Stakeholders and economic analysts have raised concerns over the alleged plan by the federal government to ban importation of solar panels.

Daily Trust reports that the federal government has unveiled plans to prohibit the importation of solar panels, in order to support local manufacturing and expedite the nation’s shift toward clean energy solutions.

This also aligns with Presidential Executive Order No. 5, which prioritises local content in the science, engineering and technology sectors.

Minister of Science and Technology, Uche Nnaji, stressed Nigeria’s capacity to produce its own solar panels, with the National Agency for Science and Engineering Infrastructure (NASENI) playing a key role in local manufacturing.

“We have lithium in abundance here in Nigeria, so Mr President is already taking action. We are adding value to our raw materials. The lithium we have here will be processed and used as batteries for vehicles,” he said.

But experts say the plan poses a threat of operational disruptions to startups that have invested in solar energy solutions.

The Centre for the Promotion of Private Enterprise (CPPE) on its part expressed concern about the statement credited to the minister while strongly advising against the policy proposition.

Giving reasons for this, the Director/CEO of the CPPE, Dr Muda Yusuf, noted that currently, Nigeria has one of the worst energy accesses with a per capita electricity consumption of about 160kWh, far below the sub-Saharan average of 350Kwh.

According to him, the adoption of the solar energy solution “is one of the most impactful government initiatives to tackle this problem and it has gained remarkable traction.”

The CPPE stated that a ban on the importation of solar panels in the face of glaringly inadequate domestic production capacity would worsen the country’s energy crisis.

It would worsen energy access

Dr Muda stated that it is a complete negation of the government policy to deepen and promote the adoption of renewable energy solutions by households, small businesses, rural communities and government institutions and other corporate organisations.  This adoption of solar solutions has gained an impressive momentum in the last two years, especially in light of the soaring energy cost in the economy.

The statement added, “It would worsen the problem of energy access as it would make the cost of solar energy solutions prohibitive, putting it beyond the average Nigerian.

“The welfare cost of a ban on the importation of solar panels would be incredibly high as a result of the escalation in the cost of acquiring solar solutions.

“It is bad enough that the current cost of acquisition of solar energy solutions is quite exorbitant.  What is desirable at this time is to seek ways to drive affordability, rather than escalate costs.”

The CPPE, however, reiterated that Nigeria “is not ripe for a ban on importation of solar panels given the acute energy deficit in the economy and the glaring domestic capacity limitations for the production of solar panels.”

“The CPPE recommends that the government should rather support investors in the solar panel production with robust fiscal and monetary incentives – tax incentives, tariff concession on intermediate products and concessionary long-term financing at a single-digit interest rate.

“Meanwhile, the CPPE urges the government to cut the import duty on batteries, inverters and wind turbines to 5%.  This would significantly improve energy access, energy security and productivity in the economy.

 

“It would also reduce reliance on the national grid for power supply. The current costs of batteries and inverters are very prohibitive,” the statement added.