JUST IN: Nigeria’s Push to End Solar Panel Imports Sparks Debate After N200 Billion Expenditure

The Nigerian Federal Government has reaffirmed its commitment to halting the importation of photovoltaic solar panels, a move that has already cost the nation N200 billion, according to the Rural Electrification Agency (REA).

This decision, rooted in the goal of fostering local manufacturing, has ignited widespread discussion, as highlighted in a recent post by Shegze on X.

The policy is part of a broader strategy aligned with Presidential Executive Order No. 5, which emphasizes the promotion of local content in science, technology, and engineering sectors.

However, while the intention to bolster domestic production is clear, the approach has raised concerns about its potential impact on Nigeria's renewable energy sector, particularly for solar financing startups and overall energy access.

The government's decision to curb solar panel imports stems from a desire to reduce dependency on foreign goods and accelerate the country’s transition to clean energy.

This initiative is not new—it draws from Executive Order No. 5, signed into law in 2018 by President Muhammadu Buhari, which aimed to prioritize indigenous expertise and resources in public procurement.

By encouraging local manufacturing, the government hopes to create jobs, stimulate economic growth, and build a self-sustaining renewable energy ecosystem.

The REA's report of N200 billion spent on imported solar panels underscores the financial burden of this dependency, making a compelling case for domestic production as a long-term solution.

However, the policy has not been without controversy. Industry experts and stakeholders, including the Centre for the Promotion of Private Enterprise (CPPE), have voiced concerns about the readiness of Nigeria’s infrastructure to support such a drastic shift.

While the idea of local production is promising, the country currently lacks the robust manufacturing capacity needed to meet demand.

For instance, although a photovoltaic panel assembly plant has been established in Lagos by Auxano Solar, with a capacity of 100 MW, this is still a nascent step.

Nigeria’s grid-connected solar capacity stood at just 37 MW by the end of 2022, according to the International Renewable Energy Agency (IRENA), highlighting the gap between ambition and reality.

Without a phased approach—such as incentives for technology transfer, quality assurance mechanisms, and investment in local infrastructure—the sudden ban on imports could disrupt the renewable energy market.

Solar financing startups, which have gained momentum in recent years by securing significant investments to drive renewable energy adoption, are particularly vulnerable.

These companies rely on imported panels to provide affordable solar solutions to households and businesses, especially in a country where unreliable electricity supply is a persistent challenge.

A premature import ban could increase costs, deter investors, and slow down the growth of the renewable energy sector, potentially leaving many Nigerians without viable alternatives to the national grid.

The CPPE has suggested measures like zero import duties on renewable energy equipment, tax holidays for solar companies, and a more gradual transition to local production to mitigate these risks.

Public sentiment, as reflected in the X thread, mirrors these concerns.

Many Nigerians are frustrated, arguing that the government has failed to provide consistent electricity—often less than six hours daily—prompting citizens to turn to solar solutions.

Commenters like ThatOjoBoy and Kpanti_mama01 expressed outrage, accusing the government of obstructing the common man’s access to reliable energy. Others, such as Grind & Charts, emphasized the need for actionable plans to support local production rather than mere policy statements.

As Nigeria aims to meet 60% of its energy demand with clean energy by 2050, striking a balance between fostering local industry and ensuring energy access will be critical to the success of this initiative.