SEforALL Terms of Reference Nigeria NDC/ETP Alignment (through evaluating aligned alternatives to Oil revenue)

Procurement
Closing date
03 Feb 2023
Location
Remote
Duration of assignment
13 February 2023 to 31 August 2023

Background and Context 

Sustainable Energy for All (SEforALL) is an international organisation working with leaders in government, the private sector and civil society to drive further, faster action toward achievement of Sustainable Development Goal 7 (SDG7), which calls for universal access to sustainable energy by 2030, and the Paris Agreement, which calls for reducing greenhouse gas emissions to limit climate warming to well below 2° Celsius.     

Achieving these goals will require a radical rethink of the way we produce, distribute, and consume energy. SEforALL is at the heart of this foundational shift to ensure no one is left behind. Drawing on data and evidence, we identify a critical path to success in achieving SDG7.     

Former UN Secretary-General Ban Ki-moon launched the Sustainable Energy for All initiative in 2011. Now an independent organization, we maintain close links with the UN, including through a relationship agreement, partnerships with UN agencies and with SEforALL's CEO acting as the UN Secretary-General's Special Representative for Sustainable Energy for All and Co-Chair of UN-Energy. These roles include advising the UN Secretary General and his staff on issues relating to sustainable energy and the implementation of SDG7 and supporting the coordination of sustainable energy issues in the United Nations system.     

The ambitions of SDG7 are extraordinary. Aiming to achieve them in the context of the Paris Agreement on climate change involves transformation at a scale never undertaken before. Swift action must be taken by leaders in governments, private sector companies, institutions, financiers, development banks, unions, communities, entrepreneurs and civil society. As we enter the final decade to achieve SDG7, SEforALL has strategically chosen to strengthen global agenda-setting while expanding its activities to an engagement model that prioritizes data-driven decision-making, partnerships with high-impact countries and implementation on the ground. The new SEforALL three-year business plan outlines work programmes that scope out our planned interventions and demonstrate to our funding partners the impact of their support. http://www.seforall.org/ 

   

Nigeria Energy Transition Plan  

Nigeria is a high-impact country for achieving SDG7 which calls for universal access to clean and affordable energy. Based on the latest data available, 92 million Nigerians lack access to electricity while 175 million lack access to clean cooking solutions.  At the same time, the reality and grave impacts of climate change are already manifest in the form of floods, pollution, erosion, desertification, and the associated socio-economic consequences. As a result, demanding and modelling bold action to address energy poverty and mitigate climate change is a priority for the nation.   

Consequently, SEforALL alongside the UK Energy Transition Council supported the Nigerian Government in designing an Energy Transition Plan (ETP) to tackle the dual crises of energy poverty and climate change and deliver SDG7 by 2030 and net-zero by 2060, while also providing energy for development, industrialization, and economic growth. The Nigerian ETP is the first of its kind in Africa and details pathways for significant low-carbon development of energy systems across 5 key sectors: Power, Cooking, Transport, Industry, and Oil and Gas. The plan also highlights the key role Natural Gas must play as a transition fuel on Nigeria’s path to net-zero.   

Since its unveiling, the ETP has been approved by the Federal Executive Council (FEC) and adopted as national policy. On the 24th of August 2022, a virtual global launch of the ETP took place with participation from key partners across the globe and an official website (www.energytransition.gov.ng) was published. An Energy Transition Implementation Working Group (ETWG) chaired by His Excellency Vice President Yemi Osinbajo (SAN) and comprising of several key ministers including the Ministers for Environment, Power, Finance, Works & Housing, Petroleum Resources, and Foreign Affairs has been established to drive the implementation of the plan. Sustainable Energy for All (SEforALL) and the Global Energy Alliance for People and Planet (GEAPP) support the working group through a dedicated secretariat, the Energy Transition Office (ETO).   

The Federal Government of Nigeria has undertaken these activities to indicate strong political and social will for the transition to net-zero, however, the question of the future of oil in the prominent oil-producing state persists. Nigeria’s federal and state governments are heavily dependent on oil revenues for the delivery of public goods, servicing of debt and bolstering of the national currency. Oil exports supply about 90 percent of the nation’s foreign exchange and over half of federal government revenues[1].  In 2021, petroleum exports made up more than 85 percent of the government’s total export revenues[2]. Relatedly, almost all of Nigeria’s states depend on oil revenues, channelled from the Federation Account and Allocation Committee (FAAC), for more than 50 per cent of their fiscal needs[3]. Yet, His Excellency President Muhammudu Buhari’s 2060 net-zero commitment at COP26 in Glasgow and the targets of the approved and adopted Energy Transition Plan imply that emissions, and by extension, production from the sector have to reduce dramatically.  

Beyond national targets, it is increasingly apparent that global momentum towards sustainability and away from fossil fuels is accelerating. McKinsey estimates that global oil demand could peak as soon as 2024 and global gas demand could peak around 2030 if leading countries achieve their net-zero commitments[4]. Similarly, the International Energy Agency (IEA) has highlighted that the global energy sector needs to achieve a significant reduction in the use of hydrocarbons by 2040—including the phasing out of all unabated coal and oil power plants—in order to reach net zero by 2050[5]. The top five export destinations for Nigeria’s petroleum products (India, Spain, Netherlands, United States and China) have committed to achieving carbon neutrality between 2050 and 2070[6]. This suggests rapidly shrinking global oil demand and reduced opportunity for Nigeria to continue generating significant revenue from oil production.  

As the Nigerian government intensifies efforts to deliver its ETP and align with other NDC and climate change strategies, it is important to devise strategies for the replacement of the huge shares of government revenue and foreign exchange earnings presently supplied by oil. 

 [1] https://www.premiumtimesng.com/news/more-news/522782-analysis-ending-nigerias-oil-dependency-and-preparing-for-a-future-without-oil.html

[2] https://www.mckinsey.com/industries/oil-and-gas/our-insights/the-future-of-african-oil-and-gas-positioning-for-the-energy-transition

[3] https://www.premiumtimesng.com/news/more-news/522782-analysis-ending-nigerias-oil-dependency-and-preparing-for-a-future-without-oil.html

[4] https://www.mckinsey.com/industries/oil-and-gas/our-insights/the-future-of-african-oil-and-gas-positioning-for-the-energy-transition

[5] Same as above

[6] https://www.premiumtimesng.com/news/more-news/522782-analysis-ending-nigerias-oil-dependency-and-preparing-for-a-future-without-oil.html

 

Objective   

The purpose of this consultancy is to outline alternatives to crude oil production for Nigeria as the nation and indeed the global community transitions to a net-zero energy system. The research organisation will undertake robust modelling to determine current and potential sectors that could sustainably replace revenue currently generated by the Nigerian government from crude oil production and exportation. The research organisation will provide data-backed answers to the following questions: 

  1. What sectors/industries/technologies can replace the foreign exchange and government revenue value currently being supplied by crude oil production in Nigeria by 2060? 

  1. What actions need to be undertaken and when, to scale said sectors/industries/technologies in time for the Nigeria 2060 net-zero target? 

  1. How can the identified sectors/industries/technologies be developed to also address the expected job losses in the oil sector due to the energy transition? 

  

Scope of Work 

The research organization will be expected to: 

  1. Articulate the contribution of the oil sector to Nigeria in terms of government revenues and foreign exchange over at least the past two decades to demonstrate value gap that proposed sectors/industries/technologies must fill; 

  1. Identify at least 4 sectors/industries/technologies that can potentially fill this gap; 

  1. Develop a robust model for Nigeria that incorporates multiple scenarios based on projected global demand and supply streams for identified sectors/industries/technologies, including cost data/projections, macroeconomic realities and other helpful indicators to quantify the potential value of identified alternatives to oil production in 2060 and priority ranking of alternatives; 

  1. Model probable trajectories of the Nigerian oil and gas sector given current production, existing local policies and global realities including, but not limited to, the Russian-Ukrainian crisis and global climate response, to quantify potential value in 2060 and further strengthen the case for the exploration of alternatives; 

  1. Incorporate and highlight the gas sector in analyses with a focus on enabling gas-sector specific deductions; 

  1. Review previous economy diversification plans in Nigeria to highlight best practices, missed opportunities and key takeaways; 

  1. Advise on list and timeline of required activities as well as necessary incentives to scale promising alternatives for the replacement of revenue from oil production and exportation; 

  1. Obtain qualitative evidence on likelihood of adoption of suggested activities for example, using key informant interviews. 

 

Approach, Timeline, and Deliverables  

Approach: The selected research organization will maintain close contact with the ETO’s Research Specialist throughout the assignment and participate in biweekly project coordination meetings and/or as required by ETO and present status reports on its approach, findings, challenges, and next steps. 

The selected firm should make a concerted effort to ensure gender parity throughout this assignment. This includes, for example, the team deployed for this purpose is encouraged to implement a 40:60 female-to-male ratio. 

Timeline and Deliverables: 13 February 2023 to 31 August 2023. The selected organization will produce the following deliverables according to a schedule to be agreed upon with the ETO:  

Deliverable  

Milestone timeline 

Inception report outlining initial literature review, work timelines, data sources and gaps, and design method tools within a month of contract execution 

13 March, 2023 

Collated datasets and eventual Nigerian model 

13 April, 2023 

Draft and final reports outlining identified alternatives with potential 2060 values, trade-offs and recommendations 

30 June, 2023 

Sensitization and peer review/ Policy briefs and presentations 

31 July, 2023 

Final Report 

31 August, 2023 

  

Travel  

The work is expected to be conducted remotely. No travel is anticipated. 

 

Reporting  

The consultant will report to the ETO’s Research Specialist. 

 

Qualification and Expertise  

The research organization must have a proven track record of delivering high-quality models and results that support robust policies and decision-making. Organizations wishing to submit a proposal should have the following characteristics:  

  • Be affiliated with a top-tier research university; 

  • Capability and proven experience in providing analytical basis for policymaking; 

  • Capability and proven experience in engaging governments and government Ministries, Departments and Agencies (MDAs) particularly in Africa; 

  • Capability and proven experience in both qualitative and quantitative research methods, with experience delivering interdisciplinary research projects; 

  • Capability and proven experience in developing comprehensive, economy-wide energy systems’ models; 

  • Extensive knowledge of and experience in Africa with a focus on the energy landscape. Experience in the Nigerian context with Nigerian representation on research team is mandatory.  

  • Educational background and relevant experience in oil and gas, energy economics, energy systems modelling, macroeconomics, energy engineering, or other related fields across team.  

  

Bidding Process  

Bidders are allowed to submit bids as a consortium. Proposals must include the following (in either PDF or PPT format).  

Technical Proposal: 

  • Your organization’s profile including organization’s name, address, contact information and a brief background.  

  • Your organization’s understanding of the assignment, including any proposed changes to the Scope of Work.  

  • Proposed team structure. Principal investigator should have at least 15 years’ experience in researching complex energy systems 

  • Proposed approach (Gantt chart with key milestones, activities, and any sub-activities). 

  • Relevant experience and examples of work.  

  • Key personnel profiles and roles of subcontractors, where applicable.  

  • References (at least 3).  

Financial Proposal: 

All costs must be in USD  

  • Detailed financial proposal inclusive of LOE, travel, equipment costs and any other costs expected to be incurred.  

Technical and Financial proposal are meant to be submitted as separate documents.  

 

Evaluation, Conflict of Interest, and Terms of Payment 

  • Bidders are requested to disclose and explain any potential conflicts of interest.  

  • Terms of payment at SEforALL follow a deliverable based framework. The breakdown of the milestones-payments will be communicated to the selected company. 

  • The evaluation of proposals will be based on a 70 – 30 split for technical proposal and financial proposal, respectively. 

 

How to Apply and Deadline 

Please submit your proposals to procurement@seforall.org by 03 February 2023, 23:59 CET 

In case of questions or queries contact SEforALL at procurement@seforall.org