Landscape of Climate Finance in Nigeria

In 2019/2020, Nigeria received an average of USD 1.9 billion annually in climate finance, representing only 11% of the USD 17.7 billion needed annually for its conditional NDC. Public finance dominated at 77% of total flows, primarily delivered as concessional debt. Mitigation finance (USD 1.1 billion) outweighed adaptation finance (USD 663 million), despite high vulnerability to climate shocks. Energy systems received the most investment, particularly solar, while sectors like waste and industrial processes remained severely underfunded. The report highlights a significant contradiction between climate finance flows and continued heavy investment in fossil fuels, noting one LNG project alone received USD 2.77 billion. Key barriers include limited private sector mobilization, capacity constraints in GHG reporting, and a lack of national climate budget tagging.

• Nigeria's annual climate finance in 2019/2020 averaged USD 1.9 billion, which is only 11% of the estimated USD 17.7 billion required annually to achieve the conditional NDC target of reducing emissions by 47% below business-as-usual by 2030.
• Fossil fuel financing continues to overshadow climate finance; Nigeria ranked second in Africa for the number of financed fossil fuel projects between 2016 and 2021, with a single liquified natural gas (LNG) project receiving USD 2.77 billion, exceeding the total tracked climate finance for 2019/2020.
• Public actors provided 77% (USD 1.5 billion) of climate finance, while private sector investment lagged at 23% (USD 0.4 billion). Multilateral Development Finance Institutions (DFIs) were the primary public sources, contributing 55% of public flows.
• Climate finance is heavily skewed toward mitigation (USD 1.1 billion) over adaptation (USD 663 million), despite Nigeria being the 53rd most vulnerable and 6th least-ready country for adaptation according to ND GAIN.
• Debt is the primary financial instrument used, with concessional debt accounting for 46% and non-concessional debt for 25% of flows. Adaptation is particularly dependent on debt, which accounts for 90% of its financing.
• Energy systems received the largest share of climate finance (41%), with solar technologies (on and off-grid) accounting for 66% of that investment. However, these flows are dwarfed by the USD 14 billion Nigerians spend annually on small-scale diesel generators.
• Agriculture, Forestry and Other Land Use (AFOLU) received 16% (USD 301 million) of total climate finance, with 83% of these funds targeting adaptation. Forestry-related projects received only 1% of the sector's funding.
• Significant sectoral gaps exist in climate finance for Waste, Water and Wastewater, and Industrial Processes & Product Use (IPPU), with Water & Wastewater receiving only 2% of total tracked finance.
• Nigeria has established a green bond framework that catalyzed USD 165.1 million in finance between 2017 and 2021, though the broader bond market remains underdeveloped with limited private engagement.
• The report identifies critical barriers to scaling finance, including a lack of national climate budget tagging, limited technical capacity for GHG inventory management, and a lack of a national strategy for technology transfer.

APA

Stout, S., & Meattle, C. (2022). Landscape of Climate Finance in Nigeria. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2022/10/Landscape-of-Climate-Finance-in-Nigeria.pdf

Chicago

Stout, Sean, and Chavi Meattle. Landscape of Climate Finance in Nigeria. Climate Policy Initiative, 2022. https://www.climatepolicyinitiative.org/wp-content/uploads/2022/10/Landscape-of-Climate-Finance-in-Nigeria.pdf.

Wikipedia

{{cite report |last1=Stout |first1=Sean |last2=Meattle |first2=Chavi |title=Landscape of Climate Finance in Nigeria |publisher=Climate Policy Initiative |date=October 2022 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2022/10/Landscape-of-Climate-Finance-in-Nigeria.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{stout2022landscape, author = {Stout, Sean and Meattle, Chavi}, title = {{Landscape of Climate Finance in Nigeria}}, institution = {Climate Policy Initiative}, year = {2022}, month = oct, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2022/10/Landscape-of-Climate-Finance-in-Nigeria.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }