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ENERGY POVERTY IN NIGERIA: A CRITICAL ASSESSMENT

ENERGY POVERTY IN NIGERIA: A CRITICAL ASSESSMENT. Obafemi, Frances NGOZI and Ifere , Eugene Okoi Department of Economics University of Calabar - Nigeria A paper presented on the 6 th annual iaee/ naee international conference, 22-23 APRIL, 2013, Lagos, NIGERIA.

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ENERGY POVERTY IN NIGERIA: A CRITICAL ASSESSMENT

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  1. ENERGY POVERTY IN NIGERIA: A CRITICAL ASSESSMENT Obafemi, Frances NGOZIand Ifere, Eugene OkoiDepartment of Economics University of Calabar - NigeriaA paper presented on the 6th annual iaee/naee international conference, 22-23 APRIL, 2013, Lagos, NIGERIA

  2. Nigeria!.. Wallowing in Energy Poverty ? Poverty/Economic Uncertainty Economic Woes!! Despite abundant energy sources? Results from Energy Poverty Income Inequality Government Actions Inflation Business as Usual

  3. 1 Energy Resources in Nigeria 2 Energy Poverty 3 4 Result Interpretation 5 Conclusion & Recommendations 6 Presentation outline The trend Method. 3

  4. Energy Resources in Nigeria Despite abundant energy sources in Nigeria, Nigeria is worst hit in terms of fuel poverty, incessant energy price hike and energy insecurity. ..major strategic challenges that militate against its efficiency... disruptions to its supply environmental damage during production and usage persistent energy poverty

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  6. Energy (Fuel) Poverty • Energy (Fuel) poverty has been a persistent problem for almost every Nigerian with no end to high energy prices in sight. • A household is said to be in energy poverty if it needs to spend more than 10% of its income on fuel to maintain a satisfactory heating regimes. • Higher fuel prices have led to the doubling of fuel poverty in Nigeria. • Fuel poverty is largely down to three factors- income, energy prices and energy efficiency (www.parliament.uk, 2011).

  7. many reasons for increases in prices and fuel poverty encourages the ruling cabals to import fuel into the country in order to make profits.

  8. cost of energy blamed for … • the collapse of textiles • auto manufacturing industries in Nigeria • (Shaad and Wilson, 2009). • Energy prices have been proportionately higher for industries and have direct impact on costs and competitiveness, especially for transport companies and energy intensive industries (www.parliement .uk, 2011). • The tariff by communication companies, cost of transportation, Electricity to light up buildings and almost the cost of all economic activities have gone very high due to direct or indirect impact of cost of fuels to power economic activities.

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  10. Except for a coordinated, coherent and comprehensive fuel and energy policy 11 11

  11. Methodology. • Study based on 300 respondents from the different income strata within selected six local government Areas in the Three Senatorial districts of Cross Rivers State. • Initially Four hundred and Fifty copies of the questionnaire were sent out: one hundred and fifty copies (50 each) were administered on Senior Staff from the rank of Professors, to attendants in the three Tertiary institutions in each senatorial district of the state (University of Calabar, School of Nursing Itigidi and CRUTECH Ogoja Campus). • Three hundred copies of the questionnaire were administered randomly on various respondents . • Of the one fifty copies mailed out to the Staff of the tertiary institutions one hundred and twenty- five were properly completed and returned • while a total of One hundred and Seventy-five copies were duly completed and retrieved from the other respondents. The study was eventually based on three hundred respondents, (Study Sample size).

  12. Study designed to solicit responses in the following areas. • …Causes (or reasons) for fuel poverty. • … Identification of the problems (or Impact) of fuel poverty on the citizens; • … The various ways through which fuel poverty is perpetrated; • … Evaluation of the possible consequences of fuel poverty on the citizenry and economy in general.

  13. Result Interpretation: Monthly fuel Expenditure by households

  14. Result Interpretation: comfort ability and acceptance of energy poverty

  15. Result Interpretation: causes of energy poverty in Nigeria

  16. Result Interpretation: economic and social Consequences of high energy cost on Nigerians

  17. CONCLUSION • The aim of this study was to consider an apt remediation for this state of affairs (High Energy Poverty ), using Cross River State of Nigeria, as an example. • This situation is causing untold widespread poverty among the teeming population, for decade’s hence causing economic bleakness. This is because energy is a key to economic development and political stability. • From all indications it is now clear that the only cushion to reduce energy bills and fuel poverty to a tolerable level is a policy towards energy efficiency which entails reaching an informed judgment on the pricing of fuel in Nigeria to avoid the untold fuel poverty that has been lingering on for decades Wednesday, September 17, 2014

  18. Recommendations • For Nigeria Governments to solve the teething problem of energy poverty ,it would be appropriate to take a look at the factors responsible for the incidence of energy poverty. • All refineries must be put on stream by proper overhaul to maximize local refining capacity utilization. • transparent and comparable information on energy use and prices . • Improve oil and gas development and production efficiency • Improve distribution network by setting tank farms in all the geopolitical zones to ease free flow and supply of products to control scarcity. • Using railways as an alternative means of transporting petroleum products • Adopting a physical policy of direct involvement in distribution by NNPC to check the excesses of independent tanker drivers.

  19. Stop importation of fuel of any sort • Increase storage region in times of unforeseen circumstances. • Government should construct new transmission lines to improve power supply. • Fast tracking and passage of the Petroleum industry Bill (PIB) to reform the entire energy sector. This Bill would bring in three measures: an energy efficiency programme to bring existing homes up to current energy efficiency levels; social tariffs to limit vulnerable households' exposure to high energy bills; and reinforcement of the legal duty on the Government to act to end fuel poverty. • Alternative energy sources such as solar energy, biomass and wind energy should be annexed to provide the necessary power generation levels.

  20. Thank you! 22

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