LATEST UPDATES
Card-image-cap

Economy | Power & Energy

Energy Poverty in Nigeria – Prevalence, Human Development and Public Policy Options

Jun 28, 2022   •   by   •   Source: FDC Ltd   •   eye-icon 1037 views

In 2015, United Nations General Assembly (UN-GA) approved a set of 17 ambitious goals, known as Sustainable Development Goals (SDGs), intended to serve as a "blueprint to achieve a better and more sustainable future for all"¹. Goal 7 of the SDG aims to "ensure access to affordable, reliable, sustainable and modern energy for all”². Energy is the lifeblood of all contemporary economies. From households to businesses, communications, education, infrastructure, technology and industrial developments, energy is sine quo non. Established energy system is also required for the achievement of other SDGs. To this effect, greater efforts have been made by most countries to provide access to clean and affordable energy to all. For example, the number of people without access to electricity globally decreased to 733.4mn in 2020 from 1.02mn in 2015. However, this process is not reflective in Africa. According to SDG tracker, about 78% or 567.5mn people without access to electricity live in sub-Saharan Africa 

Nigeria, the world capital of energy poverty 

One of the goals of SDG 7 is to reduce energy poverty to the barest minimum. Energy poverty refers to lack of modern, affordable, clean, safe, and reliable energy. Although several countries have made appreciable progress in reducing energy poverty, available data shows that Nigeria is currently the capital of energy poverty in the world. Out of the 733mn people without access to electricity in the world, about 91.94mn live in Nigeria. In other words, 1 out of 8 persons without electricity live in Nigeria. The second and third positions are occupied by Democratic Republic of Congo (72.46mn) and Ethiopia (56.20mn) respectively.  

Over the years, access to electricity has deteriorated in Nigeria. The number of persons without access to electricity increased by 22% to 91.94mn in 2020 from 75.69mn in 2016. When compared to its peers like Ghana, Kenya and South Africa, Nigeria’s story is a nightmare. While 16.25mn persons entered energy poverty trap in four years (2016-2020) in Nigeria, Ghana and Kenya lifted about 1.51mn and 7.65mn respectively out of energy poverty 

Most of the rural populations in Nigeria do not have access to electricity. According to SDG tracker, only 25% of rural dwellers had access to electricity as at 2020. This implies that about 75mn rural Nigerians do not have access to electricity. Contrarily, about 75% and 63% of rural dwellers in South Africa and Kenya respectively have access to electricity. While South Africa, Kenya and several other African countries have shown substantial progress in rural electrification, the number of persons that do not have access to electricity in rural Nigeria actually increased by 11.68mn between 2016 and 2020. Globally, only 17% of rural dwellers do not have access to electricity. 


Worse still, several persons that have access to electricity could still be classified as energy poor due to power blackout which is rampant in Nigeria. Evidence obtained from General Household Survey of 2019 shows that average national blackout per week is 64 hours. Blackout is worst in the rural areas: rural dwellers experience about 114 hours (or 68%) of blackout per week. In terms of regional distributions, the South-south zone (107.25 hours) and Northwest zone (87.84 hours) experience the longest hours of blackout

 

Poverty in cooking Energy 

Energy poverty in Nigeria is not restricted to access to electricity. SDG tracker records that only 15% of Nigerians have access to clean cooking energy. Global access to clean cooking fuel stands at 65%, while in sub-Saharan Africa, only 17% of the population has access to clean cooking energy. Out of 175.23mn people without access to clean cooking fuel in SSA, Nigeria accounts for 19%. In other words, 2 out of every 10 persons without access to clean cooking fuel are in Nigeria. Globally, about 2.37trn persons do not have access to clean cooking fuel and about 923mn of such persons live in sub-Saharan Africa. People who lack access to clean cooking fuel and modern cooking technologies usually cook with kerosene, animal dung and firewood. Burning these cooking fuels causes severe air pollution. The World health organization (WHO) estimated that about 3.8mn deaths annually are attributed to unsafe cooking fuel. Evidence from the 2019 GHS suggests that about 66.5% of Nigerian households use firewood as cooking fuel. Another 21.3% of Nigerian households use kerosene on traditional stoves while only 10.2% use LPG (cooking gas). The report also shows that less than 4% of households use electricity for cooking purposes.

 

Impact of energy poverty on human development 

Energy poverty poses a substantial risk to human development. Empirical research³ has shown that use of polluting energy such as biomass and firewood could increase the risks of respiratory disorder, heart disease and lung cancer. It could also create climate change exposures that may have secondary effects on health. In addition, exposure to particles generated through “dirty energy” could cause premature death in people with lung or heart disease, nonfatal heart attacks, aggravated asthma, irregular heartbeat, decreased lung function and increased respiratory symptoms, such as difficulty in breathing. The impact of energy poverty on education is also monumental. First, energy poor children are most likely to spend several hours each week in search of firewood. This could reduce child school attendance, reduce reading time and increase the rate of school drop-out. Second, children in energy poor homes and communities may not be able to use educational facilities that could increase the learning potentials of the children, including internet access and other learning aids that require electricity to function.  


The impact of energy poverty on medicine, industry and high-tech ventures cannot be overemphasized. Access to affordable and reliable energy is a vital catalyst for achieving many of the SDGs, including goal 1 (no poverty), goal 2 (zero hunger), goal 3 (good health and well-being), goal 4 (quality education), goal 6 (clean water and sanitation), goal 9 (industry, innovation and infrastructure), and goal 13 (climate action). Access to energy is a veritable engine of economic growth, poverty reduction and shared prosperity⁴. One of the key barriers to firm survival in Nigeria is energy deficiency, leading to about 42% of startup failure in Nigeria⁵.  


Public policy for ending energy poverty 

All efforts made by the Nigerian government to end energy poverty has yielded limited result and this has remained a huge policy burden for achieving the goal of industrial takeoff and the desired level of economic growth. One of the policy options adopted by the Indian government to address energy crisis in India was the establishment of mini[1]grids and micro-grids. Micro-grids are decentralized electricity generation system that usually operate in synchrony with traditional utility grids. However, it can equally function in “island modes” in the case of which it operates autonomously. Shifting from centralized power generation system to a localized, decentralized or distributed generation, especially in industrial layouts, campuses, communities, cities, council areas, etc, makes micro-grid more resilient and competitive. The government of India supported the establishment of about 10,000 mini and micro-grids by private players.  


Massive and commercial deployment of off-grid solar home system was adopted in Bangladesh. Bangladesh used both privately-delivered off-grid solar home systems and publicly supported extension of the main grid through its rural cooperative program to increase the proportion of the population with electricity from 32% to 96% between 2000 and 2020. Vietnam, Ghana and China all made substantial progress in increasing energy access through off-grid technologies. For example, Vietnam increased the proportion of its population with access to electricity from 88% in 2000 to 100% in 2020 through a mix of technologies on both on-grid and off-grid. In Kenya, about 700,000 home solar systems were installed on the pay-as-you go purchase system, which is a flexible payment plan that makes electricity accessible to more people. Nigeria can adopt the micro-grid model to guarantee 24/7 access to electricity. With the current spike in energy prices - (Diesel - N820/ltr; kerosene - N710/ltr; LPG – N950/kg), it is estimated that, at least, 24mn Nigerians who are vulnerable to energy poverty will slide into the energy poverty trap.

Related items.

Get the App

apple-store  play-store

Connect with us


Proshare is a professional practice focused on delivering research and information services to bridge the gap between investors and markets; by delivery on credible, reliable, and timely engagements through the following areas — Impact Research, Market Intelligence, Strategic Advisory, Stakeholder Relations & Digital Media.