New industrial policy backs renewable energy, state power autonomy to spur industrial growth

Unveiled recently in Abuja by the Federal Ministry of Industry, Trade and Investment, the policy document outlines a comprehensive framework aimed at moving the country from policy to productivity by addressing structural bottlenecks that have constrained industrial growth for decades, top among them unreliable electricity supply.The policy comes at a time when Nigeria’s manufacturing sector remains under significant strain, weighed down by unreliable electricity supply, elevated production costs, limited access to finance, persistent infrastructure gaps, and a heavy dependence on imported goods.The policy aligns closely with the provisions of the Electricity Act 2023, which empowers state governments and private investors to generate, transmit and distribute electricity within their jurisdictions.By decentralising the power sector, the Federal Government aims to unlock subnational energy markets, attract investment into captive and embedded generation, and reduce overreliance on the national grid.

A central pillar of the policy is the promotion of renewable energy as a sustainable alternative for industrial clusters. Government plans include incentivising local production of renewable energy hardware such as solar panels, scaling up hybrid and solar PV systems within industrial estates, and supporting independent power projects (IPPs) tailored to manufacturing hubs.

The policy sets a target for at least 25 per cent of Nigeria’s energy mix to come from renewable sources by 2030. It also proposes lease-to-own models and long-term power purchase agreements to allow industries to install renewable systems with minimal upfront costs.