The Centre for the Promotion of Private Enterprise (CPPE) has cautioned the federal government against its proposed ban on the importation of solar panels, warning that such a policy could exacerbate Nigeria’s energy crisis and deter investment in renewable energy solutions.
The warning follows a statement by the Minister of Science and Technology, Mr. Uche Nnaji, who suggested that restricting solar panel imports would boost local production.
However, CPPE argues that Nigeria’s domestic production capacity is currently inadequate to meet demand and that an outright ban would be counterproductive.
Nigeria ranks among the countries with the poorest energy access, with a per capita electricity consumption of approximately 160 kWh, far below the sub-Saharan average of 350 kWh.
The CPPE stressed that solar energy adoption has been a key strategy to bridge this gap, and a ban would disrupt the momentum gained in recent years, particularly among households, small businesses, and rural communities.
“The adoption of solar energy solutions has gained remarkable traction, especially in light of soaring energy costs. A ban would significantly increase the cost of solar solutions, making them unaffordable for the average Nigerian,” CPPE stated.
Beyond the energy crisis, CPPE highlighted the economic consequences of the proposed ban, emphasising that such a move would undermine investor confidence and create policy uncertainty.
The business community, multilateral organisations, and renewable energy investors have already expressed concerns over the policy, which CPPE warns could slow down much-needed investments in the sector.
Furthermore, CPPE noted that a major trade policy decision like this should not fall under the purview of the Ministry of Science and Technology but rather the Coordinating Minister of the Economy, in collaboration with the Ministers of Industry, Trade, and Investment, as well as National Planning and Budget.
The organisation called for extensive stakeholder consultations before implementing any policy changes of this magnitude.
While CPPE acknowledged the government’s vision for local solar panel production, it urged a gradual and well-planned transition instead of an abrupt import ban.
It is recommended that the government provide incentives such as tax breaks, tariff concessions on intermediate goods, and long-term low-interest financing to encourage local manufacturing.
Additionally, CPPE advised reducing import duties on critical solar components, including batteries, inverters, and wind turbines, to five per cent to enhance energy access, security, and economic productivity.
The group also called for subsidies and investment incentives similar to those in other countries to support the growth of Nigeria’s renewable energy sector.
CPPE further clarified that Executive Order 5, which the Minister referenced, pertains to procurement policies favouring local providers in government contracts and does not equate to a trade policy restricting imports.
The organisation urged the government to provide immediate clarification on its stance to prevent further uncertainty and potential disruptions in the renewable energy market.
“Nigeria is not ready for a ban on solar panel imports, given the country’s acute energy deficit and the glaring limitations in local production capacity,” CPPE concluded.
