Precious Anga
Lagos — Nigeria will require about $410 billion in additional investment by 2060 to achieve its net-zero pathway, Vice President Kashim Shettima has said, as the Federal Government intensifies efforts to attract private capital into green infrastructure and the country’s energy transition.
Shettima made the disclosure at the second Decarbonising Infrastructure in Nigeria, DIN, Summit in Abuja, where government officials, investors, development finance institutions, climate experts and members of the diplomatic corps examined ways to close the financing gap facing Nigeria’s green transition.
Represented by his Deputy Chief of Staff, Senator Ibrahim Hadejia, the Vice President said the scale of investment required should not be viewed only as a financing challenge but also as a major opportunity for investors.
“Our Energy Transition Plan estimates that Nigeria will require about $410 billion in additional investment above business-as-usual through 2060 to achieve its net-zero pathway.
“That is a significant financing requirement. But it also tells us something else: there is a very large investment opportunity ahead of us,” he said.
Shettima said government would remain an important player in financing the transition but could not provide all the capital required to meet Nigeria’s long-term energy and infrastructure objectives.
“We need the private sector. We need development finance institutions. We need domestic financial institutions and institutional investors. And, perhaps most importantly, we need projects that are properly prepared and capable of attracting that capital,” he said.
The summit, organised by the Office of the Vice President with support from the National Council on Climate Change and the United Nations Industrial Development Organisation, UNIDO, was themed: “De-risking Green Infrastructure Investment in Nigeria: Enabling Policy, Project Readiness and Risk-Sharing Solutions.”
Shettima said the central challenge was no longer simply the availability of policies, ideas or climate ambitions, but the ability to turn them into projects that investors could assess, finance and implement.
He said investors would need clarity on the policy environment, credible revenue models, adequate technical preparation and proper allocation of risks before committing long-term capital.
“These are practical questions. And I believe that is where DIN Summit 2.0 can make a useful contribution,” he said.
The Vice President acknowledged the policy, financial, technical and institutional challenges facing green infrastructure investment in Nigeria, but said stronger collaboration among stakeholders could help address them.
He added that Nigeria’s NDC 3.0 recognised the need to develop a stronger pipeline of projects with viable financing propositions, increase private-sector participation and improve access to climate finance.
The financing challenge was further highlighted by the UNIDO Sub-Regional Representative in Nigeria and ECOWAS, Ambassador Philbert Abaka Johnson, who said Nigeria’s physical infrastructure investment needs were estimated at approximately $3 trillion by 2050.
Johnson said tracked climate finance flows into Nigeria averaged only $2.5 billion annually in 2021 and 2022, against estimated annual requirements of $29.7 billion, leaving an estimated financing gap of about $27.2 billion each year.
He identified policy and regulatory uncertainty, fragmented approval processes, unclear institutional mandates and undefined revenue or offtake arrangements among the factors preventing otherwise credible projects from attracting financing.
“These projects sit at very different stages of maturity, from concepts which require feasibility work to projects ready to seek finance,” Johnson said.
He said stakeholders needed to address these constraints sequentially and ensure projects were developed to a stage where investors could properly assess their risks and financing prospects.
UNIDO said it would deploy its Computer Model for Feasibility Analysis and Reporting, COMFAR, software and Digital Investment Promotion Platform to support project development. The organisation said the tools are already used by more than 11,000 practitioners across 160 countries.
Johnson also called for the operationalisation of the Climate Change Act and protection of power purchase agreements as part of efforts to unlock carbon finance in Nigeria and across Africa.
The Presidency also highlighted the African Development Bank’s Alliance for Green Infrastructure in Africa, which is seeking to mobilise $500 million in early-stage blended finance to develop a pipeline capable of attracting substantially larger investments.
Personal Assistant to the President on Subnational Infrastructure, Musaddiq Adamu, said the DIN initiative was designed to answer a practical question: how to move green infrastructure projects from ideas to investment.
He cited the electrification of port operations as an example of the potential impact of investor engagement, saying discussions following an earlier DIN Summit presentation by APM Terminals contributed to a $60 million agreement with the Nigerian Ports Authority to advance port electrification, with Onne Port positioned to become Nigeria’s first green port.
“For me, that is an important lesson. The objective is not simply to have a good conversation. The goal is to create real investment opportunity,” Adamu said.
Director-General of the National Council on Climate Change, Dr Omotenioye Majekodunmi, said green infrastructure had the capacity to create more than 300,000 jobs.
Participants also called for standardised public-private partnership agreement templates and dedicated early-stage project development funding to build a pipeline of bankable projects in areas including mini-grids, clean transportation and green buildings.
They stressed the importance of greater certainty around power purchase agreements, revenue structures, regulatory processes and contractual obligations as Nigeria seeks to mobilise long-term private capital for its green infrastructure and energy transition.
The summit ultimately placed project readiness, policy certainty and risk-sharing at the centre of efforts to attract the additional investment Nigeria requires to pursue its net-zero pathway by 2060.
