Moving beyond fossil fuel in an oil-exporting and emerging economy: Paradigm shift

Abstract

The next transformation in human civilization is occurring in the energy sector. The transition is supported mostly by concern for environmental safety (climate change). Other factors such as energy security and economics also dictate the shift. The transition will be more disruptive to oil-exporting economies such as Nigeria, which depend heavily on it for economic growth. Historical inferences from past energy transitions reveals that discovery and massive acceleration of new energy resources alters mode of production, energy consumption, economic innovation and unlocks multiplier effects on the society. Technology and availability of energy resources is the critical enabler of past transitions. Renewable energy technologies are becoming more cost-competitive relative to fossil fuels. The increasing transition will have serious socioeconomic and political implications, if the country does not diversify its economy. For example, contraction in oil export because of global transition to renewable energy will reduce Nigeria government's revenue, increase unemployment, decrease capacity to finance infrastructure and development projects, and increase poverty rate. Nigeria has enormous renewable energy potential—solar, wind, biomass, etc. The use of renewables will improve environmental quality. For example, increased use of biomass (organic wastes) for energy production will advance Nigeria solid waste management system and vice versa. All these are associated with sustainable resource management.

Keywords

• energy transition
• renewable
• fossil fuels
• climate change
• energy efficiency
• economic diversification
• economic growth
• sustainability
• nigeria