The governance of energy transition: lessons from the Nigerian electricity sector

Abstract

Background

The rising need for transition towards more sustainable energy sources requires a rethink in the governance of energy systems. Arguably, policy makers have very important roles in governing transitions in any given society through established institutional frameworks. It has also been argued that energy infrastructure choices are determined by institutional dynamics and structures. However, what are the underlying influences required to change energy systems and what lessons can we draw from them for the governance of energy transition? This study focuses on understanding the dynamics of energy transition governance in the Nigerian electricity sector with the aim of drawing lessons that impact on energy transition and energy systems change.

Methods

Using explorative research tools, this study investigates the dynamics of energy transition governance in the Nigerian electricity sector with the aim of drawing lessons that impact on energy transition and energy systems change. Data from primary and secondary sources in documentary archives as well as other published sources that are linked with the provision of the Nigerian historical energy infrastructure were used for the analysis in order to draw lessons on energy transition dynamics in Nigeria.

Results

The study revealed that there were three important factors that had a direct impact on energy transition and energy systems change in Nigeria’s electricity sector. These are: (1) Changing perceptions and goals (during the period leading up to Nigeria’s independence, 1890–1960s); (2) Direct government interventions in energy infrastructure provisions (1940s–1970s); and (3) Major changes in market rules (from 2005 and beyond).

Conclusions

The study concludes by highlighting that: (1) there is a need for government institutions to tackle energy access issues that address the needs of the poor; (2) it is imperative to explore technological options that are more sustainable; and (3) there is a need to address energy consumption patterns that are more energy intensive. Indeed, available energy resources, technological changes in electricity supply systems, and the ‘geographies of energy’ are major factors that influence energy production and consumption dynamics. All of them needs should be considered, as energy decisions are primarily political choices.

Background

Energy systems can be very complex, entangled with multiple interconnected issues that require both urgent and simultaneous solutions that may lead to unprecedented energy transition [1]. Changes necessitating a transition in energy use have also serious consequences for energy governance [2]. Providing access to modern energy, improving the security of energy supply and reducing the effect of energy systems on climate are three important global energy challenges with implications on national and global energy governance [1]. Energy governance is aimed at addressing some of these challenges. However, the complexity of energy challenges requires the involvement of various actors and stakeholders in offering solutions that address the diverse aspects of these challenges [3, 4]. Indeed, addressing these challenges requires a polycentric energy governance system as most energy related challenges cannot be easily addressed within a single agency or regime [5, 6].

Transitioning away from our current fossil intensive energy system is a necessity [7]. The current state of use of available fossil based resources is simply unsustainable due to the increasing economic, social and environmental requirements. The current techno-institutional complex discriminates against other technologies and favors fossil fuels [8]. The future of energy is of great concern to both policy makers and end-users alike [9]. It is a considerable central challenge confronting governments, industry players, end users and other stakeholders [10]. Understanding the motives and drivers of energy transitions is of utmost importance in affecting an energy systems change. However, how is energy transition occurring? What lessons can we draw from energy transition dynamics in the global south, within a developing country’s context? This paper explores the energy governance dynamics in the Nigerian electricity sector while drawing out lessons on some of the impacts of the various governance dynamics.

Nigeria has been chosen for this study because of its vital role as a major energy provider, as well as its energy poverty challenge [11]. About ninety million people, amounting to about 45% of Nigerians, have no access to electricity [12,13,14]. The Nigerian electricity sector has undergone serial changes over time to address some of the inherent challenges, including the partial liberalization of the electricity market. However, some of the problems still persist. In what ways do historical decisions impact on energy transition? What lessons can we draw for future energy governance in the electricity sector in Nigeria and other developing countries with similar trajectories? Addressing these questions within the Nigerian context can provide some generalizable learning that can be used for understanding some historical factors that have shaped the electricity systems in developing countries [9, 15, 16].

In “Research context” Section, some background is presented that contextualizes the study. “Materials and methods” Section presents some brief methodological considerations. In “Results” Section, the main findings detailing the important features of Nigeria’s electricity system and their impact on energy transition are presented. The discussions and concluding thoughts are presented in “Discussion” and “Conclusions” Sections respectively.

Research context

Energy transition is primarily driven by the quest to reduce environmental harm caused by continuous burning of fossil fuels [15, 17, 18]. A major consequence of this are the efforts directed towards limiting CO₂ emissions [19]. Rojey argues that improving energy efficiency, increasing the share of low-carbon energy sources in our energy mix, and introducing Carbon Capture and Storage facilities can help reduce CO₂ emissions in a considerable way [20]. Rojey further argues that ensuring technological progress to support new technologies that limit CO₂ emissions, defining new energy governance rules that go beyond legislation, and introducing a new lifestyle that are less energy intensive are examples of actions that are required for a successful energy transition.

It is important to understand energy transition from a geographical and political perspective [21,22,23]. Rocher and Verdeil, in examining the socio-technical collectives involved in the Tunisian energy transition argues that there are four major elements that can be used as a basis to analyze the role of distributed agencies. These elements, which are crucial in understanding the dynamics at play on-the-ground, can help in providing useful guidance on affecting energy transition to low carbon energy sources. They include [21],

• the actors involved in energy issues, including those involved in offering solutions to energy challenges at local, regional and national levels;

• the (shared or unique) visions of the various actors and the goals that they pursue or the interests they defend;

• the current available technologies in the energy production and consumption systems;

• and the conditions and policy instruments under which the current technologies at play are rolled out.

Indeed, at the heart of all the ongoing changes in energy systems are the drivers of electricity demand and supply. It is argued that there are some major drivers of electricity demand and supply necessitating changes in energy systems [24]. These include,

• i. Prices: End user energy prices and fuel costs play a vital role in energy systems change. It is generally believed that the higher the energy price, the lower the consumption due to energy efficiency measures, energy savings and/or a switch to other cheaper alternative energy sources would be. Arguably, the life cycle cost of renewables is much cheaper than that of a fossil-based energy source due to additional fuel costs [25, 26].

• ii. Economic factors: Factors such as GDP growth rate and increased income levels have a strong correlation with electricity demand growth. Increased income levels of households directly affect comfort levels through increased energy expenditure for cooling and heating requirements [27, 28].

• iii. Subsidies: Subsidies for certain types of technologies such as solar PV (and other renewable technologies) play a vital role in ensuring the adoption of such technologies. Subsidies for certain energy resources (such as crude oil and natural gas) also determine to a large extent the kind of energy infrastructure we end up with [29, 30].

• iv. Structure of electricity demand: This includes demand level, peak load and demand variation, energy intensity, etc. Since electricity cannot be stored, it has to be produced and consumed simultaneously. This means seasonal and instantaneous variations in energy demand have to be met. Indeed, systems need to be matched with the demand in such a way that long term energy demand (over a long time period) and peak load (short term) demand are met [31].

• v. Industry structure and other policy factors: Industry structure plays a vital role in energy infrastructure choices. A country/region with intensive industrialization drive will necessarily need to make energy decisions that support industrial growth. Other policy factors such as reaching certain emissions and energy efficiency targets could have significant impact on energy demand and supply [32].

• vi. Potential for energy savings and demand side management (DSM): As many countries in Europe are gradually becoming less industrialized and move towards a more service intensive economy, the need for greater energy savings and demand-side management becomes paramount. The offshoring of manufacturing processes necessitates a rethink in energy systems and use, particularly in embracing energy efficiency measures. Technologies that help save and optimize energy consumption could also have significant impact on energy demand [33, 34].

Energy transition dynamics in Nigeria

Energy transition in Nigeria is a necessity, not only because it provides environmental gains but also because Nigeria’s current electricity infrastructure is mainly characterized by an unstable grid, obsolete systems infrastructure, and demanding logistics to keep the lights on [13, 35, 36]. Addressing the challenge of energy infrastructure deficit and replacing obsolete infrastructure provides an opportunity for an energy transition that ensure the provision of more electrical power from cleaner energy sources in a sustainable way without a detrimental impact to the environment [37, 38]. Indeed, if energy transition is a necessity, in what way has Nigeria tried to effect these changes in energy systems? What changes have occurred over time? Fig. 1 provides a panoramic overview of the various stages of the Nigerian energy transition whereas Fig. 2 shows the key features of the Nigerian energy transition within each era of energy use.

Fig. 1

source use in Nigeria since 1800 (Source: [6] (pg. 51))

Transition in energy (re)

Fig. 2

A panoramic view of the energy eras and the key features of the Nigerian energy transitions [18]

In Fig. 1, the various eras of energy use are defined following different time periods. Starting from the pre-industrial (agricultural) era from the 1800s, we notice a gradual change in technology use and social practices that became more energy intensive, thus requiring more energy dense sources which explain the changes in energy resource use [39, 40]. Energy (re)sources have been a major (but not the only) driver and mediator in affecting energy transitions in Nigeria [41]. Changes in energy sources based on available energy resources have also impacted on technology shifts over time [42, 43]. In this study, we further explore the factors that necessitated energy transition and energy systems change within the Nigerian context while particularly focusing on the role of resources and available technologies as is later presented in “Results” Section.

Materials and methods

This study investigates the dynamics of energy transition governance in the Nigerian electricity sector with the aim of drawing lessons that impacted energy transition and energy system changes. In this study, archival documents of various institutions and other relevant literature were used for data collection by means of documentary literature research tools. Scott argues that documents are texts produced by an individual or a group with the exclusive aim of addressing immediate practical needs [44]. They are written based on particular assumptions and with a clear purpose. In this study, data from primary and secondary sources from documentary archives as well as other published sources associated with the Nigerian historical energy infrastructure provisions were used for analysis in order to get a better understanding of the Nigerian energy (infrastructure) history.

The data were collected from published reports, unpublished internal memos, statistical and historical archives of key institutions that collect records as well as maintain archives of vital historical happenings around the key infrastructure development. The institutional archives visited for the purpose of data collection include,

• 1. the Nigerian Railway Corporation;

• 2. the Federal Ministry of Power;

• 3. Targeted electricity generation companies

• 4. The Lagos State Records and Archives Bureau

Figure 3 shows the methodological workflow for the study. An analysis of the collected data was carried out using archival analysis. Archival analysis entails sense-making and drawing meanings from a set of historical texts [45]. The below-mentioned steps were followed in analyzing archival documents/records used in this study [45, 46].

• 1. Vetting the documents: this process involves checking to ascertain if there are any special markings or figures on the documents that could tell us something in connection with the subject under study. Circle or highlight those markings

• 2. Observing the parts: this entails finding out who wrote the documents and for which purpose. When was the record produced and archived? Are those dates useful in analyzing times of energy transition and how society develops over time?

• 3. Trying to make sense of the documents: this stage entails trying to obtain the main ideas of the documents. Why was the document written? Are there useful aspects that support my research and might be used as evidence?

• 4. Use the documents as historical evidence: this stage helps in asking questions that could help provide answers to validate the use of those documents as evidence. For example, where can I find more information about a particular event referenced in the document? Where can I find more information about the person who wrote the document? Are there empirical evidences that are the aftermaths of the issues observed in the documents?

Fig. 3

Methodological workflow

Results

Following collection and analysis of data, the study reveals that three major factors characterized Nigeria’s electricity sector that had a direct impact on Nigeria’s energy transition and energy systems change. These are:

• changing perceptions and goals (during the period leading up to Nigeria’s independence, 1890–1960s);

• direct government interventions (1940s–1970s);

• major changes in market rules (from 2005 and beyond)

The following sub-sections now delve into further details around the aforementioned themes.

Changing perception and goals of Nigeria’s electricity system (1890–1960s)

The study revealed that changing perception and goals of Nigeria’s electricity systems were manifested in three main ways:

• The change in motives for energy infrastructure provision

• Intermittent switch in energy fuels

• Changes in energy technology in use

With respect to the change in the motives for energy infrastructure provisions, the study revealed that initial provision of electricity infrastructure was motivated by the need to light up settlements and government offices mostly occupied by Europeans. Lighting was the primary motive for the provision of the first power plant in Nigeria, the Lagos Marina station as shown in Table 1. The increased demand for electricity beyond lighting applications led to the expansion of existing plants and the provision of new ones as shown in Table 1. The need to power the workshops of the Nigerian Railway Corporation (NRC) for the maintenance of locomotives triggered the next wave of power plant expansion. In the Plateau region of Nigeria, the need to provide electricity to support mining activities for Tin was another motivation for provision of electricity infrastructure in that region. The topography of the region (being a high plateau) supported the provision of the first hydropower plant in Nigeria. Indeed, lighting, powering of NRC workshops, supporting the Tin mines and powering government offices and government settlements were key motives for the provision of electricity infrastructure in pre-independent Nigeria.

Table 1 Summary of electricity infrastructure provision in colonial Nigeria (

The fuel source for the power plants also constituted a vital part of electricity infrastructure decisions. The study revealed that during colonial Nigeria, most power plants depended on diesel as their fuel source which at that time was imported from the United Kingdom. However, the discovery of coal in Nigeria in 1909 triggered the use of coal for the Iddo power station that was commissioned in 1923. Indeed, the study further revealed that the discovery of coal did not really change the energy fuel trajectory from diesel to coal. However, it was observed that more diesel power plants were installed up to 1940 as shown in Table 2.

Table 2 Other electrical infrastructure provision in Nigeria (1933–1940) (

Energy technology also played a dominant role in the provision of electricity infrastructure in Nigeria. The study revealed that the dominant technology for most power plants that were deployed in Nigeria between 1890 and 1940 were steam engine technologies that were either diesel-fired of coal-fired power plants. The only exception was the hydropower plant built in the plateau region due to the advantages presented by the topography of the region. Indeed, the study demonstrated that there was a case of technological lock-in to the use of steam engine technologies that was interrupted (and completely halted) by the Second World War since at that time it became impossible to get maintenance spares for the plants owing to the war.

Some other power stations that operated on stream are listed in Table 2, along with their capacity, location and institution responsible for its provision.

Direct government interventions (1940s–1970s)

The study reveals that government intervention in the provision of electricity infrastructure was evident through the establishment of institutions that were given the mandate to address a specific challenge that served as a barrier to the diffusion, spread and expansion of a new and existing electricity infrastructure catering to the growing energy needs. Table 3 provides a summary of various government interventions in electricity infrastructure, institutions responsible and their central focus.

Table 3 Direct government interventions in Nigeria’s electricity infrastructure provision (

In the 1940s, the Nigerian Government Electricity Undertaking (NGEU) was established by the British colonial government out of the Public Works Department (PWD) to design a plan to increase electricity infrastructure provision by at least 200% to pave the way for industrialization in Nigeria. This intervention led to the establishment of several industries in different parts of the country starting from the early 1950s. Indeed, by 1970, there were more than 2000 industries scattered around different industrial estates in Nigeria. The NGEU, which was set up as a holding company, eventually morphed into a new corporation in the 1950s called the Electricity Corporation of Nigeria.

The Electricity Corporation of Nigeria (ECN) was the second major institutional intervention set up by the Nigerian government with a mandate of seeking ways of providing the cheapest form of energy that is consistent with continuity of supply. The ECN was established on the 6^th of July 1950 but only took over from the NGEU on the 1st of April 1951. The ECN continued with their established mandate. However, frequent cases of fire outbreaks owing to electrical faults necessitated an intervention by the Nigerian government to further extend the mandate given to the ECN (in the 1960s) to include developing standards for electrical equipment and devices to help curtail the frequent fire incidences.

The study further revealed that in the 1960s, government interventions on electricity infrastructure provision led to the establishment of the Niger Dams Authority (NDA) with a clear mandate of developing Nigeria’s hydropower potential. This intervention led to the planning and provision of several large dams in Nigeria, particularly Kainji, Jebba and Shiroro dams.

The need to have a coordinated system where one central institution of government can take charge and responsibility for everything that has to do with electricity infrastructure in Nigeria led to the establishment of the National Electric Power Authority (NEPA) in the 1970s. NEPA came about as the result of a merger of the Niger Dams Authority and the Electricity Corporation of Nigeria.

Indeed, the study further revealed that there were other interventions that were mainly private interests. The Nigerian Electricity Supply Company (NESCO), a British company, and the African Timber and Plywood Company (AT&P) are examples. Table 4 shows the number of power station s in Nigeria as of 1952 and the institutions responsible for its provision.

Table 4 Number of Power station in Nigeria, Institutions responsible and their capacity as of 1952 (

The study also demonstrated that several government interventions led to widespread diffusion and provision of several electricity infrastructures. As of 1953/54, there were a total of 43,659 electricity consumers in Nigeria. With respect to the electricity consumption patterns in the 1953/54 fiscal year, about 50.3% of electricity produced was consumed through various forms of domestic applications, closely followed by power requirements for public utilities which took about 33.1%. Commercial applications were responsible for 12.7% of total electricity consumption while public lighting and other miscellaneous uses accounted for 1.7 and 2.2%, respectively, of total electricity consumption as shown in Fig. 4.

Fig. 4

Electricity consumption pattern in Nigeria (1953/54)

Major changes in market rules (from 2005 and beyond)

The study revealed that major changes in market rules played an important role in the governance of energy transition in Nigeria. Some key events highlighted in Table 5 led to changes in market rules in Nigeria’s electricity sector and also affected Nigeria’s energy transition.

Table 5 Key events leading to changes in market rules in Nigeria’s electricity sector (2000–2015) (

The liberalization of the Nigerian electricity sector was a major reason for changes in market rules. This process started in 2001 with the introduction of the National Electric Power Policy (NEPP) which paved the way for the production of the National Energy Policy (NEP) framework in 2003. The NEP framework provided a basis for the preparation and enactment of the Electrical Power Sector Reforms Act (EPSRA) in 2005. The EPSRA act provided the legal/regulatory backing that aided the liberalization process of the Nigerian electricity sector. This act paved the way for the establishment of the Power Holding Company of Nigeria (PHCN), a holding company that was eventually unbundled to eighteen companies comprising six generation companies, one transmission company and eleven distribution companies.

The study indicated that the liberalization of the Nigerian electricity market also opened up other opportunities for Nigeria by providing a platform for the establishment of some important agencies of the government or some regulations to address specific challenges within the Nigerian power sector. An example is the formation of the Nigerian Electricity Regulatory Commission (NERC) saddled with the responsibility of regulating the activities of various players within the Nigerian electricity sector. The Renewable Energy Policy Guideline (REPG) and the Renewable Action Program (REAP) were instrumental for initiating the large-scale deployment of solar home systems and off-grid solutions. The national biofuels policy formulated in 2007 assisted the formulation of a national guideline for the use of biofuels. Indeed, these various changes in market rules were instrumental in the liberalization of the Nigerian electricity market which paved the way for the inclusion of cleaner on-grid and off-grid energy sources to Nigeria’s energy mix.

Discussion

Following the findings from this study, four important lessons can be drawn from the Nigerian case for the understanding of energy transition processes in developing African countries. These processes include;

• 1. policy and institutional interventions shaping energy transition pathways;

• 2. technological interventions tending towards technological lock-in

• 3. societal everyday practices shaping energy use patterns

• 4. available energy resources playing a major role in energy technology choices

Following these findings, it is evident that policy and institutional interventions manifest themselves in various ways, particularly through government institutions and other multilateral organizations that come together to seek ways of addressing some common societal and global challenges such as energy access [48, 49], energy security [43, 50], de-carbonization [51, 52] and climate change issues [53, 54]. We noticed similar trajectories of policy and institutional interventions (as in Nigeria) in Ghana that led to the initial provision of diesel-fired generators, hydro power plants and later large gas-fired thermal power plants [55]. These interventions were driven by both endogenous and exogenous factors such as increased residential energy demand, energy for industrialization and commerce, and later, climate change agreements [56,57,58].

Another important factor in the policy environment that impacted on the electricity infrastructure interventions in Nigeria was an industrial policy (from the 1940s) aimed at providing the electricity infrastructure to aid industrialization [6, 59]. This greatly shaped electricity planning that led to increased coal –fired power plants in the 1940s, and later the building of hydro-power plants from the 1950s. The provision of thermal power plants and (more recently) the scaling up of decentralized renewables as a way to address energy access issues and to support small businesses are also results of policy interventions [60]. The World Bank Group argues that to achieve a sustainable energy future for all, there is a need to ensure universal energy access that focuses on the poor which can be achieved more quickly through the rapid expansion of renewable energy [61]. Indeed, exploring the political economy of energy is important in order to understand energy transition processes [7, 62, 63].

Various technological interventions over time have impacted on energy systems change and energy transition. Electricity systems in many countries started off with the use of steam engines from the late 1800s to the early 1900s [41]. Further technological changes that saw the shift from one technology to another also occurred. The shift from steam engines [64] to diesel engines [65], thermal power plants [66], hydroelectric power [67] and the various forms of renewable technologies, including solar photovoltaic cells [68], concentrated solar plants [69], wind technology [70], etc., are clear evidence of the role of various energy technology pathways in ensuring energy transition and energy system changes within the Nigerian context.

Social and societal (everyday) practices, which essentially consist of the way people habitually do things, have evolved over time [71]. Some everyday practices such as cooking, commuting, trading, entertaining, etc., have evolved over time in such a way that they now require more energy than ever before [72,73,74]. The fact that energy infrastructure provision has enabled some everyday practices to be performed in a manner that helps to satisfy the need for greater levels of comfort, cleanliness and convenience has also increased the public value for energy [28, 75]. Indeed, energy is that net currency that enables the actualization and entrenchment of new and existing practices becoming more energy intensive.

Available energy resource options have played (and will continue to play) a dominant role in energy choices and energy system changes. Most countries started off with electricity systems that depended on coal as the major fuel source. The discovery of other fuels such as crude oil and natural gas changed the energy landscape by enabling the introduction and provision of new power plants that depended on those fuel sources [76].

Political interests of policy makers also came to play a major role in many infrastructure decisions, particularly energy and electricity. Prior to 1960, many infrastructure decisions were aligned to the interest of the colonial governments. Between 1966 and 2000, Nigeria was under (the most part of the period) a military rule. Most decisions were results of military edicts with minimal stakeholder consultation [6, 18]. This meant that a lot of the infrastructure provided during this era was simply aligned to the interest of the military regime. From the 2000s, with the advent of a democratic rule, there was a gradual transition to infrastructure decision making that had a pattern of inclusiveness that was aligned to the interests of policy makers [41, 43].

A major limitation of this study is the sole dependence on archival records for data collection and analysis. Archival analysis was necessary since those who were involved in most historical electricity infrastructure decisions prior to 1960 are either dead or were unavailable to be interviewed in order to understand the historical energy transition governance dynamics. Indeed, interviewing stakeholders who were involved in historical electricity infrastructure decisions prior to Nigeria’s independence (in 1960) would have provided more insights in the transition factors (such as contextual factors and future expectations) that led to certain transition outcomes in the forms of changes in energy systems [43, 77].

Conclusions

To conclude, there are three takeaways from this study that are of utmost importance. First, there is a need for government institutions to tackle energy access issues that addresses the needs of the poor; Secondly, it is imperative to explore technological options that are more sustainable; and thirdly, there is a need to address energy consumption patterns that are more energy intensive. Indeed, available energy resources, technological changes in electricity supply systems, and the ‘geographies of energy’ are major factors that influence energy production and consumption dynamics. All of them needs to be considered as energy decisions are primarily political choices.