Nigeria Energy Production Trends

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How the Energy System Is Structured

The development of the energy sector in Nigeria is currently based on/guided by several national policies, programmes and initiatives, and these govern the generation and distribution practices of energy companies. The relevant policies and programmes include (GOPA International Energy Consultants, 2014):

  • National Electric Power Policy (NEPP), 2001—guides changes to ownership, administration and regulation of the power sector, including privatization;
  • National Energy Policy (NEP), 2003—covers the development, production and supply of all energy resources including energy utilisation, efficiency and conservation;
  • National Economic Empowerment and Development Strategy (NEDS), 2004—Provides the basis for sustainable poverty reduction, employment generation, wealth creation, and value reorientation. It also makes recommendations for increasing the share of renewable energy in the country’s total energy mix;
  • National Power Sector Reform Act (EPSRA), 2005—provides legal and regulatory structure for unbundling the national electricity power generation and distribution company;
  • Renewable Electricity Policy Guidelines (REPG), 2006—stipulates the intention of the government to expand the renewable energy market;
  • Renewable Electricity Action Programme (REAP), 2006—lays down the actions to be taken in order to increase the contribution of renewable energy to the total energy mix;
  • National Biofuel Policy and Incentives, 2007—aims to support the development of biofuels technology and production of biofuels;
  • Visio 20:2020, 2010—programme with the objective of positioning Nigeria among the top 20 economies in the world by 2020. It identifies key barriers to national development and includes reliable energy provision as a necessary component for economic growth;
  • Renewable Energy Master Plan, 2005 and 2012—a series of steps to be taken so as to improve energy production from renewable energy;
  • National Renewable Energy and Energy Efficiency Policy (NREEEP), 2014—makes recommendations for an integrated renewable energy and energy efficiency model that ensures sustainable development;
  • Draft Rural Electrification Strategy and Implementation Plan (RESIP), 2014—aims to increase access to electricity including at the rural level and supports the utilisation of both on-grid and off-grid energy; and
  • National Policy on Climate Change, 2015—guides the implementation of actions on climate change adaptation activities in the country (News Express, 2015).

Sources of Energy

Natural gas and hydro power are the major sources of electricity in Nigeria. According to the International Energy Agency, in 2013, Nigeria produced 23,635 GWh (81.61%) and 5,326 GWh (18.39%) of electricity and heat from natural gas and hydro respectively (IEA, 2016). However, the share of electricity and heat in final energy use in the country is less than 2% (GOPA International Energy Consultants, 2014). More than 80% [99,305 kilotonne of oil equivalent (ktoe)] of total consumed energy (114,294 ktoe) comes from biomass and waste, while natural gas, re-imported oil products, and coal account for about 13% (see Table 1).



The use of biomass in the form of fuel wood is a major contributor to loss of vegetation cover and increase in desertification in the country (GOPA International Energy Consultants, 2014). Nigeria has strong renewable energy potentials from solar and wind energy; however, their development is currently at infancy.

Profiles of Leading Energy Producers

The Federal Government of Nigeria (FGN), in a bid to improve electricity generation and supply in the country, recently unbundled the national power generation and distribution company, Power Holding Company of Nigeria (PHCN), and opened up the energy sector for the participation of private firms. In collaboration with the United States Government’s Power Africa project, FGN has approved a number of renewable and non-renewable energy production companies (see Table 2) including successor companies of PHCN, Azura-Edo Energy and JBS Wind Power (USAID, 2015).


The operation of the power production plants is expected to have an impact on environmental resources and greenhouse gas (GHG) emissions. Natural gas power plants are estimated to produce carbon emissions within the range of 300 – 700 gCO2eq/kWh. The carbon emissions are estimated at 3 – 45 gCO2eq/kWh from onshore wind farms and 7 – 23g CO2eq/kWh from offshore wind farms (Thomson and Harrison, 2015). Any measures by the companies to curtail GHG emissions will be known as the plants are completed and become operational.

Azura is a developer, financier, acquirer and operator of Independent Power Plants (IPPs) and power related assets in West Africa. Its Azura-Edo IPP is a 450MW open cycle gas turbine power station and the first phase of a 2,000MW power plant facility near Benin City, in Edo State, Nigeria. The project reached financial close on 28 December 2015 and construction started on 5 January 2016 (Azura, 2012).

JBS Wind Power Ltd is a renewable power generation company developing a 100MW wind power plant in Jos, Plateau State, Nigeria. The project consists of 50 x 2MW Wind Turbine Generators (WTG) with a nameplate capacity rating of 100MW that generate approximately 342,000MWH of electricity per year. The economic lifetime of the project is 20 to 30 years (JBS Wind Power Limited, n.d.).

Submitted by Climate Scorecard Country Manager Chiudo Ehrim


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