Nigeria

Messages around climate change and the energy transition by Nigeria’s executive branch remain ambiguous with a strong focus on continuing oil and gas development after the election of President Bola Tinubu in February 2023.

Similar to his predecessor, President Tinubu has given mixed messages on energy priorities. While he has acknowledged the need to reduce reliance on the oil and gas sector and develop solar power, he has also expressed support for increased oil and gas production for domestic consumption and export. Whilst Nigeria’s policies and targets represent a fair contribution to limiting global warming with its own resources, to actually reduce emissions to a level consistent with 1.5ºC it needs to decarbonise its economy and will require international support to do so. Overall, the CAT rates Nigeria’s climate targets and policies as “Almost sufficient”.

The Energy Transition Plan (ETP) to achieve net zero by 2060, considered in our planned policies scenario, requires significant international support. The government aimed to secure an initial USD 10 billion support package ahead of COP27 to kickstart implementation, but has not secured financing as of May 2023.

Nigeria has adopted new measures and announced plans to reduce emissions:

• In January 2023, Nigeria adopted new Methane Guidelines that include mandatory measures for oil and gas companies, such as leak detection, to reduce methane emissions from the oil and gas sector.
• Under the 2021 Climate Change Act, the government is required to develop a carbon tax and carbon trading. In February 2023, the Director General of the National Council on Climate Change announced plans to unveil a carbon tax policy.

While these are positive developments, the government’s continued reliance on oil and gas risk locking Nigeria into emissions-intensive infrastructure. This will likely lead to the major stranding of assets and misallocation of investment resources and continue to drive up national emissions. To meet its net zero ambitions, Nigeria could:

• Pursue a more rapid uptake of renewable energy, rather than the delayed approach put forward in the Energy Transition Plan that relies on rapid expansion of gas in the near-term.
• Move ahead with implementing the Climate Change Act and clarify elements of the net zero target, such as emissions coverage and the role of carbon removals.
• Avoid locking in to high-emission fossil gas infrastructure projects, such as the Nigeria-Morocco gas pipeline and additional LNG export capacity. With uncertainty in long-term fossil gas demand, these investments are at risk of becoming stranded assets.

According to the IEA, no new oil or gas field development is needed to reach net zero emissions (NZE) in 2050. The IEA’s 2022 update of its NZE scenario indicates that African oil and gas production needs to decline by 41% and 13% below 2021 levels by 2030 respectively, and 82% for oil and 78% for gas by 2050. In other words, expanding the availability of oil or gas in Nigeria or anywhere else in the world is inconsistent with limiting warming to 1.5ºC and achieving net zero emissions by 2050.

The CAT rates Nigeria’s climate targets and policies as “Almost sufficient”. The “Almost sufficient” rating indicates that Nigeria’s climate commitments are not yet consistent with the Paris Agreement’s 1.5°C temperature limit but could be with moderate improvements.

Nigeria’s unconditional target meets its fair share contribution to limit warming to 1.5°C; however, its conditional target is consistent with 2°C of warming when compared to the level of climate action needed within the country.

While Nigeria’s policies and action are 1.5°C compatible when compared to its fair share contribution, they are not on track when compared to the level of climate action needed within the country to meet that warming limit. Nigeria needs additional support to implement additional policies and to strengthen and meet its conditional target.

Our ratings are based on a historical emissions time series constructed using government data for consistency with government planning and dialogue, but it's important to note that government-reported emissions are significantly lower than international sources, largely due to the differences in estimates for energy sector emissions. Our ratings may change in the future if there is a significant revision to emissions data.

The CAT estimates that Nigeria’s greenhouse gas emissions would reach 34-43% above 2010 levels excluding LULUCF in 2030 under current policies and including the impact of COVID-19.

In August 2022, Nigeria released its Energy Transition Plan (ETP), put forward as the key strategy to achieving its 2060 net zero target; however, the plan relies on significant action after 2030. Former President Buhari has declared the period to 2030 the “Decade of Gas”. As Nigeria is currently seeking international support to kick-start implementation of the ETP, we have included it in our planned policies scenario rather than in our current policies scenario.

Nigeria’s current policies are rated 1.5˚C compatible when compared to its fair share contribution from its own resources. The “1.5˚C compatible” rating indicates that Nigeria’s climate policies and action are consistent with limiting warming to 1.5°C.

While Nigeria’s policies and action are consistent with a fair contribution to climate action, they do not put Nigeria on track to meet either of its targets. These policies are also inconsistent with the level of emissions cuts needed to limit warming to 1.5°C. Implementation of the ETP, reflected in our planned policies scenario, would put Nigeria on track to meets its unconditional target, but not its conditional target. Nigeria will need to implement additional policies with its own resources to meet its unconditional target, but will also need international support to implement policies in line with full decarbonisation to meet and exceed its conditional target.

Key steps to reducing the gap between current policies and Nigeria’s NDC targets include progressing towards and ramping up its renewable energy target and halting the expansion of natural gas.

In its 2021 NDC update, Nigeria committed to reducing emissions by 47% below BAU by 2030, conditional on international support. This is equivalent to an emissions level 1% above to 23% below 2010 levels by 2030 excluding LULUCF. While this is a strong conditional target, Nigeria will need to strengthen its policies to make sure it has the enabling conditions in place to meet the target, in addition to receiving international support.

The CAT rates Nigeria’s 2030 conditional target as “Almost sufficient,” a rating that indicates that Nigeria’s conditional NDC target in 2030 is not yet consistent with limiting warming to 1.5°C but could be, with moderate improvements. If all countries were to follow Nigeria’s approach, warming could be held below—but not well below—2°C.

Nigeria’s conditional target spans the CAT’s "Almost sufficient" and 1.5°C compatible ratings. The large target range is due to uncertainty around the extent to which Nigeria plans to rely on the land sector in meeting its target. Further clarity from Nigeria on this may result in a 1.5°C compatible target.

In its 2021 NDC update, Nigeria recommitted to unconditionally reducing emissions 20% below BAU by 2030. This is equivalent to an emissions level of 17-27% above 2010 levels (excl. LULUCF) by 2030. The CAT rates Nigeria’s 2030 unconditional target as 1.5°C compatible.

The “1.5°C compatible” rating indicates that Nigeria’s unconditional NDC target is consistent with limiting warming to 1.5°C. Nigeria’s unconditional NDC target does not require other countries to make comparably deeper reductions or greater effort, and is in the most stringent part of its fair share range.

The fair share literature for Nigeria is sparse and some equity categories have few data points. As a result, the upper bound of Nigeria’s fair share range is dominated by a handful of studies. This high range is not reflective of the majority of the literature, which indicates more stringent emission reductions. Future equity studies may help to improve the fair share analysis for Nigeria.

In November 2021, Nigeria passed the Climate Change Act that seeks to achieve low greenhouse gas emissions, green and sustainable growth by providing the framework to set a target to reach net zero between 2050 and 2070. At COP26, former President Buhari further committed to net zero emissions by 2060, which would be in line with the Climate Change Act.

Nigeria’s Energy Transition Plan, released August 2022, was developed to serve as the pathway towards achieving the 2060 net zero target. As the Act only sets the framework for adopting a net zero GHG target between 2050 and 2070, the final net zero target could improve on several elements. In particular, the target should clarify emissions coverage and the role of carbon removals in achieving the target. We evaluate the target design as “Average”.

The full net zero target analysis can be found here.