Decentralized energy transition in urban Nigeria: institutional barriers and policy pathways for hybrid renewable energy systems

Abstract Nigeria’s urban areas continue to face unreliable electricity supply, rising demand, and dependence on costly, polluting petrol and diesel generators. Hybrid renewable energy systems (HRES) — integrating solar, wind, and battery technologies — offer a viable pathway to provide clean, decentralized, and resilient power. This review critically examines the policy, institutional, and governance factors shaping HRES deployment in urban Nigeria, identifying the key barriers and reforms required to scale adoption. Findings reveal that expansion is constrained by fragmented regulation, weak institutional coordination, limited access to affordable finance, and fossil-fuel subsidies that distort energy prices and discourage renewable investment. Institutional overlap among the relevant agencies further constrains implementation. Technical barriers, such as limited local expertise, high component import costs, and poor grid integration, further elevate project risks and reduce system reliability. The study recommends regulatory harmonization under the new Electricity Act (2023), implementation of performance-based fiscal incentives, and expansion of green financing mechanisms to lower investment risk. Strengthening local manufacturing, research and development, and workforce capacity will be essential to reduce dependence on imports and sustain long-term growth. Finally, promoting gender equity, community participation, and inclusive business models can enhance social acceptance and promote fair distribution of the benefits associated with HRES across all urban populations. Collectively, these measures can accelerate Nigeria’s transition toward a cleaner, more reliable, and climate-resilient urban energy future.