Nigeria’s energy landscape is undergoing a significant transformation as the country pivots towards renewable energy sources. This shift comes in response to ongoing challenges within its oil industry, which has struggled with mismanagement, insufficient infrastructure, and rampant oil theft. With a vision for a more sustainable energy future, Nigeria aims to diversify its energy portfolio and enhance energy security.
The oil sector has been riddled with issues, including widespread theft and illegal export networks. A committee formed earlier this year highlighted these challenges in a report, revealing that Nigeria experienced at least 589 oil leaks in 2024, primarily due to theft and sabotage. The Nigeria Extractive Industries Transparency Initiative reported that over the past 12 years, the country lost approximately 619.7 million barrels of oil, equating to a staggering $46.2 billion in potential revenue.
Nigerians are increasingly advocating for a shift from oil to cleaner energy alternatives. In response, the government has set ambitious targets, including achieving net-zero carbon emissions by 2060, announced during the COP26 climate summit. The Energy Transition Plan (ETP), which led to the enactment of the Climate Change Act in 2021, aims to address emissions across various sectors, including power, transport, and industry.
The ETP has been designed to create job opportunities, with projections of 340,000 jobs by 2030 and 840,000 jobs by 2060. To facilitate this transition, Nigeria recognizes natural gas as a crucial transitional fuel while simultaneously working to establish new green energy industries.
During the recent Nigeria Renewable Energy Innovation Forum 2025, the government signed contracts valued at $435 million to enhance the nation’s renewable energy capacity. These agreements are anticipated to generate approximately 1,500 direct jobs. State governments are also collaborating with local and international companies to develop solar and hybrid projects to bolster power generation.
Vice President Kashim Shettima emphasized the urgent need for investment, stating that $23 billion is required in the short term to provide reliable electricity to millions of Nigerians currently lacking access. To attract more investment, the government is incentivizing local production, streamlining regulations, and promoting public-private partnerships.
Nigeria’s solar power industry has witnessed considerable growth in recent years, leveraging the country’s abundant sunlight. In October, Nigeria’s Energy Commission entered into a strategic partnership with the Chinese solar manufacturer LONGi to establish a solar panel plant with a production capacity of up to 1 GW. Earlier in September, the Rural Electrification Agency (REA) partnered with the Infrastructure Corporation of Nigeria and the Dutch manufacturer Solarge BV to launch a solar panel manufacturing initiative.
Furthermore, in March, the REA signed a deal with Oando Clean Energy for a 1.2 GW solar assembly plant. The government is also considering a ban on solar panel imports to encourage domestic production. Technology Minister Uche Nnaji highlighted Nigeria’s abundant lithium resources, indicating a move towards adding value to local raw materials.
As Nigeria navigates its oil industry challenges, the government is simultaneously driving investment in renewable energy. This dual approach not only aims to expand the nation’s energy capacity but also seeks to foster economic growth through enhanced manufacturing capabilities. By prioritizing renewable energy, Nigeria is positioning itself for a sustainable future while addressing the pressing issues of its oil sector.
