Eras of industrial sector energy transition in Nigeria
key drivers - energy service outsourcing, cost reduction and business realignment
secondary data in consumption analysis
grid defection, self-generation, energy outsource and conservation phases
interview of stakeholders
VERY USEFUL PAPER
Osakwe, P.N., 2018. Unlocking the potential of the power sector for industrialization and poverty alleviation in Nigeria. The Service Sector and Economic Development in Africa, 63(83.11), p.159.
combined modelling software; HOMER Energy, Network Planner and GEOSIM
low access rate; less than 40%
comparison with diesel
PV+ESS most viable combination
solution nexus private businesses like
Jin, S. et al. (2018) ‘A Study on Designing Off-grid System Using HOMER Pro - A Case Study’, in 2018 IEEE International Conference on Industrial Engineering and Engineering Management (IEEM). 2018 IEEE International Conference on Industrial Engineering and Engineering Management (IEEM), pp. 1851–1855. doi: 10.1109/IEEM.2018.8607423.
focus on island consumers
used data for Korean Meteorological Information Administration data via EIA
assumed same hourly demand for planning horizon
real discount rate and project lifetime of 1.23% and 20 years respectively
better LCOE from 2 islands out of 3 with PV+Wind+EES+Diesel hybrid compared to diesel alone
good paper but not so deep analysis
Ozoegwu, C.G., 2018. The solar energy assessment methods for Nigeria: The current status, the future directions and a neural time series method. Renewable and Sustainable Energy Reviews, 92, pp.146-159. https://www.sciencedirect.com/science/article/pii/S1364032118302867#!
full and systematic solar resource assessment
solar up to industrial quantity
new model built on existing ones
PV prices dropping
Okundamiya, M. S. and Ojieabu, C. . (2017) ‘Simulation of an Isolated Solar Photovoltaic-Fuel Cell Hybrid System with Hydrogen Storage for Mobile Telecommunication Sites’, Journal of Engineering Science and Applications (JESA), 10, pp. 1–9.
PV price and other systems cost
power supply to isolated telecommunication sites
hybrid of PV and fuel cell storage system
simulation results: ₦40 per kWh energy cost, 13.1% RoI and 12.4% IRR compared to traditional diesel only
6 years discounted payback period for PV/FC versus diesel compare
Halabi, L. M. et al. (2017) ‘Performance analysis of hybrid PV/diesel/battery system using HOMER: A case study Sabah, Malaysia’, Energy Conversion and Management, 144, pp. 322–339. doi: 10.1016/j.enconman.2017.04.070.
scenarios: standalone diesel generators, hybrid PV/diesel/battery and 100% PV/battery
sensitivity along fuel, PV, battery prices, and load or demand growth
scenario comparison
results: Hybrid PV/Diesel/Battery best combination
Policy as drivers for renewable energy development
considers barriers and opportunities of RE development
how RE can bring about social and economic development
Bahramara, S., Moghaddam, M. P. and Haghifam, M. R. (2016) ‘Optimal planning of hybrid renewable energy systems using HOMER: A review’, Renewable and Sustainable Energy Reviews, 62, pp. 609–620. doi: 10.1016/j.rser.2016.05.039.https://www.sciencedirect.com/science/article/pii/S1364032116301496
most considered uncertainties in sensitivity analysis are Wind speed, solar radiation, component cost, fuel price, and primary load
other research have considered effects of real interest rate and grid electricity price aside the most popular variables
two approaches identified for evaluating uncertainties and optimal sizing of hybrid renewable energy systems (HRES) are robust planning (scenario technique) and risk of planning
robust plan is the scenario that give least NPC among others
in base scenario and other scenarios, risk of planning is evaluated through NPC
Eberhard A, Gratwick K, Morella E, Antman P. (2016). Independent Power Projects in Sub-Sahara Africa: Lessons from Five Key Countries. Directions in Development. World Bank.
investment needed for low carbon technologies
adequate electricity as economic booster for Sub-Saharan Africa
policy and concentration shift from biofuel to natural gas
fossil fuel and vandalism
unsustainable current energy - capital cost, fuel price spike, transmission cost, infrastructure
policy uncertainty
renewable and performance risks
Okoye, C. O., Taylan, O. and Baker, D. K. (2016) ‘Solar energy potentials in strategically located cities in Nigeria: Review, resource assessment and PV system design’, Renewable and Sustainable Energy Reviews, 55, pp. 550–566. doi: 10.1016/j.rser.2015.10.154.https://www.sciencedirect.com/science/article/pii/S1364032115012332
standalone PV
long daily duration of diesel generator operation
good overview of energy situation in Nigeria
solar adoption barriers
focus on Lagos, Kano and Onisha
numerical and intuitive methods of PV design and analysis
sensitivity along PV cost, discount rate and battery replacement period
Olatomiwa, L., Mekhilef, S. and Ohunakin, O. S. (2016) ‘Hybrid renewable power supply for rural health clinics (RHC) in six geo-political zones of Nigeria’, Sustainable Energy Technologies and Assessments, 13, pp. 1–12. doi: 10.1016/j.seta.2015.11.001.https://www.sciencedirect.com/science/article/pii/S2213138815000727
national electricity crisis
geo-political RE analysis
technology suitability per area
different tilt angles for PV
estimated load data
hybrid of PV+wind+diesel+battery
hybrid as best result; PV+diesel+battery for South and PV+wind+diesel+battery for north
hybrid COE range 0.32 to 0.68 $/kWh
diesel only COE $0.911/kWh
MISSING ASSUMPTIONS, GOOD PAPER
Serrano-Cinca, C., Gutiérrez-Nieto, B. and Reyes, N. M. (2016) ‘A social and environmental approach to microfinance credit scoring’, Journal of Cleaner Production, 112, pp. 3504–3513. doi: 10.1016/j.jclepro.2015.09.103.
Proposes consideration of social and environmental aspects of loan granting
multi-criteria evaluation of decision making micro-financing of projects
Oladokun, V. O. and Asemota, O. C. (2015) ‘Unit cost of electricity in Nigeria: A cost model for captive diesel powered generating system’, Renewable and Sustainable Energy Reviews, Volume 52, pp. 35–40. Available at: https://www.sciencedirect.com/science/article/pii/S1364032115006759.
cost model for DG
diesel fuel prices and energy cost from DG
captive power generation
L. K. Gan, J. K. H. Shek, and M. A. Mueller, “Hybrid wind–photovoltaic–diesel–battery system sizing tool development using empirical approach, life-cycle cost and performance analysis: A case study in Scotland,” https://www.sciencedirect.com/science/article/pii/S0196890415008651 Energy Conversion and Management, vol. 106, pp. 479–494, Dec. 2015.
introduces a developed system sizing model
uses Gaia’s wind turbine power curve for wind power generation
I-V characteristics with solar irradiations for PV generation
diesel fuel consumption 0.28 - 0.4 L/kWh
historical fuel price for future price
falling O&M cost over 20 years (subsection 4.1)
balance configuration with battery and diesel genset
load sensitivity
storage preferred to diesel gen
LCOE optimal solution from sensitivity; PV-diesel > wind-diesel > PV-wind-diesel
future work recommendation: complex modelling and hardware testing
L. Olatomiwa, S. Mekhilef, A. S. N. Huda, and O. S. Ohunakin, “Economic evaluation of hybrid energy systems for rural electrification in six geo-political zones of Nigeria,” https://www.sciencedirect.com/science/article/pii/S0960148115003377 Renewable Energy, vol. 83, pp. 435–446, Nov. 2015.
costly grid extension to rural areas in Nigeria
technology combination include wind, solar, diesel generator and battery
research simulation results focus on NPC, CoE and renewable fraction
at 2014 diesel price of $1.1 and $1.3/L, hybrid of PV/diesel/generator shows optimum result
uses assumed PV cost of 3000 and $3200 per kW and lifetime of 20 years, 90% derating factor and 20% ground reflection
uses initial cost of AC diesel generator (25 kW) of $11,324, and a replacement cost of $10,200 while O&M cost $0.500/hr was used. The operating lifetime of diesel generator taken as 15,000 h with load ratio of 30%
COE of $0.547/kWh at $1.1/L and $0.547/kWh at $1.3/L were obtained for PV/diesel/Battery hybrid system against $1.075/kWh for diesel only
Aliyu, A. S., Dada, J. O. and Adam, I. K. (2015) ‘Current status and future prospects of renewable energy in Nigeria’, Renewable and Sustainable Energy Reviews, 48, pp. 336–346. doi: 10.1016/j.rser.2015.03.098.https://www.sciencedirect.com/science/article/pii/S1364032115002580
Kilinc Ata, N. (2015) ‘The Impact of Government Policies in the Renewable Energy Investment: Developing a Conceptual Framework and Qualitative Analysis’, Global Advanced Research Journal of Management and Business Studies, Vol. 4(2), pp. 067–081.
RE investment decision making
policy making and RE investment link
factors affecting RE investment
investors' experience survey
Nigeria left out in the survey
Gan, L. K., Shek, J. K. H. and Mueller, M. A. (2015) ‘Hybrid wind–photovoltaic–diesel–battery system sizing tool development using empirical approach, life-cycle cost and performance analysis: A case study in Scotland’, Energy Conversion and Management, 106, pp. 479–494. doi: 10.1016/j.enconman.2015.09.029.
Adaramola, M. S. (2014) ‘Viability of grid-connected solar PV energy system in Jos, Nigeria’, International Journal of Electrical Power & Energy Systems, 61, pp. 64–69. doi: 10.1016/j.ijepes.2014.03.015. https://www.sciencedirect.com/science/article/pii/S0142061514001173
PV LCOE $0.103/kWh
grid connected, household consumers
assumed PV cost US$2322/kW, inverter US$432/kW
economic analysis: LCOE and NPC
sensitivity along PV prices
Ohunakin, O.S., Adaramola, M.S., Oyewola, O.M. and Fagbenle, R.O., 2014. Solar energy applications and development in Nigeria: drivers and barriers. Renewable and Sustainable Energy Reviews, 32, pp.294-301. https://www.sciencedirect.com/science/article/pii/S1364032114000240
solar potential
shortage along energy value chain
previous solar projects - rural
drivers of solar projects - reforms, carbon footprint, demand
barriers - insecurity, land use
solutions - mitigate investment risk, cost reduction, awareness etc.
M. S. Adaramola, S. S. Paul, and O. M. Oyewola, “Assessment of decentralized hybrid PV solar-diesel power system for applications in Northern part of Nigeria,” https://www.sciencedirect.com/science/article/pii/S0973082613001130 Energy for Sustainable Development, vol. 19, pp. 72–82, Apr. 2014.
Assumption used include diesel price $1.1/L (before or by 2011) and annual mean global solar irradiation of 6.00kWh/m2/day
3% interest rate was used
hybrid of solar, DG and battery was considered
the hybrid system proves to be most economically viable solution with LCOE range of 0.348-0.378 $/kWh, subject to prevailing interest rate *Cost DG only varies from $0.417 and $0.423 per kWh
It also considers sensitivity along interest rate and cost of PV ($2400 to $4800 per kW)
LCOE results were also compared with existing electricity tariff to check grid parity
research focused on residential and small commercial users of semi-urban and rural areas of Northern Nigeria
daily load data from a secondary source dated back before 2011 was used
PV panels (mono-crystalline) from Canadian Solar with cost of was used
cost of PV was taken as $3200/kW, initial installation cost of $40/kW, replacement cost of $3200/kW, yearly O&M of $10 were assumed
average derating factor of temperate region was taken to be 0.75
20% ground reflectance
Two DGs with assumed capital cost of $175.1/kW (100kW) and $193/kW (160kW) were taken and 10% installation cost
Battery assumption include "a Surrette 6CS25P model with a nominal capacity of 1156 ampere-hours (Ah), cell voltage of 6 V, lifetime throughput of 9645 kWh, efficiency of 80% and a minimum state of charge of 40% (Rolls Battery) was selected". Also capital cost of $1200 and maintenance cost of $10/year were assumed.
Shaaban, M. and Petinrin, J. O. (2014) ‘Renewable energy potentials in Nigeria: Meeting rural energy needs’, Renewable and Sustainable Energy Reviews, 29, pp. 72–84. doi: 10.1016/j.rser.2013.08.078.
renewable energy potential
government policy
decentralized renewable energy - investment improvement
Siddig, K., Aguiar, A., Grethe, H., Minor, P. and Walmsley, T., 2014. Impacts of removing fuel import subsidies in Nigeria on poverty. Energy Policy, 69, pp.165-178.
reviews nation's energy policy statement of vision 20:2020
multiple taxation and lack of economic incentives among barriers to RE development
proposes legal reform such as investment laws and land use acts in support of RE
Adaramola, M. S., Oyewola, O. M. and Paul, S. S. (2012) ‘Technical and Economic Assessment of Hybrid Energy Systems in South-West Nigeria’, Energy Exploration & Exploitation, 30(4), pp. 533–551. doi: 10.1260/0144-5987.30.4.533. https://journals.sagepub.com/doi/pdf/10.1260/0144-5987.30.4.533
Most suitable hybrid location
household consumers, load from survey of ten (10)
PV+Wind+battery best combination
PV capital cost $2000 per kW
diesel generator cost $400 per kW and replacement and operational and maintenance costs as $350 per kW and $0.150/hr respectively
diesel price of $1.0/litre
battery cost is taken as $1250, replacement cost as $1100 and O&M as $11/yr
economic assumptions: real interest rate 9.35%
sensitivity: wind and solar matrices, varying diesel price
Goldthau, A. (2012) ‘A Public Policy Perspective on Global Energy Security’, International Studies Perspectives, 13(1), pp. 65–84. doi: 10.1111/j.1528-3585.2011.00448.x.
energy security
oil price volatility
Onwe, O.J., 2012. Economic implications of petroleum policies in Nigeria: An overview. American International Journal of Contemporary Research, 2(5), pp.66-71.
Branker, K., Pathak, M. J. M. and Pearce, J. M. (2011) ‘A review of solar photovoltaic levelized cost of electricity’, Renewable and Sustainable Energy Reviews, 15(9), pp. 4470–4482. doi: 10.1016/j.rser.2011.07.104.
addressed some misconceptions in LCOE calculation for PV
economic barrier as primary impediment to RE technology adoption in the society
defines clearly the concept of grid parity
PV grid parity as a function of local electricity prices, PV system component cost and geographical attribute
wrong LCOE reporting, strong effects on decision and policy making processes
wide and holistic sensitivity analysis of critical variables for decision making
most cost of electricity from other power plants from conventional sources are over estimated due to volatility, administrative duties and or systems upgrade - making electricity cost fixed and higher than actual generation cost
LCOE generally exclude risk and financing methods
accuracy of assumptions in LCOE estimation very critical to energy technology accurate lifetime assessment
PV system over-sizing, inadequate input assumptions and high LCOE estimates
main assumptions: discount rate, average system price, system lifetime, degradation and financing method
keeping other costs constant results indicates direct proportionality between interest rate and LCOE (i.e. LCOE drops with I.R drop and vice versa)
keeping I.R and PV cost constant, LCOE changes along varying diesel prices and GHI.
At higher I.R. and same PV cost, LCOE also changes along varying diesel price and GHI. Lower interest rate proves better
Adaramola, M. S., Paul, S. S. and Oyedepo, S. O. (2011) ‘Assessment of electricity generation and energy cost of wind energy conversion systems in north-central Nigeria’, Energy Conversion and Management, 52(12), pp. 3363–3368. doi: 10.1016/j.enconman.2011.07.007. https://www.sciencedirect.com/science/article/pii/S0196890411001981
considers sensitivity along inflation rate with respect to energy cost and return on investment effects
sensitivity along O&M cost with respect to energy cost effects
Tuomi, K. (2011) ‘The Role of the Investment Climate and Tax Incentives in the Foreign Direct Investment Decision: Evidence from South Africa’, Journal of African Business, 12(1), pp. 133–147. doi: 10.1080/15228916.2011.555279.
reviews and analyses foreign direct investment decision
investment decision making factors
how Sub-Sahara Africa can leverage on the information from the analysis
Bhattacharya, H. (2011) Banking Strategy, Credit Appraisal, and Lending Decisions: A Risk–Return Framework. Oxford University Press.
Loan and risk
capital investment
Eberhard, A. R., Orvika Shkaratan, Maria Vennemo, Haakon (2011) Africa’s Power Infrastructure. The World Bank (Directions in Development - General). doi: 10.1596/978-0-8213-8455-8.
power sector and investment growth
revenue loss due to power inefficiencies
power trade
S. M. Shaahid and I. El-Amin, “Techno-economic evaluation of off-grid hybrid photovoltaic–diesel–battery power systems for rural electrification in Saudi Arabia—A way forward for sustainable development,” https://www.sciencedirect.com/science/article/pii/S1364032107001694 Renewable and Sustainable Energy Reviews, vol. 13, no. 3, pp. 625–633, Apr. 2009.
relationship between diesel consumption, carbon emission and PV penetration (graphical)
LCOE of $0.17/kWh at $0.1/L diesel price
27% initial penetration of PV
Capital cost 6900US$/kW, Life time of 25 years and O&M cost 0US$/year
S. M. Shaahid and M. A. Elhadidy, “Economic analysis of hybrid photovoltaic–diesel–battery power systems for residential loads in hot regions—A step to clean future,” Renewable and Sustainable Energy Reviews, vol. 12, no. 2, pp. 488–503, Feb. 2008.
LCOE of 0.179 $/kWh for hybrid of PV, diesel and battery at $0.1/L diesel price
examines the effect of PV/Battery penetration on resulting COE
scenarios consider effect of hybrid system without battery on fuel savings, emission reduction and COEs of different hybrid combinations
Felix B. Dayo (2008) ‘Clean Energy Investment in Nigeria The domestic context’, International Institute for Sustainable Development (IISD).
considers obstacle to investment on renewable energy in Nigeria
reviews incentives for clean energy in the country
policy recommendation
T. Lambert, P. Gilman, and P. Lilienthal, “Micropower System Modeling with Homer,” in Integration of Alternative Sources of Energy, John Wiley & Sons, Ltd, 2006, pp. 379–418.
overview of modelling in HOMER
sensitivity analysis
considerations for offgrid systems
Purohit, P. and Kandpal, T. C. (2005) ‘Solar photovoltaic water pumping in India: a financial evaluation’, International Journal of Ambient Energy, 26(3), pp. 135–146. doi: 10.1080/01430750.2005.9674983.
NPV and IRR estimated
diesel price volatility with respect to break-even prices of diesel and electricity evaluated
consider effects of financial incentives such as tax and loan
Oparaku, O. U. (2003) ‘Rural area power supply in Nigeria: A cost comparison of the photovoltaic, diesel/gasoline generator and grid utility options’, Renewable Energy, 28(13), pp. 2089–2098. doi: 10.1016/S0960-1481(03)00009-0. https://www.sciencedirect.com/science/article/pii/S0960148103000090
grid extension cost versus PV versus diesel generator and gasoline generator
sensitivity: LCC vs module cost; LCC vs fuel price and LCC vs grid extension
sensitivity: increasing PV module cost
results: PV cot cost effective
costs are obsolete and assumptions
Adeoti, O. et al. (2000) ‘Engineering design and economic evaluation of a family-sized biogas project in Nigeria’, Technovation, 20(2), pp. 103–108. doi: 10.1016/S0166-4972(99)00105-4.
NPV, IRR and payback analysis
energy and development
Kalu, T. C. U. (1999) ‘Capital budgeting under uncertainty: An extended goal programming approach’, International Journal of Production Economics, 58(3), pp. 235–251. doi: 10.1016/S0925-5273(98)00121-2. https://www.sciencedirect.com/science/article/pii/S0925527398001212
attempts to address uncertainty problem in capital budgeting
correct discount rate as a prerequisite to optimal allocation policy