APPLYING THE CONCEPT OF DECENTRALISATION TO THE NIGERIAN POWER SECTOR

I do not know about you but the abysmal power supply of recent has been a thorn not only in my side but in my wallet as well. It boggles my mind that in 2024, we are still battling with issues of power in a developing economy such as Nigeria. In my opinion, I believe that the people in charge know what to do but have refused to do it either for selfish or lazy reasons to benefit a few. I woke up this morning and after dropping my daughter off at school, I had to begin looking for a petrol filling station to buy fuel for my generator because my inverter had died and all the filling stations in my area did not have fuel to my utter frustration.?

Nigeria has many challenges, but one thing has never been a challenge for us. The ability to think and deliver innovative solutions to the pains that we have to go through every day. Just look at the Telecommunications and Financial services industry, especially the Fintechs. We did that! Why can’t we do the same with power?? For example, some of the pain points identified in the payment sub-sector of the financial services industry were the centralization of payment processing including data privacy concerns, data protection and fraudulent transactions. Another major challenge was that when the central hub was down, everyone could be impacted negatively. This brought about the talks of decentralization using blockchain technology to help mitigate these challenges and drive financial inclusion.

These challenges seem familiar and also plague the Nigerian power sector, especially electricity generation and distribution. The power sector in Nigeria faces numerous challenges, including inefficiencies, corruption, and lack of transparency. Blockchain technology, with its inherent principles of decentralization, transparency, and immutability, holds immense potential to address these issues and revolutionize the power sector.??

Some of the use cases that can be applied using blockchain technology in the power sector are:?

• Decentralised power generation: The idea of having a National Grid that keeps collapsing every month is no longer sustainable. Can we explore the option of having state-owned grids? or regional? Or states coming together to own one??
• Decentralised energy trading platforms: Decentralized energy trading platforms leverage blockchain technology to enable peer-to-peer (P2P) trading of energy between producers and consumers, bypassing traditional centralized intermediaries like utilities or energy companies.
• Transparent and Automated Billing Systems: All billing-related activities, such as invoicing, payment collection, and reconciliation, are recorded on the blockchain in real time, allowing stakeholders to track and verify billing information transparently. This transparency helps build trust among parties involved in the billing process and reduces disputes or discrepancies.
• Smart Grids and Metering Solutions: Smart grids are modern electrical grids that integrate digital communication and control technologies to optimize the generation, transmission, and distribution of electricity. By providing accurate and timely consumption data, smart metering solutions enable utilities to implement demand-side management strategies, optimize load distribution, and improve billing accuracy. Smart metering solutions facilitate the implementation of time-of-use tariffs, where electricity prices vary based on the time of day or demand levels, incentivizing consumers to shift their energy usage to off-peak hours and reduce overall electricity costs.
• Renewable Energy Integration and Peer-to-Peer Energy Sharing: This involves incorporating sources of renewable energy, such as solar, wind, hydroelectric, and biomass, into the existing energy infrastructure. Renewable energy integration requires the deployment of technologies such as solar panels, wind turbines, and hydroelectric generators to harness energy from natural resources and convert it into electricity. Peer-to-peer (P2P) energy sharing enables individuals or organizations to trade surplus energy directly with one another, bypassing traditional energy utilities or intermediaries. Participants in P2P energy-sharing networks include producers of renewable energy, such as homeowners with solar panels or small-scale wind turbines, and consumers who wish to purchase clean energy from local sources.?

If we apply the decentralization principle to power in Nigeria, we will enjoy some of the following benefits and grow into the full potential of our country:?

• Improved Efficiency and Reliability
• Enhanced Transparency and Accountability
• Reduced Costs and Revenue Leakages
• ?Empowerment of Energy Consumers
• Promotion of Renewable Energy Adoption

We will also need to overcome these challenges but If we truly commit, I know it can be done:?

• Regulatory and Legal Frameworks
• Technical Scalability and Integration
• Data Privacy and Security Concerns
• Stakeholder Engagement and Adoption
• Interoperability with Existing Infrastructure

The application of decentralized blockchain solutions in the Nigerian power sector presents a transformative opportunity to address longstanding challenges and drive positive change. By embracing principles of transparency, accountability, and efficiency, blockchain technology can revolutionize energy distribution, consumption, and management, paving the way for a more sustainable and inclusive energy future in Nigeria.

This article is just a summary of what we can achieve if we begin to seriously consider decentralization of power in Nigeria. We can always start by decentralizing power generation and take it from there. I don’t know about you, but I am truly tired of hearing about our National Grid collapsing every seven days.?

I look forward to your opinions and suggestions for better power supply and improved standard of living for us all in the comment section.