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New Energy World magazine logo
New Energy World magazine logo
ISSN 2753-7757 (Online)

Nigeria pushes for switch to clean cooking, despite energy market challenges

31/7/2024

8 min read

Feature

Man standing next to fuel pump, holding pump nozzle and filling a gas cylinder with LPG Photo: Samuel Okocha
At a fuel station in Abuja, an attendant fills a gas cylinder with LPG

Photo: Samuel Okocha

The release of a National Clean Cooking Policy in Nigeria in April 2024 is poised to impact the energy sector and environment of West Africa’s dominant country. Designed to offer clean cooking systems to the 30 million households in Nigeria that currently burn wood in their kitchens, it could transform the economy of Nigeria and West Africa, write Samuel Okocha, Andreia Nogueira and Keith Nuthall.

Nigeria has Africa’s largest population (218 million out of 1.2 billion continent-wide) and its largest economy (GDP of $477bn out of $3.1tn).

 

The new policy would see Nigerians end the inefficient and traditional burning of firewood using three-stone and metal tripod stoves, replacing it with better cooking technologies, of which LPG would be the most dominant, serving 54% of the population. This would be followed by biofuels (20%), fuel efficient biomass stoves (which could use firewood, but in a less polluting way; 13%), industrial briquettes (5%), electricity (5%) and biogas (3%).

 

The plan says the government should tell Nigerian LPG producers to prioritise supplying the domestic market, help smaller suppliers access LPG intervention funds, establish cylinder testing plants across Nigeria, and create LPG micro-distribution centres around residential areas. It also recommends expanding awareness campaigns on switching to LPG and mandating government institutions to use LPG for cooking. In addition, the plan suggests that the government should remove VAT on imported LPG and provide tax rebates for imported LPG cooking equipment.

 

The policy paper stresses that open fire smoke kills 77,000 Nigerians annually, and is wasteful, with 90% more wood burned than needed for cooking heat. Moreover, harvesting wood causes deforestation and climate change. But the policy paper is clear about the challenges: ‘Achieving universal access to clean cooking fuels and technologies by 2030, and net zero emissions from cooking by 2060, requires a seismic shift in policy.’ However, the current situation has been underpinned by weak government policies, poor supply chains, poor stove quality, limited consumer choice and lack of finance.

 

Nigeria’s Minister of State for Petroleum Resources (Gas) Ekperikpe Ekpo said in May that the government plans would involve converting 250,000 houses a year to clean cooking gas by 2030, which he claimed was ‘a lofty but attainable target’. Ekpo spoke while distributing free cooking gas cylinders to rural women in the Nigerian capital Abuja as part of the government’s clean cooking campaign.

 

‘This programme is evidence of our steadfast dedication to lessening the over-reliance on solid fuels, which for a long time served as many households’ primary source of energy and include firewood, kerosene and charcoal,’ he said.

 

Cooking technology has been identified as a key development step for Africa by the African Development Bank (AfDB). On 15 May 2024, the AfDB President Dr Akinwumi Adesina said his institution would commit 20% of all its financing of energy projects towards promoting safe cooking – which amounts to $2bn over 10 years. The Bank estimates that $4bn/y is needed to give most African families access to clean cooking by 2030.

 

A 2023 AfDB and International Energy Agency (IEA) report stresses how Nigeria’s aim would comply with the UN Sustainable Development Goal (SDG) of accessible energy for all by 2030. It argues that private/public funding could seed major growth.

 

'More financing would help make the clean cooking sector a more attractive and vibrant investment opportunity through innovative financing solutions and mechanisms’, says the study.

 

The need for private/public funding has also been highlighted by a Nigeria Clean Cooking Forum: ‘The private sector in the clean cooking industry requires [public] interventions to enhance value chain development, balanced product supply and demand, technology innovations and knowledge transfer for a seamless transition to carbon-neutral cooking,’ it said in a statement.

 

Work to do
The government certainly has work to do. Despite Nigeria’s huge gas reserves of 202tn ft3, only 16% of its people had access to clean cooking solutions in 2021, according to the International Renewable Energy Agency (IRENA).

 

Bahago Kashema, Economist and Research Associate at the Centre for the Study of the Economies in Africa (CSEA), welcomes the government plan, but remains sceptical about its impact. ‘It’s a good idea. But I don’t expect much from what I’m seeing right now,’ he says candidly.

 

The IEA's Lead Energy Access Analyst Gianluca Tonolo comments: ‘Even if there are some markets and households that are easier to reach, like in cities... where people have a more steady income, the bulk of the population are very difficult to reach due to economic and cultural reasons.’ He adds: ‘Many people, especially in rural areas... are not aware of the benefits in terms of health or time saved, and they like cooking the way they have been making meals traditionally.’

 

He praises the clean cooking awareness campaigns in schools in rural areas.

 

‘Strong, focused subsidies... for the short-term’ can push change, but only with ‘a longer-term plan to solve the problem from the roots’, he adds. He suggests innovative business models and reforms, such as systems that allow people to refill smaller amounts of LPG instead of refilling a whole bottle. He also stresses the importance of integrating clean cooking plans with other development programmes, addressing the affordability issue bottom up. He adds that carbon markets can also help, ‘since there is this climate benefit’, with clean cooking solutions entitled to carbon credits, ‘which means an additional source of financing’.

 

‘Many people, especially in rural areas... are not aware of the benefits in terms of health or time saved [of clean cooking], and they like cooking the way they have been making meals traditionally.’ – Gianluca Tonolo, IEA Lead Energy Access Analyst

 

Infrastructure weaknesses
Kashema says Nigeria’s energy sector faces critical challenges to improve its operations, with infrastructure weaknesses, especially in gas storage and distribution networks, posing significant obstacles to clean cooking goals.

 

He also stresses that policies mandating gas sales to the local market may not be favourable in terms of pricing.

 

Tonolo adds that outside urban areas, where population densities are low, companies ‘need to build logistics infrastructure to make sure this works, as satisfying a low demand with such low density, the investments can become too expensive’. He also advocates transitional and long-term solutions, including electric cooking: ‘In such cases, we can have a transitional solution such as improved biomass stoves while we plan to bring stable electricity.’ He adds that, for now, Nigeria has a very weak grid, so electric cooking, even in urban areas, is not a short-term mass solution.

 

That said, taking into account Nigeria’s 218 million population and current low LPG penetration, there are investment opportunities, according to Lanre Runsewe, CEO of Lagos-based gas trading and infrastructure company Rungas Group.

 

Given this major market and ‘the fact that half of LPG consumed in Nigeria is imported, the opportunities to invest in value-chain, from production to consumption, are significant,’ he comments. Runsewe believes Nigeria is ready to make the shift to cooking gas following the Climate Change Act signed into law in 2021, and the Energy Transition Plan launched in 2022.

 

‘Switching to LPG in a first phase before scaling up electrification and biogas is a key national strategy for providing cleaner energy and preserving the country’s forests,’ he says.

 

Also, with oil majors now interested in Africa clean cooking (including TotalEnergies and the Nigeria-based oil and gas company Sahara Group), corporations are investing in infrastructure for importing LPG, for storing and refilling stations, also for distributing LPG to the final consumers, observes the IEA’s Tonolo.

 

He also sees ‘a lot of methane flaring in Nigeria’s oil and gas production that could be recovered to also produce LPG for cooking or for producing electricity’.

 

Moreover, data reveals a gradual increase in Nigerian use of clean cooking fuels, particularly LPG. ‘Since the mid-2000s, LPG consumption has grown on the back of increasing imports and new domestic supply sources from Nigeria LNG,’ says Runsewe.

 

However, he notes Nigeria’s ongoing cost-of-living crisis is impacting the growth of the cooking gas sector, with moderate GDP growth (projected to be 3.3% this year – 2024) and inflation (33.9% in May) stagnating consumer demand since 2020. ‘Programmes must be put in place to address affordability constraints, starting with the cost of procuring cylinders and LPG equipment,’ says Runsewe.

 

Prices for cooking gas in Nigeria rose 13.75% in May (2024) from the previous month, according to data from Nigeria’s National Bureau of Statistics. The average retail price for refilling a 5 kg cylinder increased to Nigerian Naira NGN 7,418 ($4.84) from NGN 6,521 in April (2024), up 70.12% year-on-year.

 

To ensure this clean cooking demand growth is sustainable, economic empowerment is pivotal, says Kashema. ‘You can’t talk about clean energy without addressing poverty. When people are economically empowered, they are more likely to adopt clean energy solutions for cooking and powering their vehicles.’

 

One concern about supply and demand for alternatives to traditional cooking methods is the removal of fuel subsidies by President Tinubu when assuming office in May 2023, tripling petrol pump prices, but these were replaced by price caps by December 2023 following protests.

 

Tonolo says infrastructure investments should be a priority: ‘We will need to build a lot of networks in the cities to bring natural gas to homes. In low-density populated and in rural areas this would not make economic sense in many cases.’

 

Biogas
Tonolo adds that another alternative with potential is biogas, which can be a profitable investment for farmers. Bioethanol is also an option because ‘it is a safer product’ compared to LPG, and can be sold directly at local stores, he continues. The IEA projects that biogas and bioethanol can cover more than 10% of the population’s switching to clean cooking solutions in Africa.

 

Overall, while Nigeria’s plan to switch to gas cooking faces significant challenges, experts like Kashema believe that with the right investments, partnerships and awareness campaigns, the country can make significant progress in reducing its carbon footprint, improving public health.

 

‘We foresee a continued growth in demand, especially if the macroeconomic outlook improves,' adds Runsewe of Rungas. ‘As demand parameters remain strong, the private sector will continue to invest in storage and distribution infrastructure, and seek to articulate programmes that make it easier for consumers to access gas.’