Energy resource structure and on-going sustainable development policy in Nigeria: a review

Coal

The estimated coal reserve in the country is about 2.7 billion tons in 2011, out of which 650 million tons are roughly proven (about 0.02 % of the world total proven). The production capacity declined from 0.91 million tons in 1959, to an insignificant level in 2011. The drop in production capacity was due to reduction in coal demand and its replacement with gas and diesel as fuel sources to thermal power generation [ ¹¹ , ¹⁴ , ¹⁵ ]. Nigeria ranked low in world coal production by contributing 0.0001 % of the world share [ ¹¹ ]. Coal distribution in the country is uneven across the regions, extending from the cretaceous Anambra basin (southeast) to Dekina (north-central) the Benue basin. Mine production capacity after full rehabilitation and privatization at principal mining sites in Nigeria may possibly obtain the following levels: Onyeama and Okpara (150,000–400,000 tons/year), Owukpa (2,500 tons/year) and Okaba (15,000–300,000 tons/year) [ ¹⁵ , ¹⁶ ]. Some of these mine sites are presented in Table  ¹ [ ¹⁶ , ¹⁷ ].

Crude oil

The estimated oil reserves stood at 37.2 billion barrels in 2011 accounting for approximately 2.3 % of the total global reserves (Fig.  ¹ ) [ ¹¹ ]. The average crude oil production in 2011 was about 2.13 million barrels per day (mbpd) compared to the 2.05 mbpd in 2010 [ ¹² ]. In 2011, Nigeria was the twelfth highest producer of crude oil in the world with 2.9 % of the world total share (Fig.  ² ). Furthermore, the federal government anticipates increasing proven oil reserves to 40 billion barrels in the years ahead. Though, the rate of exploration is at their lowest as only three exploratory wells were drilled in 2011, compared to over 20 wells drilled in 2005. In addition, the average crude oil production in 2012 was over 2.15 mbpd. The increase in production was due to the extension of the existing fields and recent production from deep water fields. The latest deep water field to come on board as at 2012 was Total’s Usan field, which began production of over 100,000 barrels per day (bpd) in July 2012 and was expected to reach 180,000 bpd by the end of 2012 [ ⁷ , ¹³ ].

Fig. 1

Fig. 2

Natural gas

Nigeria has estimated proven reserves of about 5.1 trillion cubic meters (tcm) of natural gas (NG) which approximates 2.5 % of the world total in 2011 and placing the country as the ninth leading NG reserve holders in the world and the biggest in Africa. The production capacity in 2011 was about 39.9 billion cubic meters (about 1.2 % of the world share), which gave Nigeria the 16th position in world’s NG production [ ¹³ ]. The distribution of NG in Nigeria is uneven across the regions. Most of the NG reserves are located in the Niger Delta region of the country. A significant portion of the country’s marketed natural gas is processed as LNG. In 2010, about 17.97 million metric tons (875 bcf) of LNG was exported, making Nigeria the fifth largest LNG producer in the world [ ¹³ ]. The level of natural gas utilization in the country remains low since a large quantity of the produced associated gas is flared due to inadequate infrastructure and market outlets. There is the need to develop a large gas market and adequate infrastructures to improve the sector so as to reduce revenue loss due to gas flaring.

Nuclear power

Nigeria’s nuclear strategy started shortly after her independence in 1960. The government is on the path of positioning Nigeria on nuclear development [ ¹⁸ ]. In Africa, South Africa is the only country that has utilized the energy gotten from nuclear deposits with capacity of about 12.7 terawatt-hours for the year 2011 accounting for 0.5 % of the world’s total consumption share. Considering the nation’s electricity supply, nuclear power will undoubtedly help improve the energy problems. More importantly, nuclear development has benefits that go beyond electricity supply. Its application in agriculture, health, science and technology cannot be overemphasized. Nuclear development is further captured in Nigerian energy master plan.

Hydropower energy resources

The current hydropower potential of Nigeria accounts for about 30 % of the total electricity power supply [ ³ ]; this value is relatively insignificant when compared to the world hydropower energy production. The three main hydropower plants in Nigeria are located in Kainji, Jebba and Shiroro with installed capacities of 800, 578 and 600 MW, respectively, to bring the total installed large hydro capacity to 1,978 MW. The overall exploitable hydropower potential at 2011 was about 14,750 MW of which 3,500 MW is from the small hydropower plants, and 11,259 MW from the large ones [ ³ ]. The exploitable rate at the end of 2011 was about 13.41 %. This rate is low when compared to countries like Norway, Japan, Sweden, France and China with developed proportion of their hydropower potentials standing at about 45, 61, 69, 68 and 30 % in 2009, respectively, and installed capacities of 27.53, 27.23, 16.21, 25.34 and 196.79 GW in that order [ ¹⁹ – ²¹ ].

The percentage electricity generation in the country was 25 % hydro, 12 % thermal (oil) and 63 % thermal (gas) in 2011 [ ¹⁹ ]. The statistics shows that the larger portion of electricity generated was from thermal power plants with about two-thirds of thermal power derived from natural gas. Hydropower used to contribute the larger portion of the total energy mix, but in recent years, all the hydro lakes have been the victim of climate change leading to the subsequent reduction of water intake into the power dams. Because of the fall in the contribution of hydro to the energy mix, the federal government in 2009 proposed the construction of additional hydropower stations as listed in Table  ² .

Wind energy resources

It is a form of clean energy that has been experiencing rapid growth in recent decades due to the promotion of models of renewable energy sources, energy supply security, fuel diversity concerns, ecological awareness, and economic reasons [ ²² ]. Due to its many advantages, wind energy has also become the fastest growing renewable source of energy in both developed and developing countries [ ²³ ]. Nigeria was found to be a poor/moderate wind regime with wind speeds ranging from 2.12 to 4.13 m/s in the southern part of the country with the exception of the coastal regions/offshore, and the north having speeds ranging from 4.0 to 8.60 m/s [ ²⁴ – ²⁸ ]. The total actual exploitable wind energy reserves range from 8 to 97 MWh/year in the north and the northeast region of the country [ ²⁹ ]. The level of wind power development is still low in the country with the few available wind field limited to the 5 and the 0.7 kWp located in the Sayya Gidam and Danjawa, respectively, in the north. A pilot project on the generation of large-scale grid-connected power using wind energy commenced at Katsina State in 2007 with a capacity generation of 10 MW.

Biomass energy resources

Biomass resources of abundance in Nigeria include dead trees, wood chips, tree trumps, animal and human waste, household and organic waste from industries. It is the primary source of energy in Nigeria constituting about 37 % of overall energy consumption among the rural settlers and semi-urban dwellers [ ²⁰ , ²⁹ ]. The total crop residues and animal waste produced is 83 and 61 million tons/year, respectively, while about 80 million cubic meters (43.4 × 10 ⁹ kg) of fuel wood is consumed yearly, with average daily consumption varying from 0.5 to 1.0 kg of dry wood per capita [ ³ , ²⁹ ]. Wood fuel is used mainly for cooking, heating and other domestic purposes. Biomass resources estimate in Nigeria as at 2011 was above 816 MJ (0.02 tons of oil equivalent) [ ²⁸ , ³⁰ ]. Biomass is still used mostly in its crude form in the country, though future utilization as a sustainable energy solution through biodiesel production is in view by the government [ ³⁰ ].

Solar energy resources

Nigeria has an average annual solar incident of about 1,831.06 kWh with a total land area of 923,768 km ² . Evaluation of the technical potential of solar energy in Nigeria shows that a useful annual energy of 15 × 10 ¹⁴  kJ can be obtained with 5 % device efficiency. This translates to about 258.62 million barrels of oil corresponding to 4.2 × 10 ⁵  GWh of electricity production annually [ ³¹ ]. The country has an annual average sunshine of about 6.25 h, ranging from 3.5 h at the coastal regions to 9.0 h at the north [ ³ , ²⁹ ]. Similarly, the mean daily solar radiation is about 5.25 kWh/m ² /day, ranging from 3.5 kW/m ² /day at coastal zones to 7.0 kWh/m ² /day at the north [ ³² – ³⁴ ]. The solar radiation distribution is shown in Fig.  ³ [ ³⁵ ]. Based on the map, three different solar radiation zones can be defined viz: zones I, II and III with each zone having different radiation levels (whose respective values are indicated on the figure legend) that may be needed for a particular project selection and sizing [ ³⁵ ]. Table  ³ gives the irradiation levels for each zone as distributed among the 36 States of the federation. Zone I comprises all the states in the northeast geo-political zones; with high solar radiation incident on the horizontal surface; it has excellent and viable potential for large-scale solar photovoltaic especially in the semi-arid region. Zone II consisting of the northwest and north-central belt of the country also has viable solar radiation that may be required for most solar projects. Low potential of annual global solar radiation exists in zone III (comprising all locations in the south zone including the coastal region), and can only be suitable for stand-alone PV systems. However, some states/locations in the southwest and southeast regions can readily support decentralized energy projects.

Fig. 3

Agricultural sector

The sectoral energy intensities in Nigeria from 1990 to 2011 are presented in Fig.  ¹⁴ . The EI for some sectors has proven to improve over the years. The EI of the agricultural sector decreased by 79.6 % from 0.003 toe per US$1,000 in 1990 to 0.001 toe per US$1,000 in 1998 and its contribution to the total EI in these years was 2.7 %. From 2000 to 2004, the EI increased by 6.8 % whereas between 2008 and 2011 the EI decreased from 0.004 to 0.002 toe per US$1,000 GDP (2005 price). The intensity of energy use in the agricultural sector was remarkably small between 1998 and 2002. The contribution of agriculture to the total EI within these years was 1.2 %, indicating low energy use. However, the energy use in this sector is historically low as most production stems from subsistence agriculture characterized by high human labor intensity, little or no irrigation (rain fed agriculture) and little or no mechanized farming.

Fig. 14

Industrial sector

The industrial sector (Fig.  ¹⁴ ) experienced an increase in EI from 1990 to 1994. The EI varies from 0.032 to 0.035 toe per US$1,000 in 1990 and 1994, respectively, indicating an increase by 8.7 % and contributing about 27.8 % to the total EI in these years. Between 1996 and 2000, the EI steadily decreased from 0.031 to 0.027 toe per US$1,000 in 1996 and 2000 giving a drop of 13.55 % and a contribution to the total EI of about 25 %. Subsequently, between 2002 and 2004 the EI increased by 5.4 % and decreased significantly by 54.3 % from 2006 to 2011; this may be due to changes in government fiscal policy on the industrial sector and some forms of efficiency measures. However, the primary driving force of the energy intensity of the industrial sector is the rapid growth of investment and also, increase in number of energy intensive industries like the steel manufacturing, cement and construction.

Transportation sector

The transportation sector comprising the road, air and water remained the principal consumer of energy in Nigeria (Fig.  ¹⁴ ). The EI of the sector rose by 17.74 % with increase from 0.064 toe per US$1,000 in 1990 and reaching a value of 0.078 toe per US$1,000 in 1996. The contribution to the total EI from 1990 to 1996 was 55.47 %. The EI value decreased from 0.069 to 0.039 toe per US$1,000 in 1998 and 2010 indicating a drop of 43.17 % with a slight increase of 1.65 % in 2011. The contribution of the transportation sector to the total EI from 1990 to 2011 was the highest and stood at 59.63 %.

Residential/commercial sectors

The EI of the residential sector decreased from 0.010 toe per US$1,000 in 1990 to 0.001 toe per US$1,000 in 2011 reflecting a drop by 90 %. The EI of the residential sector have been on the decrease over the studied periods indicating a little use of energy in the sector. The reason for the low EI in the sector is due to the epileptic power supply and non-availability of grid supply to the rural communities of the country where about 70 % of the entire population reside. The contribution of the residential sector to the total EI from 1990 to 2011 was 3.99 %. The commercial sectors are also characterized with low EI values. The EI of the sector decreased from 0.019 toe per US$1,000 in 1990 to 0.002 toe per US$1,000 in 2011 having drop of 89.47 %. The contribution of the sector to the total EI between 1990 and 2011 was 7.84 and 3.85 % above that of the residential sector. The sector witnessed an increase in EI by 28.1 % between 1994 and 1996 followed by a 17.27 % decrease between 2000 and 2002. The fluctuations in the performance may be attributed to the unstable economic policies. However, the commercial and the residential sectors have been characterized with low energy use which is an evidence of low energy use activities.

The period 1980 to 2000

The period from 1980 to 2000 was characterized by decrease in total EI and CO ₂ emissions per unit GDP as shown in Figs.  ⁹ and ¹⁵ . The overall CO ₂ emissions and per person CO ₂ emissions were also found to increase as the energy consumption increases. The average GDP growth rate was 2.45 % while the energy consumption growth rate was 0.39 %. This was satisfactory for a sustainable development where the energy consumption growth rate was reasonably lower than the GDP growth rate. It was observed that the ECEC within this period was around 0.15 and from 1992 to 1995 the country’s economy improved with a corresponding reduction in energy consumption leading to a negative ECEC (Fig.  ¹³ ).

Fig. 15

The period 2001 to 2004

The period from 2001 to 2004 witnessed an increase in energy consumption with a corresponding increase in CO ₂ emissions per capita. The ECEC at this period was 0.20 with a 12 % increase in EI (Fig.  ¹³ ). The GDP growth rate shown in Fig.  ⁹ was 5.2 % while the energy consumption growth rate was 0.98 %; this may be attributed to the increase in investment, the resuscitation and establishment of the cement industry, small steel industries, establishment of new gas turbine plants and the rapid growth witnessed in the telecommunication industries. For example, MTN a telecom company and the leading mobile phone provider in Nigeria had over 6,000 diesel generators installed for power supply in its base stations. The plants operate for 20 h a day, and the company spends about 5.5 million USD on diesel fuel yearly to keep the plants running [ ⁴¹ , ⁴² ]. Other providers also exist to give a boom to the sector. It will also be deduced that the improvement of the economy from 1980 to 2000 and from 2001 to 2004 was marginal.

The period 2005 to 2011

From 2005 to 2011, there was a decline in EI but the energy consumption growth rate was almost steady though declined in between years. The EI for the industrial sector (Fig.  ¹⁴ ) was found to have dipped from 0.022 to 0.011 toe per US$1,000 while the CO ₂ emissions per capita (Fig.  ¹⁵ ) declined by 37.6 % from 2005 to 2010. The GDP and energy consumption growth rates were 2.11 and 0.06 %, respectively. This small sustainable improvement in energy efficiency obtained especially between 2005 and 2011 was attributed to policy measures and energy programs launched by the Energy Commission of Nigeria (ECN) in 2004 [ ⁴³ ]. In addition, the low energy growth rate from 2005 to 2011 may be attributed to the decay in the performance of the industrial sector. The contribution of the industrial sector in real GDP declined from 3.59 % in 2009 to 4.49 % in 2010 while that of the transportation declined from 6.83 % in 2009 to 6.79 % in 2010. The drop in performance of the industrial sector was due to inadequate infrastructure especially energy, transport, high cost of funds, multiple taxation and small domestic patronage whereas for the transportation sector, the low trade-associated activities and the poor state of the highways decelerated the growth [ ⁴⁴ ].