An evaluation of government subsidies’ role in promoting renewable energy adoption in Nigeria: A case study of the Ministry of Power (2000–2020).
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Background of the study
Government subsidies are a key policy tool used to promote the adoption of renewable energy by reducing financial barriers and incentivizing investment in green technologies. In Nigeria, the Ministry of Power has implemented various subsidy schemes between 2000 and 2020 to encourage renewable energy projects, particularly in solar and wind power. These initiatives aim to reduce the cost of renewable energy installations, stimulate private sector investment, and increase energy access in underserved areas (Oluwaseun, 2023). Empirical evidence indicates that subsidies can accelerate technology adoption and contribute to environmental sustainability by reducing carbon emissions and enhancing energy security (Ibrahim, 2023). However, challenges such as inefficient fund allocation, corruption, and policy discontinuities have sometimes limited the impact of these subsidies (Chinwe, 2024). This study critically evaluates the role of government subsidies in promoting renewable energy adoption in Nigeria by examining policy effectiveness, subsidy design, and implementation outcomes.
Statement of the problem
Despite the provision of subsidies by the Ministry of Power, renewable energy adoption in Nigeria remains below expectations due to challenges such as inefficient fund management, policy discontinuities, and corruption (Ibrahim, 2023; Chinwe, 2024). These issues reduce the effectiveness of subsidies and hinder the transition to a sustainable energy future. The study aims to identify key obstacles in subsidy implementation and propose measures to enhance the impact of government support on renewable energy adoption.
Objectives of the study:
- To evaluate the impact of government subsidies on renewable energy adoption.
- To identify challenges in subsidy implementation.
- To recommend strategies for improving subsidy effectiveness.
Research questions:
- How do government subsidies affect renewable energy adoption?
- What challenges limit the effectiveness of these subsidies?
- What policy measures can improve subsidy outcomes?
Research Hypotheses:
- Government subsidies positively influence renewable energy adoption.
- Inefficient fund management diminishes subsidy impact.
- Policy reforms can enhance renewable energy uptake.
Significance of the study
This study is significant as it evaluates the role of government subsidies in promoting renewable energy adoption in Nigeria. The findings will assist the Ministry of Power in refining subsidy schemes to achieve greater environmental sustainability and energy security, thereby contributing to the nation’s transition toward a renewable energy future (Ibrahim, 2025).
Scope and limitations of the study:
This study is limited to assessing the impact of government subsidies on renewable energy adoption in Nigeria, focusing on the Ministry of Power’s initiatives.
Definitions of terms:
- Government Subsidies: Financial support provided by the government to lower the cost of goods or services.
- Renewable Energy Adoption: The uptake of energy generated from renewable sources.
- Ministry of Power: The government agency responsible for energy policy and development.
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