Two clean energy companies, Vara Energia Ltd and HydroThermIA Inc. of Canada, have presented a technical and commercial framework to the Federal Government aimed at unlocking Nigeria’s estimated $3bn annual carbon finance potential.

The proposal was presented during a technical session in Abuja with officials of the Mitigation Division of the Department of Climate Change at the Federal Ministry of Environment.

In a statement issued by Vara Energia’s chief executive officer, Segun Aikulola, the companies said the framework was designed to support industrial decarbonisation, clean hydrogen production and the development of Nigeria’s carbon market.

The initiative, according to the statement, aligns with the Federal Government’s climate commitments and the National Carbon Market Framework.

The companies said the proposal builds on discussions at the National Green Growth Dialogue, organised by the Nigerian Economic Summit Group (NESG) in collaboration with the Federal Ministry of Budget and Economic Planning under the theme, “From Commitments to Green Growth”.

They also cited the government’s climate governance structures and emissions-reduction commitments as opportunities for developing carbon finance and clean energy projects.

Under the proposed framework, the companies plan to deploy containerised technologies at industrial sites to address emissions from hard-to-abate sectors, including oil and gas operations.

The proposed systems would capture gas currently being flared and convert it into hydrogen and electricity, potentially reducing emissions while providing an alternative source of energy for industrial operations.

The framework also includes modular wastewater treatment systems integrated with hydrogen production, which the companies said could help industrial facilities secure water supplies and access lower-emission energy on-site.

Speaking on the proposal, Vara Energia’s executive director of commercial and business development, Ochonogor Uche Zoe, said the initiative could reduce industrial carbon emissions while creating alternative revenue opportunities for Nigeria.

He also stressed the importance of local technical integration and domestic manufacturing, saying Nigerian engineers should play a leading role in developing the clean energy sector.

The assistant director and head of the Mitigation Division at the Department of Climate Change, Dr Asmau Jibril, said the partnership aligned with the government’s climate objectives and the National Green Growth Dialogue.

According to the companies, the proposed technologies could reduce operating costs for heavy industries and upstream oil and gas operators by lowering dependence on diesel and unreliable grid electricity.

Vara Energia’s deputy chief executive officer, Victor Ntofon, said the initiative could attract foreign exchange through verified carbon credit revenues, create jobs and improve access to international climate finance, including green climate funds.

The companies also projected that the development of domestic clean hydrogen production could position Nigeria to supply hydrogen and ammonia to regional and international markets.

They called on the Presidency, the National Council on Climate Change and the Federal Ministry of Environment to support the proposed framework, while urging manufacturers and energy companies to explore participation in the initiative.

The companies said they remained committed to supporting Nigeria’s industrial decarbonisation objectives through technology deployment, local capacity development and investment in cleaner energy systems.