Subsidy removal: Turning the pains to gain
One of the ways of turning adversity into opportunity is developing a growth mindset. The present situation Nigeria has found herself a…
Fuel Subsidy removal
One of the ways of turning adversity into opportunity is developing a growth mindset. The present situation Nigeria has found herself after the subsidy removal is a necessary sacrifice that should bring smiles to the population eventually when new vistas of opportunities are opened in a Green Economy.
About 70 million litres of fuel are consumed daily by Nigeria’s estimated 200 million people. But most of Nigeria’s oil is refined abroad and imported back to Nigeria, which has been purported to contribute to its high costs. However, those costs were shouldered by the Federal Government of Nigeria as subsidies to reduce the fuel costs paid by the citizens.
Over the years, this retail cost of mainly Premium Motor Spirit (PMS) has determined the cost of almost every good and service in the country. The Nigerian government introduced an oil subsidy to cushion the effect of rising global oil prices in the 1970s. The Olusegun Obasanjo military regime formalized the subsidy in 1977 when it promulgated the Price Control Act which regulated the prices of items including fuel.
Removal of fuel subsidies simply means the government not paying for the difference between pump price and the actual cost of importing fuel anymore. It technically means full deregulation of the downstream sector to pave the way for vibrant competition by other interested investors.
Nigerians have borne the brunt of the subsidy removal, no doubt, but it is pertinent to state that disincentivizing fuel consumption should be a pathway to the transition from fossil fuels to cleaner sources of energy. Nigeria should direct most of its revenue from fossil fuels of the present to investments in the Green Energy future.
It’s been established by ‘Imagine Nigeria’, a report by the High-Level Panel established to explore the future of Nigeria, that a flourishing Nigerian green economy is estimated at $250 billion in investment opportunities in critical sectors, including energy, transportation, infrastructure, manufacturing, agriculture, and land use.
Thus, it is exigent to develop an investment portfolio that takes into account business scenarios and business opportunities that a futuristic Green Nigeria offers. By turning to renewable sources, Nigeria can build a more inclusive, resilient, and booming nation, surmounting current challenges, such as diminishing oil revenue, climate change, social inequality, poverty, and insecurity.
Renewable energy sources are sustainable in that they naturally replenish themselves and are abundant in Nigeria. The use of renewables has gained traction globally as part of 21st-century sustainability principles that respond to the degradation of the environment. Unlimited energy resources like solar, hydro, wind, and geothermal heat are harnessed from nature and are readily available in Nigeria.
Solar is one of the most auspicious renewable energy sources due to its apparent “illimitable” potential. Nigeria has great potential for solar energy; the country is located within the “high sunshine belt” region and is just north of the equator. The annual average of total solar radiation varies from about 4 kWh/m2.day in the coastal regions to approximately 6.5 kWh/m2.day in the north.
Taking advantage of this natural resource, and responding to the adversity of subsidy removal, built environment professionals, especially architects can begin to design and build homes, and public infrastructure that apply passive use of renewable sources and in some instances, active usage.
Beyond that, it is incumbent on the government of the day to marshal out a mass housing blueprint that takes into cognizance the green building concept. The green building concept espouses sustainable site design, water conservation and quality, indoor environmental quality, and conservation of materials and resources, among others. The common objective of the above elements of green building is to reduce the overall impact of the built environment on human health and the natural environment.
This underscores the urgency with which the country’s Energy Transition Plan needs to be implemented. Now, more than ever, President Tinubu must ensure timely and aggressive implementation of Nigeria’s Energy Transition Plan which is anchored on the two pillars of reducing emissions and powering development with the target set for 2060.
The ETP promises to create 340,000 jobs by 2030 and up to 840,000 jobs by 2060 driven mainly by the power, cooking, and transportation sectors.
Arc. Bernard Yisa wrote from Abuja, ([email protected])