Renewable Energy Adoption in Nigeria: Barriers to Implementation and Opportunities for Growth

By: Johnson Nchege E., Michael Oguwuike Enyoghasim, Ogbonna Nkemdirim Jennifer

Pages: 84–99, Volume: 2, Number: 2

Published by: AEFUNAI Journal of Economics, Finance and Development Studies, Alex Ekwueme Federal University, Ndufu-Alike, 9/1/2025, 2025

ISSN (Electronic): 2536-6742

DOI: 10.48028/iiprds/aefunaijefds.v2.i2.05

Renewable Energy Adoption in Nigeria: Barriers to Implementation and Opportunities for Growth

Abstract:

Nigeria’s chronic electricity deficit, less than 4,500 MW of generation against a demand exceeding 30,000 MW, illustrates the urgency of diversifying its energy mix. Despite vast endowments in solar, wind, biomass, and hydropower, renewable energy contributes under 10% of supply as of 2024, leaving 40% of the population without reliable access. This study provides one of the most comprehensive analyses of Nigeria’s renewable energy transition by integrating econometric modelling with qualitative evidence from policy reports and stakeholder perspectives over 2010–2023. We quantify both barriers to and opportunities for renewable energy adoption, addressing a persistent gap in the literature that has largely overlooked socio-political and cultural dynamics. Descriptive statistics reveal that renewable adoption averages only 5.65% (SD = 2.96) of total energy supply, with electricity access averaging 57.6%. Econometric analysis shows that GDP growth (β = 0.25, p < 0.05), public awareness (β = 0.35, p < 0.01), and technological advancement (β = 0.42, p ≈ 0.06) significantly drive adoption, together explaining 56% of variation (R² = 0.56). Conversely, political stability, while theoretically critical, exerts no significant effect, highlighting structural weaknesses in governance and regulatory institutions. Growth opportunities emerge in foreign direct investment (FDI) (β = 0.05, p < 0.05) and electricity access (β = 0.50, p < 0.05), with the growth model explaining 62% of variance (R² = 0.62). Yet less than 20% of FDI currently supports renewable energy projects, limiting their transformative potential. Our findings underscore that Nigeria's renewable energy transition is constrained by regulatory inconsistencies, weak governance, and misaligned investment Eows, but retains significant potential if reforms are implemented. Strengthening policy coherence, redirecting FDI, enhancing public sensitization, and prioritizing rural electrification, particularly off-grid solar, are decisive for accelerating adoption. These pathways not only promise improved energy security and industrial competitiveness, but also enable Nigeria to meet its Paris Agreement commitments and position itself as a regional leader in sustainable energy transitions.

Keywords: Renewable energy, Energy transition, Sustainability, Barriers to adoption, Nigeria