Nigerian Energy Report and Outlook

Nigerian Energy Report and Outlook

The Nigerian energy sector is crucial to the Nigerian economy.  Its  importance  to  the  national  economy and the lives of ordinary Nigerians has continued to increase steadily since petroleum was discovered in 1956. For a long period, the fortune of Nigeria has correlated quite significantly with the fortune of oil. Until  recently,  the  oil  sector  accounts  for  over  a quarter of the Gross Domestic Product, 70 per cent of Federal Government revenue and over 95 per cent of the country's export earnings.

In  addition,  the  power  subsector  of  the  energy sector  has  also  been  a  major  source  of  concern  to Nigerians.  Electricity  generation  is  significantly below the national requirement. Nigeria generates less  than  5000MW  for  a  population  that  exceeds over 170 million people. Hence, most of the country is dependent on personal generators and, to some extent, on inverters and solar for a small minority of the  middle-  and  upper-income  earners  that  could afford it. 

The  Centre  for  Petroleum,  Energy  Economics  and Law, CPEEL, University of Ibadan, sees it as one of its core  mandates  to  produce  an  annual  report  and outlook for the Nigerian Energy Sector. This will be complemented by the energy data and information system  that  the  Centre  is  working  on  in  order  to provide  Nigerians  and  others  who  are  working  on the Nigerian energy sector with information on key developments in the energy sector. A current effort at the Centre is the work on the penetration rate of modern energy system to households in Nigeria, a pilot study of which has just been concluded.

The  current  report  provides  an  overview  of  the Nigerian economy in 2014 and 2015 and the key role played by the energy sector. Also, this maiden report covers  developments  in  key  energy  subsectors  of petroleum, and electricity as well as regulatory and institutional  framework  under  which  the  sector operated in 2014 and 2015. Your comments on this first issue of the report will be very much welcomed.