The Nigerian Association of Energy Economics (NAEE) Saturday called on the Federal Government to heed the advice of the International Monetary Fund (IMF) to remove petrol subsidy.
The association’s president, Prof. Wumi Iledare, said that the benefits of the subsidy are more in favour of the elite, who pay less for their luxurious consumption, than the poor that it ought to favour.
According to him, Nigeria budgets more money for petrol subsidy than it earmarks for health, education, roads and other infrastructure.
He accepted that the removal of the petroleum support from government would only spark a revolution in the interim, after which there will be calm and a realization of the benefits of the removal.
He complained that: “You are losing capacity. You have been giving the elite the opportunity to drive their cars without paying for it.”
He spoke in Abuja during the press conference on the 12th NAEE/IAEE conference with the theme: Energy access and efficiency imperatives for sustainable development in emerging economies.
Iledare also admonish the government to stop benchmarking its annual budget with the price of oil, stressing that “when you put your budget on oil, the uncertainty becomes too much.”
Continuing, he said that “There is an urgent need for Nigeria to focus on balancing its budget not on the back of energy production and pricing but on expanding and diversifying its budget process from the interaction of oil and gas production and petroleum pricing, the latter being highly stochastic.
“There is no doubt that access to affordable energy is vital for human survival and economic development of the human race.”
Instead of hinging the budget on the oil, he urged the government to base it on taxation, which is a global legitimate means of revenue generation.
He said that it was impossible for government to realize zero gas flare in the country next year.
According to him, the infrastructure for attaining the phase out of gas flare in 2020 are not in place and cannot be in place overnight.
He said the government was “kidding, where is the money ?”
Projecting solution to the nation’s energy challenges, Iledare said it would “begin with a coherent energy policy that is forceful, flexible and effective.”
The don noted that “Pragmatism begins from properly defining the underlying principles governing policy formulation. An energy policy that is based on woolly thinking and regional sentiments will not meet the targets emboldened in SDG 7 goals by 2030 in Nigeria. It is not about just power to light your homes and cool your environment but have to power the economy.”
On the focus of the conference, he said that The 2019 NAEE conference theme is in alignment with “Sustainable Development Goal 7 (SDG 7), set to “ensure access to affordable, reliable, sustainable and modern energy for all” (United Nations, 2018).
According to him, the third of three targets of SDG 7 is to double the global rate of energy efficiency improvement by 2030.”
Energy, he said, is a vital factor of production in any economy and an affordable access to sustainable energy is one of the key drivers of a global economic system that is sustainable.
The don noted that energy efficiency and access are imperative to mitigate climate change, improve energy and grow economies while delivering environmental and social benefits.
Efficiency and access, he said, are also relevant in achieving the sustainable development goals to meet energy needs, from the perspective of affordability, reliability and sustainability.