas and power sectors.
Industry stakeholders have long cited the lack of consolidated and reliable infrastructure data as a major challenge to attracting investment into the sector. The new map seeks to address that gap by providing a single source of information on Nigeria’s gas and power infrastructure, including pipelines, gas processing facilities, power generation assets, LNG terminals and key transmission networks.
ALSO READ: Dangote Refinery Hits 700,000bpd Output, Eyes Global Leadership
Alongside the infrastructure map, organisers will also release a comprehensive report on Nigeria’s gas sector, which they describe as the most extensive industry intelligence publication ever produced on the country’s gas value chain.
The report examines developments in the sector since 2020 and covers key areas such as the NNPC Gas Master Plan 2026, gas reserves and production trends, pipeline infrastructure, capacity challenges, compressed natural gas (CNG), piped natural gas (PNG), liquefied natural gas (LNG) markets, gas-to-power projects and gas-based industrialisation.
According to the organisers, the publication provides an end-to-end assessment of Nigeria’s gas industry and offers critical insights for investors, policymakers and industry operators.
The launch comes at a time when global energy markets are undergoing significant shifts, driven by geopolitical tensions and increasing demand for alternative and secure energy supplies.
Organisers noted that Nigeria is strengthening its position as a major energy player, supported by rising crude oil production, implementation of a new Gas Master Plan and expanding refining capacity.
They said the infrastructure map and accompanying report are expected to help convert investor interest into concrete projects by providing accurate data on existing assets, infrastructure gaps and future opportunities across the sector.
Attendees at NOG Energy Week will be the first to access both publications as government officials, energy executives, investors and industry leaders gather in Abuja for the five-day event.
The conference is also expected to feature investment discussions, joint venture announcements, memorandum of understanding signings and project partnerships aimed at advancing Nigeria’s energy development agenda.
With preparations gathering momentum ahead of the event, organisers said NOG Energy Week 2026 will provide a platform for stakeholders to examine the future of Nigeria’s energy sector and its role in Africa’s broader energy transition and industrial growth.
OPEC Oil Output Lowest Since at Least 2000 as US Blockade Squeezes Iran: Report
Dangote Foundation Distributes Rice to Cement Host Communities in Ogun
US Threatens to Deport Influencers Covering the World Cup for Profit
‘Our Members Are Dying’ — Benue Retirees Protest Unpaid Pensions, Gratuities
Xenophobia Horror: 268 Nigerians Flee South Africa, Arrive Lagos Today
June 12 Showdown: Falana, Falz Lead Nationwide Protest Against Hardship, Insecurity
Trump’s Family Unveils New Cryptocurrency Platform
Senate Denies Receiving Petitions Against Tinubu’s Ambassadorial Nominees
Dangote Cement Lights Up Benue Host Communities With CSR Initiatives
Reps Recommend 3-year Jail Term For Aviation minister
Tems Sets New Record On Billboard Hot 100 Chart
