Improvement of Industrial Energy Efficiency in Nigeria

1. Improvement of Industrial Energy Efficiency in Nigeria Presented by UNIDO

2. Background • Population, growth rate and energy consumption nexus • Fast growing sectors (industry, transport, construction, etc) are major energy consumers • Power generation in Nigeria is inadequate and unstable • Hence, diesel and petrol generators serve as a primary or back-up source of electricity • Implication: noise, pollution and high cost • Despite the above, considerable potential for energy savings exist in the Nigerian industrial sector

3. Background (cont’d) • In view of the above challenges, the FGN has launched a number initiatives and projects to promote EE and RE: • the UNDP on energy efficiency in residential and public sectors • the World Bank on urban transport • UNIDO on renewable energy

4. Project objective To promote increased energy efficiency in the industrial sector of Nigeria through implementation of energy management systems and energy system optimization

5. Project outcomes • Improved policy and regulatory frameworks, incentive schemes and support programmes, energy data collection and management facilitate sustained energy efficiency improvement in industry • Strengthened or built capacity of institutions, industries, consultants and equipment suppliers on energy management systems, energy system optimization, and EE project financing assist industries in the implementation of EE improvement • Demonstrated projects on energy management system, and energy system optimization in selected plants and sub-sectors; and prepared case studies with proven energy saving, management improvements, economic gains and GHG emissions reduction leverage the interest and support for investment in IEE projects • Adequate monitoring and evaluation facilitate smooth and successful project implementation

6. Project component • Improvement of policy and regulatory frameworks, incentive schemes, and support programmes Key outputs • Industrial energy usage mapping for determining the focus of other subsequent interventions. • Development of an EE strategy based on experience and lessons learned from other countries. • Incentive schemes and support programmes developed and capacity strengthened to monitor their implementation. • Energy consumption data by large and medium industry establishments collected and managed. • Institutional capacity of related government institutions strengthened, including monitoring and evaluation

7. Project component (cont’d) 2. Capacity building on EnMS and energy system optimizations Key Outputs: • 300 business owners and factory top managers provided with introductory and awareness training on EnMS, 100 plant engineers and consultants receive EnMS user-training, and at least 50 experts trained on EnMS. • User and expert training on energy system optimizations conducted • Training on EE project financing provided to industry and financial institutions, and • Capacity of relevant national standards agencies/departments/institutions strengthened for ISO 50001 promotion, certification and accreditation, for example, the training of Lead Auditors

8. Project component (cont’d) 3. Demonstrations and up-scaling Key Outputs: • Energy management systems implemented in at least 100 industrial establishments, 20 case studies prepared; • At least 20 optimization projects implementing energy systems: pump, compressed air, fan, and steam case studies prepared and; • Intensive awareness and advocacy programmes designed and implemented

9. Project component (cont’d) 4. Monitoring and Evaluation Key Outputs: • Regular monitoring exercises conducted, various project progress reports prepared; monthly, semi-annually, annually. • Mid-term and final project evaluation conducted and report prepared

10. Justification for the project • In line with national priorities • Deals with a niche area • Minister of Power requested UNIDO Director General to focus technical assistance to Nigeria on development of a project on IEE for industrial regions • Request from Energy Commission of Nigeria

11. Rationale for UNIDO to implement • Recognized by the GEF as having comparative advantage in IEE under the CC Focal Area • UNIDO is already implementing more than 20 projects on IEE under the GEF4 and GEF5 cycles – large scale projects (USD2-10 Million) • In 2010, UNIDO began implementing a large scale IEE project in South Africa, with a total budget of USD 10 million provided by the Government of South Africa, SECO and DFID • UNIDO has developed a comprehensive training programme and mobilized a large pool of highly qualified international trainers

12. Proposed project partners • Federal Ministry of Environment • Federal Ministry of Power • Energy Commission of Nigeria • Federal Ministry of Industry, Trade and Investment • Standards Organization of Nigeria • Bank of Industry • Development and commercial banks • Manufacturers Association of Nigeria