The Oil Climax: Can Nigeria’s fuel subsidy reforms propel energy transitions?

Abstract

Recent studies in the field of political science and environmental resource governance suggest that oil-exporting economies have begun to implement fuel subsidy reforms. However, while most studies on this issue focus largely on the broader environmental and economic consequences of fuel subsidy reforms, few have examined specifically the effects on renewable energy transitions. Drawing insights from the literature on political economy and the multi-level perspective on socio-technical transitions, with empirical examples from Nigeria, first this study provides an explanation of which factors triggered fuel reforms on the basis of the interaction between landscape and regime elements and second the effects of such fuel reforms on renewable energy transitions. Findings suggest that landscape factors such as global oil crashes and pressures from international financial organisations played crucial roles in the drive for fuel reforms. Nonetheless, rentier regime members responded to these pressures by adopting institutional, discursive and redistributive measures. Of all three strategies, the institutional strategy was significantly pivotal in the proliferation of renewable energy in Nigeria. This study concludes by discussing lessons learned in shaping a transition away from fossil fuels in Nigeria and rentier countries in general.

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