Study: Nigeria Has Under-performed Market Penetration in Africa
By Chibisi Ohakah, Abuja
Increasing at 22% average annual rate, the Nigerian solar, off-grid market has been placed among the fastest-growing in Africa during the past five years, a study has said.
The study conducted by Boston Consulting Group (BCG) and All-On- a Shell-funded impact investment company, said despite the growth Nigeria has under-performed its peers in Africa in market penetration. The report said indeed the country has a long way to go before its solar market could be considered robust.
The study was conducted to analyze the impact of solar energy implementations on health, education and food security outcomes as well as its effect on the environment and commercial activity in the country.
The study sought to determine the developmental benefits Nigeria has gotten from its limited solar installations and what impact could be achieved from scaled deployment by engaging six different user groups across five socioeconomic dimensions.
“Nigeria’s installed photovoltaic (PV) panel per capita amounts to only about 1 watt compared to an average of 8 watts in similar emerging markets, indicating a big opportunity for further growth in the country (Nigeria). Given the dynamics favouring solar deployment in the country, Nigeria’s PV per capita could reach 5 –8 GW by 2030,” the study said.
For instance, the study discovered that in Nigerian public secondary schools that installed solar equipment, students’ study hours increased by over 200% and the number of Information and Communications Technology (ICT) teaching hours rose by 30%.
In another instance, the survey showed that Nigerian Primary Health Centers (PHCs) with solar electricity nationwide witnessed a 60 to 70% improvement in antenatal care coverage and a 40 to 60% reduction in vaccine waste.
Also, the study showed that farmers that adopted solar-powered cold storage reduced postharvest loss (PHL) for perishable goods by up to 30%. The study further revealed that around 500,000 Nigerian households (1.25% of total households) use solar energy, which resulted in upwards of 160,000 tonnes of CO2 emissions being avoided.
“In markets that have been powered by solar panels in Nigeria, the study found that there is a 20 to 40% increase in operating hours of micro, small and medium scale enterprises (MSMEs) and that they avoided the substantial inventory and sales losses resulting from fires caused by generators,” it stated.
An expert and managing director and partner, BCG (West Africa), and head of BCG Nigeria, Tolu Oyekan, argued that having in place solar power systems in 18,000 primary health centers that have no access to reliable power supply could increase antenatal care coverage from current levels of 50 to 70% of pregnant women and with improved refrigeration vaccine wastage would be reduced by as much as 20%.
In his thinking also, providing solar power to about 1,200 public boarding schools would increase average student study hours nationwide, from about 8 hours to 18 hours per week and improve ICT teaching hours by as much as 60%.
“Based on current solar-powered cold storage adoption data, by electrifying 600,000 Nigerian farmers who currently don’t have cold storage facilities PHL could be slashed by as much as 60%, producing enough additional food to feed 6.5 million people annually.
“Assuming solar penetration among households in Nigeria reaches peer nation average of about 30% by 2030, an additional 5 million tonnes of CO2 can be avoided as emissions from households would be reduced by nearly 30%.
“Deploying solar to around 15 to 20 million MSMEs in markets without reliable grid electricity could increase income at these companies by $7 billion to $10 billion, some 40 percent of annual MSME earnings,” Oyekan said.
The study by BCG and All-On discovered that improvement in access to capital for consumer solar purchases, simplified import policies and skills development are necessary for desirable penetration of solar power service in Nigeria.