Bennett Oghifo
World Environment Day is marked all over the world for more than a day. Actually, events are lined up weeklong, and this week, events to celebrate the environment in the 2022 WED are in progress globally, including in Nigeria.
The WED is celebrated annually to recognise the carrying capacity of the Earth. Humanity needs the environment to survive and not the other way round, according to scientists.
So naturally, the theme of this year’s World Environment Day is dedicated to the value of the Earth. There is “Only one Earth”. The point is “In the universe are billions of galaxies, In our galaxy are billions of planets, But there is #OnlyOneEarth. Let’s take care of it,”the United Nations stated.
Earth faces a triple planetary emergency: the climate is heating up too quickly for people and nature to adapt; habitat loss and other pressures mean an estimated 1 million species are threatened with extinction; pollution continues to poison our air, land and water, UN said.
The way out of this dilemma is to transform economies and societies to make them inclusive, fair and more connected with nature. “We must shift from harming the planet to healing it. The good news is the solutions and the technology exist and are increasingly affordable. #OnlyOneEarth is the campaign for World Environment Day 2022. It calls for collective, transformative action on a global scale to celebrate, protect and restore our planet,” the UN stated.
Time is running out, and nature is in emergency mode. To keep global warming below 1.5°C this century, we must halve annual greenhouse gas emissions by 2030. Without action, exposure to air pollution beyond safe guidelines will increase by 50 per cent within the decade and plastic waste flowing into aquatic ecosystems will nearly triple by 2040.
“We need urgent action to address these pressing issues, making ‘Only One Earth’ and its focus on living sustainably in harmony with nature, as pertinent as ever.”
At the core of it all is energy transition from fossil fuels to renewables and since Nigeria’s main stay is crude oil and all its derivatives, it is important for the government and Nigerians to pay keen attention to global demands and policies.
The federal government is negotiating to be allowed to transition gradually from the use of crude oil products to power the nation’s economy to gas, though a fossil fuel, but it is a lot cleaner and is abundant in the country. The government promised the world it would have net-zero emission by 2050, but that before then gas should be used as transition energy.
The Energy Transition is imminent. Countries are slowly making the switch to renewable energy that has no carbon footprint and is healthy for the environment.
Renewables will still need the support of fossil fuels. Gas is the cleanest fossil fuel, and gas has been described as the transitional fuel or the bridging fuel. Increased utilisation of LPG reduces the use of firewood which is derived from trees, and the more trees are cut, the more the nation is exposed to the dangers of desertification.
Gas is clean energy and supports the aspiration to protect mother earth. Clean energy is essential for today’s society, driving economic growth and improving the quality of life for people around the world. But today, according to the International Energy Agency works (IEA) report, there are still close to 770 million Africans without access to electricity, four billion who cook using solid fuels such as charcoal, and hundreds of millions for whom access to electricity is either unreliable due to lack of generating capacity and infrastructure, or an unaffordable luxury.
So, how can Nigeria address the “Energy Trilemma” – Environment, Affordability and Security of Supply – and achieve the UN’s goal to provide clean, affordable energy to all?
Today’s primary focus is on the Future of Clean Energy Transition; how it impacts on Industrial Development and the imperative is to deep dive into the role of LPG as an affordable transition energy driver for industrial growth.
Nigeria LNG Limited (NLNG) has stated that it “continues to deliver on our vision of helping to build a better Nigeria by catalyzing the transition of domestic cooking fuel from the usual biomass and wood to LPG. Nigeria LNG remains a major influencer in the sector. We have dedicated 350,000 metric tonnes of LPG to the market helping to raise the total consumption from the initial 70,000 tonnes in 2007 prior to NLNG getting involved.
“We are fully committed to delivering cleaner energy and to protect our citizens and the environment from the hazards of smoke inhalation while cooking with firewood and other sources of fuel which on record accounts for over 100,000 deaths in Nigeria, mainly women and children just trying to put food on the table. We are set to reverse this trend and to change the narrative with LPG, in addition to helping Nigeria preserve Forex from Kerosene importation and reducing deforestation.
“Also, our domestic LNG (DLNG) initiative is a deliberate effort to enhance access to a healthy, safe, and cleaner energy source, which is a dire need in Nigeria today. Consistent with NLNG’s vision of helping to build a better Nigeria, the initiative will support the economic development of the country and industrialization. NLNG is well positioned to support domestic gas demand and market growth through Volume Optimization.
“The strategy is to deepen NLNG’s footprint and enhance NLNG’s relevance in the domestic market, as well as to ensure local gas utilisation in line with our country’s national gas aspirations. The potential for Domestic LNG exists with credible off-takers and we are already exploring the possibility of LNG to Power with gas-based users across the country.”
What then do we need to do to bring all these home?
The federal government has taken some positive steps to make doing business in Nigeria easier. Among these steps include issuance of Visa on Arrival, changes in processes of registration of companies and the update to the Companies and Allied Matters Act.
On 29th March, President Buhari announced “The Decade of Gas”, an initiative designed to ensure Africa’s biggest oil producer can take advantage of the global energy transition. The ‘Decade of Gas’ initiative saw the unveiling of a range of projects, including the 614kms-long Ajaokuta-Kaduna-Kano (AKK) pipeline at a cost of $2.8 billion to connect the eastern, western, and northern regions of the country, and the construction of $10 billion NLNG Train 7. Policy changes, such as gas flare commercialization and the codification of the Nigerian Gas Transportation Network, are in addition to these projects. All of these will generally have a salubrious effect on other sectors of the economy.
However, there is still a lot to do for us to attract investment in the gas sector; particularly for LPG development. Deepen the Natural Gas Policies (Gas Utilization and Monetisation); Elaborate Fiscal Reforms (NAGFRA – Natural Gas Fiscal Reform Act); Gas Master Plan- implementation considering current realities; Implementation of the PIA for investors’ confidence; Incentives – Tax holidays, Duty waivers, Pioneer status etc.; Government Guarantees & Assurances – To boost Foreign Direct Investment (FDI) in the gas sector; Strengthen the legal system so that commercial cases are dispensed with expeditiously; Sanctity of Agreements – Complying with the terms and conditions of international business agreements.
The Energy Transition push means that there might not always be a use or market for our oil and gas. However, the fact that it is a transition and not just a magical flip of a switch means that as a country Nigeria still has “a window of opportunity we must utilize to position us for a world beyond fossil fuels. Whilst we work hard at capturing the external opportunities that remain, there is an even more important part of the story we must begin to pay more attention to. That is how to directly apply gas to the industrialisation and development of Nigeria’s economy.
Nigeria LNG said, “As we go through a global reset occasioned by the COVID-19 Pandemic, now is a good time to push beyond the long-drawn conversations and get to action. As a company we understand how critical this is, and we will continue to play our role as a pace setter and leader in helping to actualize the full potentials of gas monetization in Nigeria in keeping with our vision of helping to build a better Nigeria.
“Nigeria has ridden on the back of oil for more than 50 years. It is time to fly on the wings of gas!”
According to the 2020 Statistical Review of World Energy conducted by BP, about 60% of global energy is still produced from coal or fuel oils, with high CO2 emissions to the atmosphere, along with other pollutants harmful to the environment and human health, such as Sulphur Oxides and soot.
Switching to LNG and LPG
Utilising renewable energy sources, such as wind and solar, will alleviate these issues, but it will take time to deploy these technologies at the scale required to replace fossil fuels, while some countries and regions may not have the necessary renewable resources to move to a 100% renewable scenario in the medium term. Switching to lower carbon fossil fuels such as LNG and LPG will play a significant role during the energy transition in providing low carbon, secure energy, especially in developing nations and regions with little existing energy infrastructure.
The compelling economic, social, and environmental arguments behind increasing LPG’s uptake as part of the global energy transition are:
Transport – LPG offers a lower NOx and GHG alternative to diesel that is well suited to power vehicles and elicits both environmental and financial benefits.
Heating Homes – LPG can also play a role within the domestic sphere, offering a lower carbon fuel for household heating and cooking.
Industry and LPG – Tackling the emissions produced by these sectors would make substantial inroads in reducing emissions and, without a shift in the types of fuels industry and commerce are utilising, it is unlikely that any carbon or GHG reduction targets will be met. The fact that nearly 50% of the industrial sector in the US uses coal means a significant opportunity exists to switch fuel type to LPG here.
Flexibility – LPG is a flexible solution which can serve to satisfy the energy needs of even the most remote communities, with little centralised infrastructure required. The flexibility of this source is epitomised by recent proposals to use LPG as a fuel source in Qatar to enable them to meet the increased power demand anticipated during the 2022 world cup when there will be a near 50% temporary increase in population.
Low Emission – the carbon footprint of LPG is 20% lower than that of heating oil, and 50% lower than coal. Consuming this fuel in highly efficient gas-transition technologies such as LPG hybrid heat pumps or LPG gas-absorption heat pumps, can lower emissions even further.
Thus, LPG is an ideal fuel to support a renewables-dominated grid, as it is easily stored, does not degrade over time, requires no heating or complex filtration to keep the fuel in a usable condition, and does not constantly boil off.
In case of a leak or spillage, LPG will not contaminate soil or watercourses (unlike fuel oils) and has a much lower Global Warming Potential (GWP) compared to methane, the key constituent of natural gas and LNG.
While natural gas is one of the cleanest fossil fuels, its availability depends on being close to the supporting infrastructure, such as pipelines and LNG terminals. In many regions there is no existing natural gas infrastructure, and distance or volume demand make it uneconomic to expand any existing infrastructure to serve every potential customer. Traditionally these ‘off gas grid’ customers have been served by small, decentralised base load power plants operating on fuel oils, such as diesel or Heavy Fuel Oil (HFO), as these fuels can be readily transported by truck or train. However, fuel oils are ‘high carbon’ fuels, releasing significant CO2 when combusted, as well as large amounts of the other pollutants mentioned earlier.
A study conducted by the World LPG Association in 2019 on the role of LPG in support of Energy Transition reveals that LPG is a much cleaner burning fuel that can immediately reduce CO2 emissions by 20% compared to HFO, as well as reducing other pollutants by 90% or more. The ability to use LPG in high efficiency power plants not only reduces the CO2 footprint of power generation, but also makes electricity more affordable. The volumes of LPG consumed for power generation, even for a small power plant as used by say a mining company or cement factory, can also improve the affordability of LPG for other uses, such as cooking, and help a local domestic fuel market to develop, reducing air pollution and deforestation.
Nigeria and the Paris Pledge
According to the 2020 Carbon Brief report, Nigeria has the largest economy and population of any country in Africa. It is expected to overtake China to become the world’s second most populous country after India by the end of the century. It was the world’s 17th biggest emitter of greenhouse gases in 2015, the second highest in Africa after South Africa.
Nigeria has one of the highest rates of energy poverty in the world and suffers from chronic power cuts. In its recent COVID-19 economic recovery plan, the government pledged to fix its worsening energy crisis through the rapid expansion of solar power.
Nigeria is part of three negotiating blocs at international climate talks. These include the G77 and China, the African group and the Coalition for Rainforest Nations. Our annual greenhouse gas emissions were 481m tonnes of CO2 equivalent (Mt CO2e) in 2016, according to the CAIT Climate Watch.
Nigeria is signed up to the Paris Agreement, the international deal aimed at tackling climate change. It ratified the agreement in 2017. Through this, it has pledged to reduce its greenhouse gas emissions by 20% by 2030, when compared to “business-as-usual” levels. In other words, if Nigeria were to follow a “business as usual” pathway, it would expect its emissions to reach around 442.5m tonnes of CO2e a year by 2030.
In its climate pledge – also known as “nationally determined contribution” – submitted in 2017, the Nigerian government said it would reduce its emissions by ramping up the rollout of solar energy production, improving energy efficiency and ending “gas flaring.”
The government has not yet made much progress on developing solar power. Greenhouse gas emissions from fossil fuel production and use have increased by 16% since 2015, according to data from the International Energy Agency (IEA).
Deforestation, Wood Burning and Agriculture
More than one in three people in Nigeria lack access to electricity. Instead, many rely on the burning of wood, “biogas” – a gas produced from animal and plant waste, and other types of waste to generate energy in the home.
In Nigeria, just 15% of people have access to “clean cooking” and the rest – mostly women – rely on polluting and inefficient cookstoves, says the IEA.
A reliance on wood for fuel is a major driver of deforestation in Nigeria – and improving access to clean cooking has been flagged as a key option for reducing emissions in the country.
In 2019, President Muhammadu Buhari committed to “mobilise Nigerian youths towards planting 25 million trees to enhance Nigeria’s carbon sink” at a UN climate summit in New York.
Nigeria has also committed to restoring 4 million hectares of forest under the Bonn Challenge, a global tropical forest restoration project spearheaded by the government of Germany and the International Union for the Conservation of Nature (IUCN).
In its climate pledge, Nigeria says it will reduce its overall emissions through “climate smart agriculture” – which it says would simultaneously slash emissions while meeting the challenges posed to farming by climate change. Proposed “climate smart” policies include encouraging the planting of more native vegetation and putting a stop to “slash and burn” agriculture.
Impact and Adaptation
Nigeria describes itself as a country that is “considerably impacted” by climate change. Temperatures in Nigeria have risen by around 1.6C since the start of the industrial era – higher than the global average. Depending on the rate of future climate change, temperatures could rise by a further 1.5-5C by the end of the century.
Advances in extreme heat particularly threaten the many millions without access to electricity or air conditioning in Nigeria. In urban areas, just 92 in every 1,000 people have access to air con. In rural areas, it is just 14 in every 1,000, according to the 2020 Carbon Brief Report.
Concentration on Power Generation through Gas:
The current drive of the federal government through the National Gas Policy is to ensure the nation’s natural gas is harnessed to address the crippling power sector, amongst others. Availability of sustainable power will drive other sectors of the economy and to boost the GDP. A typical example is the establishment of the National Integrated Power Project (NIPP) scheme.
Industrial Use: Natural Gas can be used for a variety of industrial processes e.g., space heating, raising of steam via boilers, furnace operations, etc.
Petrochemicals and Fertilizers: Natural gas can be used for production of Polyethylene and Polypropylene products. The Indorama Eleme Petrochemicals Company Limited (IEPL), formerly known as Eleme petrochemicals Company Limited (EPCL) is an active player in this segment. Natural gas is used as chemical feedstock for fertilizer and methanol production. This can be a catalyst for growth in the agro-industries.
Transportation: Compressed Natural Gas (CNG) is used as fuel for Natural Gas Vehicles (NGV) like forklifts, cars and buses. It is especially attractive to organisations that operate large fleets of vehicles, enabling them to enjoy considerable economies of scale. The Dangote trucks are examples of vehicles being retrofitted to use CNG as fuel. This will also significantly reduce the carbon footprint since gas is much cleaner than PMS or AGO.