Nigeria may struggle to attract new Final Investment Decisions (FIDs) for large gas-fired power plants unless it resolves longstanding structural problems in the electricity sector.

This comes as stakeholders, who spoke at a virtual media briefing on Nigeria’s Energy and economic diversification pathways, organised by the Natural Resource Governance Institute (NRGI), in collaboration with the Nigeria Council on Climate Change (NCCC), The NEXTIER Group and The Electricity Hub said attention would continue to focus on solar as leading energy in Nigeria despite rising energy transition induced borrowing which is increasing Nigeria’s debt profile.

The speakers argued that weak infrastructure, poor sector liquidity and dwindling international financing are eroding investor confidence in gas-to-power projects.

Speaking at the event, Lead, Sustainable Energy Supply at NRGI, Aaron Sayne, said Nigeria’s gas-fired power sector had reached a critical point where investment would remain elusive unless the underlying commercial and operational challenges were addressed.

According to him, gas has historically been the backbone of Nigeria’s electricity supply, but its contribution has stagnated.

He attributed the investment slowdown to a combination of commercial, technical and financial constraints.

He identified inadequate gas supply, poor transmission infrastructure and persistent liquidity problems as the three major barriers confronting Nigeria’s gas-to-power ambitions.

Speaking on behalf of the National Council on Climate Change (NCCC), Jummai Vandu said Nigeria remained committed to achieving net-zero emissions by 2060 while balancing the expansion of renewable energy with the responsible transition of its natural gas resources.

Vandu said Nigeria was working to implement the Climate Change Act 2021 across critical sectors, while aligning national policies with its Nationally Determined Contributions under the United Nations Framework Convention on Climate Change (UNFCCC).

Also speaking, Country Manager of NRGI, Tengi George-Ikoli, said the organisation’s assessment of Nigeria’s Energy Transition Plan was intended to identify opportunities and remaining gaps rather than rank government performance.

She noted that although the country’s solid minerals sector currently contributes only about 0.5 per cent of Gross Domestic Product, rising global demand for critical minerals presents an opportunity to diversify the economy.