Energy has been essential in human development and economic growth, especially in its electricity form. As such, providing sufficient and affordable energy is required to increase human welfare and living standards. Energy is an essential factor in economic development since energy is used as a vital input in most production processes. Energy consumption increases in parallel with economic growth and development. In this vein, energy demand should be met sufficiently and economically. However, the energy consumed has a price, and the end user must pay for it.
The price of energy or electricity as it is mostly used can vary widely by country or by locality within a country. Electricity prices depend on many factors, such as the price of power generation, government taxes or subsidies, carbon emission taxes, local weather patterns, foreign exchange rates, transmission and distribution infrastructure, and multi-tiered industry regulation. The pricing or tariffs can also differ depending on the customer base, typically by residential, commercial, and industrial connections. In the last three years, there has been a progressive hike in electricity tariffs by the service providers across the customer base in Nigeria, which has raised lots of concerns from the customers as a significant portion of their income is allocated to servicing their energy needs. With the constant need for energy to keep up with household and commercial activities whilst managing its usage arises the need for energy efficiency.
Energy efficiency is using less energy to perform the same task or produce the same result. Energy-efficient homes and buildings use less energy to heat, cool, and run appliances and electronics, and energy-efficient manufacturing facilities use less energy to produce goods.
Energy efficiency is one of the easiest and most cost-effective ways to combat climate change, reduce consumer energy costs, and improve businesses’ competitiveness in Nigeria. Energy efficiency is also vital in achieving carbon dioxide net-zero emissions through decarbonisation. To achieve system-wide energy efficiency, we must make optimal choices regarding fuels, technology, the scale of operations, the pricing of energy resources, and the design of habitations, buildings and transportation systems.
Energy Efficiency Benefits
There are several benefits energy efficiency, or optimisation, offers to energy users, which could lead to positive externalities ranging from saving money, increasing the resilience and reliability of the electric grid, and providing environmental, community, and health benefits. Some of the specific benefits energy efficiency offers to Nigerians include:
- Cost Savings
Utility residential electricity rates (electricity tariff) fluctuate seasonally and annually but have risen steadily in the last five years. This trend will likely continue with the quest for the electricity regulator (NERC) and service providers (DisCos) to achieve the right pricing for electricity consumption. Conducting energy efficiency improvements on your home helps insulate customers from the financial impact of unpredictable sharp energy price increases that could happen in the future. Some energy efficiency improvements include using energy-efficient lightings such as LED lighting and adopting simple energy conservation behaviours or small energy-efficient purchases. Programmable thermostats, and advanced power strips, can decrease your energy expenses with almost no effort on your part. Energy-efficient buildings cost less to heat, cool, and operate, while industry and manufacturing plants can make products at lower costs.
- Environmental Benefits
These are some of the positive externalities of the efficient use of energy. Reducing energy use is essential in the fight against climate change because traditional power plants burn fossil fuels that release greenhouse gases and contribute to air pollution. In the bid to align with Nigeria’s ambitious net-zero target by 2060, the wide adoption of energy-efficient practices and solutions will help achieve this goal while ensuring environmental and social benefits to the country at large. Energy-efficient homes and buildings are better equipped to switch to renewable energy solutions, which do not produce harmful ecological emissions.
- Resilience and Reliability of Grid
Energy-efficiency improvements reduce the amount of electricity on the grid at one time, known as load, minimising congestion and stress on the Nigerian electric grid. Less load prevents power disruptions and long-duration of power outages or blackouts.
- Health Benefits
By reducing fossil fuels through the adoption of more energy-efficient technologies (such as renewable energy technologies), cleaner air, water, and land are produced, all of which have a direct impact on human health, especially among marginalised communities like IDP camps and those whose conditions are exacerbated by pollution.