41 Nigeria’s unacceptable biofuels policy

This was first published on November 17, 2010 in 234NEXT[1]

At the time the barrel price of crude oil shot up, the world began to sing the biofuels song. Biofuels were touted as a replacement for fossil fuels and the answer to poverty and even the climate crisis. They were presented as being both renewable and environment friendly.

Moreover, it was said that they would not compete with food crops in terms of land uptake, as some of them would be grown only on degraded and marginal lands. The idea of biofuels giving fossils fuels a good fight was so widespread that the formation of a ‘green’ OPEC was proposed.[2]

Research has shown that biofuels are just as harmful to the climate as fossil fuels when factors such as loss of soil carbon and deforestation are computed. It has been proven that the energy output is actually same or less than what it took to cultivate, process, and transport the fuels. Thus, biofuels are not so green.

The reality of the push for biofuels is that they quickly metamorphosed into agrofuels— targeting food crops and pumping foods into machines rather than empty stomachs. The food crisis that hit the world when commodity speculations, conversion of grains into fuels, and other factors drove food prices up, forcing the mantra of agrofuels of the energy saviour of the world to be re-examined.

Lester Brown, of the Earth Policy Institute, warned in 2007, for instance, that the ‘grain it takes to fill a 25-gallon (95 litres) with ethanol just once, will feed one person for a whole year.’[3] In the same year, the United Nations special rapporteur on the right to food, Jean Ziegler, described agrofuels as a ‘crime against humanity’, and called on governments to implement a 5-year moratorium on their production.[4]

The Nigerian biofuel policy has been gazetted as Nigerian Bio-fuel Policy and Incentives No. 72 Vol 94 and is dated June 20, 2007. Let us briefly look at what the wholesale adoption of the agrofuels highway means to Nigeria and the world.

The push for agrofuels has meant a massive uptake of lands for the cultivation of oil palms, corn, cassava, sugar cane, and jatropha, among others. It has translated to land grabs in Africa, loss of lands by pastoralists to jatropha in Africa and India, and slave-like engagement of farmers as mere outgrowers in many parts of the tropical world.

The rush for agrofuels has some benefits, but the benefits have been for agribusiness, and the losers are small scale and family farmers and pastoralists.

In Nigeria, this rush saw cassava as the major target, with large swaths of farmlands being set aside for cassava to be converted into ethanol. Jatropha has also been an attraction with one company allegedly promoting its cultivation in Ogoni land for the production of what they cheekily call Ogoni Oil! In many parts of Northern Nigeria, the best-watered lands, often along rivers, have been grabbed for agrofuels cultivation.

In many cases, communities have been cajoled to give up their lands and become farm hands to big business on the promises of regular income and a better life that often is nothing more than a mirage.

Biofuel policy

The Nigerian Bio-fuel Policy was produced, packaged, and delivered by the Nigerian National Petroleum Corporation (NNPC) without any public participation. It follows the signature pattern of oil sector arrangements where everything is skewed in favour of corporate actors while the environment is opened to nothing except exploitation.

The policy allows for massive tax breaks and all manners of waivers— exempting the operators from taxation, withholding tax and capital gains tax. They are also exempted from paying import duties and other related taxes on the importation and exportation of biofuels in and out of Nigeria. Moreover, for the first 10 years, such companies would not have to pay excise duties and would also not be required to pay value-added tax.

For what is known as the seeding stage, Nigeria is expected to engage in large-scale biofuels importation. This appears to follow the path already well oiled by the NNPC, a path where Nigeria exports crude oil and still depends on imports of petrol to meet our domestic needs. Starting off with massive biofuels imports may be a clever way of not kick starting the use of the fuel but of entrenching the dependence on imports.

The biofuels policy also recommends a most liberal loan system for the industry, with the funds coming from an ‘Environmental Degradation Tax’ that would probably include fines from gas flares. The policy expects to profit from continued massive environmental degradation in the oilfields of the Niger Delta, rather than taxing polluters and utilising the funds to detoxify the degraded Niger Delta environment. The policy aims to benefit from the crude oil and also from the damage inflicted on the land and the people.

Instead of requiring that the biofuels sector strictly obeys the Nigerian EIA Act of 1992, this policy requires the Federal Ministry of Environment to ‘prescribe standards’ for the conduct of Environmental Impact Assessment of biofuels projects. It appears the plan is to ensure the subversion of subsisting laws and regulations.

The policy says nothing about the social and other impacts assessments that an industry of this sort requires. The idea is to build up sacred cows, as seen in the oil industry with its jaundiced joint venture arrangements that allow fines and charges (including community development project costs) to be computed as production costs and, therefore, never touch the profits of the oil companies. In addition, it sees local farmers as outgrowers, with no sense of ownership or control in the entire scheme.

The present Nigerian biofuels policy must be repealed and public debate opened over what sort of policy is needed for this sector.


  1. Now available at http://nigeriang.com/money/oil-politics-nigeria’s-unacceptable-biofuels-policy/5610/ (accessed 15 June 2016)
  2. Adam Ma’anit. A Green OPEC? http://newint.org/blog/editors/2007/01/28/a-green-opec/ (accessed 7 June 2016)
  3. Lester R. Brown. Food or Fuel? http://www.earth-policy.org/mobile/books/fpep/fpepch4 (accessed 7 June 2016)
  4. http://www.un.org/apps/news/story.asp?NewsID=24434&#.Vv03-seYdFI (accessed 7 June 2016)

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