On March 6, 2019, the World Bank announced a new program to help developing nations especially those with populations living without access to reliable electricity to fast-track the process of adopting offshore wind energy. This is a program Nigeria can invest in to boost her energy supply potentials. However, with existing technology, there is no way to construct offshore wind farms without the offshore oil platform. It is not just only a cheaper way to get wind power and let wind developers place their turbines further out to sea according to SeaEnergy Renewables. It is also an opportunity for oil companies to diversify their revenue by selling excess generated energy to the grid.
Specifically, wind energy is captured offshore via the use of turbines. The building of wind farms offshore has increased due to wind conditions being stronger and more stable at sea, larger units being more easily transported and deployed, less visual disturbance and potential conflicts of interests being minimized. Offshore wind is also the answer to zero-carbon renewable energy goals. This technology has grown nearly five-fold since 2011 with 23GW installed at the end of 2018. Offshore wind now represents about $26 billion in annual investments in clean energy, and this proportion is set to increase dramatically, with about $500 billion expected to be invested in offshore wind projects by 2030. Thus, the Offshore wind market could grow to be worth about $225 billion annually by 2025, bigger than the current offshore oil and gas market, based on a development cost of $3 million per gigawatt, with a global generating capacity of 70 GW.
A wake-up call for Nigeria’s dwindling energy market
The global oil crisis experienced by the world presently is a wake-up call for policymakers in Nigeria to rethink strategies of diversifying the economy to other sectors such as agriculture and manufacturing. However, no long term policy or strategy can ride on the unreliable nature of power in Nigeria.
Despite being the largest economy in sub-Saharan Africa, the limitations in the Nigerian power sector constrain growth. Inadequacies characterize the system at all levels (generation, transmission, and distribution) leaving a huge deficit of energy demand. Presently, the installed capacity of the generation plant is 12,522MW. 69 percent of this is not generated due to the non-operational capacity of the systems. This implies that the existing system can only generate about 4,000MW on average, which is insufficient. Not also forgetting that 7.4% of the generated capacity is lost during transmission.
In the Nigeria Power Baseline Report 2015, Nigeria’s per capita power consumption was ranked as one of the lowest in Africa and globally with a rate of 151kwh. This keeps the number of households without access to electricity to about twenty million households and for those with access, the supply is grossly epileptic.
These statistics are too poor to initiate an industrialization process that would place Nigeria amongst the top twenty economies in the world as envisioned by the vision 20-2020 goals. That means, with the nature of infrastructure currently on the ground and the rate of investment into the electricity sector of Nigeria, Nigeria might still not be able to achieve the vision 20-2020 goals even if it is extended to vision 20-2040.
These goals can only be possible if the government diversifies the energy sources in domestic, commercial, and industrial sectors and adopts new available technologies such as renewable energies to reduce energy wastages and to save cost. Various world powers and even developing countries are currently looking at offshore wind as a means of generating energy for oil and gas production, on the grid and off-grid.
Prospects of Offshore Wind in Nigeria
In recent years, offshore has shown potentials beyond being a platform for oil and gas exploration to being a platform for electricity generation. Across crude oil fields, the offshore platforms contribute a good number of quantities of oil barrels produced per day. Oil production from Nigeria’s offshore province is currently 850,000 barrels per day, representing 40.47% of the total production of 2.1 million barrels per day. It is further projected that two-thirds of the nation’s production will stem from deep-water deposits by 2022 which will boost West African’s country’s oil output by about 10 percent. Oil exploration offshore has helped to minimize risks from sabotage, kidnapping and crude oil theft obtainable in the Niger Delta region. Only between 2018-2020, Nigeria lost 54373.22 barrels of oil worth $2718661 in 989 oil sabotage and theft incidence.
Despite the abundant untapped opportunities in Nigeria’s offshore oil field, it has generated revenue exceeding $180billion. With no big developments lined up on land, the share of output stemming from offshore is only going to rise but it will take time.
Thus, continuous exploitation of the potentials of offshore oil platforms requires efficient and independent electrical systems for generating energy. However, most existing offshore platforms functioning with independent electrical energy generating systems like the gas turbines, operate under 30% efficiency ranges, when the normal efficiency should be about 55% considering a combined cycle gas power plant.
Production and other support activities requiring electrical power up to 100MW make the operation of offshore oil platforms with gas turbines expensive. Furthermore, offshore platforms that make use of gas turbines as independent electrical systems for generating energy increase the air pollution of the offshore environment. As such, access to a clean and affordable power supply is crucial to fostering social and economic development and to achieve sustainable development goals.
The development and fruitful investment in the offshore oil and gas sector in Nigeria could also be replicated to take care of the epileptic power supply system in Nigeria. Offshore areas from Lagos through Ondo, Delta, Rivers, Bayelsa to the Akwa Ibom States were reported to have potentialities for harvesting strong wind energy throughout the year.
Currently, offshore wind farms are located in shallow waters (up to 60 meters deep) and away from the coast, marine traffic routes, strategic naval installations, and spaces of ecological interest. As such, the operation of Total SA’s $4 billion Egina floating productions, storage, and offloading vessel further offshore, in deeper waters, is a good sign of confidence in the possibility of exploring offshore renewable energy. With no big developments lined up on land for oil exploration and electricity generation, the share of output stemming from offshore oil exploration and electricity generation is only going to rise although it will take time.
Although it has taken over 15 years for Egina to start production since it was discovered the past 15 years, since around the time that Egina was discovered, a projection of 200,000 barrels a day and about 10% boost in West African country’s oil output is worth the wait. Similarly, although an investment in offshore wind energy may not yield immediate result, its effect in years to come will be one that will propel industrialization and an increase in the supply of electricity in Nigeria.
The Federal Government needs to take a cue from the success story of offshore oil and gas exploration to develop a robust policy framework of legal and regulatory mechanisms that would encourage the development of offshore wind energy to diversify energy generation options, attract foreign and indigenous investors and also set standards for offshore wind energy. This will help to relieve the burden on hydro and thermal electricity generation plants while creating a scheme that will restructure the power generation sector and provide clean and affordable energy to citizens.