Okereke: Climate Change May Cost Nigeria $460bn by 2050


Prof. Chukwumerije Okereke, is a member of the Intergovernmental Panel on Climate Change of the United Nations, as well as a professor in environment and development at UK’s Reading University. In this interview, he speaks on the outcome of a recent continent-wide research on climate change, green economy and renewable energy he carried out under the platform of the Governing Inclusive Green Growth in Africa Research Network. Chineme Okafor presents the excerpts:

What were the findings from your recent research on the green economy of four African countries, Nigeria inclusive?

My team looked at the state-of-play of green economy policies and projects in Africa with a focus on four African countries including Ethiopia, Kenya, Nigeria, Rwanda, and South Africa. We analysed several polices and over 503 green projects across Africa and made several important discoveries.

We found that many African countries are beginning to understand the role that green economy can play in the purist of sustainable economic development while improving resource efficiency and avoiding the pollution and environmental degradation in the continent. An increasing number of the heads of state and ministers I speak with seem to appreciate that African countries must now seek to reduce their dependence on crude natural resource exploitation which has provided the thrust for much of the economic growth recorded in previous decades as this type of economic growth is not really sustainable in the long run.

Crucially, many countries are beginning to understand that it is possible for Africa to increase their economic competitive advantage by harnessing the abundant renewable resources such as solar radiation, wind and geothermal to address the pervasive energy poverty in the continent. Given the amount of renewable energy resource available in Africa, it is something of an oddity that up to 650 million people in sub Saharan Africa do not have access to modern electricity.

The green economy offers opportunities for countries to change this story and to creatively link their national development activities with efforts to fight against climate change and inequality. There are good examples such as Ethiopia’s light rail project which is powered by 100 per cent renewable energy, and the zero liquid discharge Hawassa Industrial Park which is expected to employ 60,000 people at full capacity and generate export revenue amounting to one billion US dollars for Ethiopia.

Africa is beginning to wake up in this area but there is still quite a long way to go. The main problem is that for some countries, such as Nigeria, the green economy remains a niche and marginal idea which is not fully integrated into the core aspect of national economic development plans and programs.

Other challenges include lack of finance, technical capacity, and the absence of political will needed to make the transition to the green economy. For example, despite some important steps and programs in Nigeria, the country still does not have a coherent national green growth policy and strategy similar to what we have in Ethiopia, Rwanda and South Africa.

Part of the research showed that Nigeria isn’t a chief destination for climate change and renewable energy financing by OECD countries, why is it so and what can be done about it?

Actually compared to population and GDP, Nigeria is performing very poorly in attracting international climate finance. I have been crying loud about this for over five years now. South Africa, Rwanda, Ethiopia and many other countries are performing better than Nigeria in this regard and this really is not acceptable. There are many reasons. Nigeria is too focused on the oil money and are not aggressively looking for opportunities elsewhere. Political will is weak and the prevailing institutional structure is inadequate. In our research, we found, that Nigeria is the only country among the five countries we analysed which does not have a strong and coherent national green growth plan and a strategy. This means there is no clearly elaborated goals and plan for attracting global climate finance.

I am also sad that due to lack of understanding of the opportunities and poor planning, Nigeria has not been smart enough to package some of the national projects that are being undertaken which have emission reduction potential in such a way that they can attract climate finance. One example, the Abuja light rail project if properly packaged could be a candidate for climate finance since it will take many cars out of the road and result in the reduction of millions of tonnes of CO2 emissions.

At the same time, let us not forget that according to some sources, climate change could cost Nigeria between six per cent and 30 per cent of its GDP by 2050. This amounts ranges from $100 billion to $460 billion by 2050. So, you see, there is a need for strategic focus on designing major projects on renewable energy, smart agriculture, sustainable land management, livestock, irrigation, flood control measures that can attract funding from the Green Climate Fund and other sources of climate finance.

Nigeria needs to urgently strengthen its National Designated Authority and other relevant institutions that can work to increase its ability to plan and design bankable projects as well as to understand the processes for obtaining international finance. Such a body will also help to ensure that whatever fund received is effectively managed.

Does it then mean efforts by regulators and others aren’t attractive to investors?
First it is important to note that renewable energy is one of the fastest growing sectors in the world. In the UK, for example, the amount of renewable capacity has tripled in the past five years to the point that renewable capacity overtook fossil fuel capacity for the first time earlier this year. There are several public and private entities that are looking for conducive environments where they can invest in renewable energy in Africa.

Right now, the International Renewable Energy Agency (IRENA) and the Abu Dhabi Fund for Development (ADFD) have committed $350 million on a joint project facility to support replicable, scalable and potentially transformative renewable energy projects in developing countries. Other donors and international development partners such as the UK, The World Bank, the African Development Bank and a host of other private actors have programmes designed to support renewables energy investment in Africa. The key hindrance to renewable energy investment in Nigeria and indeed other African countries is the absence of the right regulatory climate for attracting international investment. The policies are not advanced and coherent. There is much more to do in terms of reducing the capital cost, lowering the barrier to investment, land use planning, domesticating technologies, and changing the misconceptions about distributive energy.

My advice to the government is to constitute a high level independent multi-stakeholder forum to help institutes to think through the mix of strategies and policy reforms needed to unlock public and private investment in renewable energy in Nigeria. Some of the key planks will include greenhouse inventory, energy efficiency standards, quotas and obligations, technology investments, subsidies, grants, rebates, accreditations, etc.

Here, I would like to stress, that in pursuing this goal, attention must be given to the need to encourage local entrepreneurs who are already investing in renewable energy in Nigeria. I have said many times before that we cannot import ourselves out of poverty and into sustainability. The promotion of indigenous technology incubation, innovation and diffusion must also be central aspects of our renewable energy strategy. This is why I am working intensively with the Federal Ministry of Science and Technology to access and categorise the technical capacities needed in Nigeria and especially by the ministry to help midwife sustainable renewable energy revolution in Nigeria.

In 2017, you told THISDAY that Nigeria’s coastal states were at the risk of been washed away on account of rising sea levels as climate change happens, how riskier is this in 2018 since we’ve seen flooding in different parts of the country over the years?

As you know the Intergovernmental Panel on Climate Change (IPCC) of which I am a lead author has just released a new report on the impact of climate change at 1.5 0C global warming. It is very disappointing that despite all the talk and raft of polices at global and regional levels, the rate of global greenhouse gas emissions continues to rise. In fact, earlier in April, this year, the Mao Lao Observatory in Hawaii posted the highest monthly average concentration of CO2 ever recorded in history.

The summary is that things are actually getting worse. This mean that the threat of climate change impact to our coast and other key sectors such as infrastructural investment and agricultural production, which I spoke about last year, is actually growing. Again, I am urging the government to wake up and take very seriously the risks imposed by climate change which has been described as the greatest development challenge facing African countries.
How do you think the impact of climate change can be made obvious to governments and citizens?

There are two main interconnected reasons. The first one is the lack of detailed and rigorous research that maps the impact of climate change on key economic sectors such as agriculture, health, energy, etc. There is an urgent need for Nigeria to invest in boosting significant research capacity on the science, economics and social dimensions of climate change. One of the interesting discoveries made by my team was that well over 70 per cent of international standard journal publication on climate in Africa comes from South Africa. And, we are supposed to be the giant of Africa, right?

Linked to the lack of high quality science is the lack of effective communication of climate change by the media. People sometimes tend to forget that climate change is not so much about models and scenarios; it is much more about the everyday impact on our lives. It is about increasing drought, loss of crop yield, famine, floods and erosion. It is about our sisters, mothers and wives having to travel much longer to fetch fire woods. It is about increases in malaria incidence and associated loss of productivity. It is about internal and international security. For example, many of us have spoken about the close links between climate change, the drying up of Lake Chad and the worsening clash between cattle herdsmen and farmers in the middle belt region of Nigeria. Keep in mind that despite the server and manifold threats of climate change to our fragile economy, Nigeria is yet to commission a national report that will explore these issues in detail and communicate the message in ways that will capture public imagination and stimulate the much needed national discourse on the subject.

Talking about climate change resilient and green economy, how far is Nigeria from getting it right?

There are a number of activities here and there. One example is the green bond that has raised about N11 billion. We also have the special clime unit that has been elevated to the full department of climate change in the ministry of environment. Nigeria has submitted two national climate communication and its Nationally Determined Contribution (NDC) which pledges an unconditional contribution of 20 per cent below business-as-usual (BAU), consistent with current development trends and government policy priorities, and a 45 per cent reduction conditional on international support. There is also a statement of commitment to generate 30 per cent of our energy from renewable by 2030.

However, significant gaps exist between the Economic Recovery and Growth Plan (ERGP) of the government and the Nationally Determined Contributions (NDC). Nigeria’s ERGP identifies five sectors including transport, agriculture and land use, industry, services, and energy as engines for economic growth. However, these sectors, charged with stimulating inclusive and non-inflationary growth, are also major sources of Green House Gas (GHG) emissions. Nigeria’s Economic Recovery and Growth Plan (ERGP) proposes to use the country’s vast natural resources to catalyse economic recovery. But promoting growth through depletion of resources could place an additional burden on the GHG inventory, and the inability to meet this commitment will further derail political and economic development. Preliminary investigation seems to suggest that the NDC did not take into consideration growth objectives, since 20 per cent unconditional mitigation will reduce the carbon intensity by 2020 but cannot drive the Vision 20:2020 goal. The challenge now is to come up with a plan that reconciles the ERGP with the NDC.

Off grid electricity is gaining some traction in Nigeria at the moment, are we on the right track?

Yes, there are important developments but I do worry that the strategy is not clear and coherent. We do need to examine the policy to ensure that we are on the right direction. I would like to see stronger focus on technological diffusion and leapfrogging, as well as a strategy to grow local innovation in this area. We need an integrated plan and framework that covers training, capacity building, local innovation, job creation and support for local entrepreneurs.

Crucially we need to direct our attention to how best to use renewable energy to stimulate agricultural production and boost our agro-allied industry. Look, the main reason for energy should not just be to put on another light bulb which seems to be much of the focus now. Rather, the start move is to think about how you can boost industrialisation and economic growth through the instrumentality of renewable energy. This was the focus of the recent work we did in Ethiopia and there are lessons for Nigeria in this regard.

Where lies the strength for Nigeria in the entire green economy conversation, especially with her rising population and dwindling public sector resources and finance?
Nigeria faces a grave risk. Danger lies ahead if it continues on the track and with the pace it is going. First, Nigeria is one of the most vulnerable countries to climate change and the treats to agriculture, food production, heath, are all increasing. Second, from 2005 a growing list of countries have announced that they will ban the sale of passenger vehicles powered by fossil fuels such as gasoline, LPG and diesel. Examples include the United Kingdom, Germany, China and the Netherlands. This year one million electric vehicles were sold in the US and four million were sold globally.

The question that few people are asking is who will buy our oil in 2030 if the growing electric car revolution takes hold across the globe. I have read the key document of the main political parties closely, and I am sorry that I have not seen serious thinking about how to diversify our economy away from oil and how to reposition the economy to take full advantage of the opportunities offered by the green economy. Make no mistake, the next wave of industrial revolution is already well underway and renewable energy will be a central aspect of that wave. The simple but bitter truth is that if Nigeria fails to think ahead and innovate and make the necessary changes now, we will suffer devastating consequences. I hope this will not be our story.