Effect of Government Incentives on Execution of Solar Power Projects in Southwest, Nigeria

Successful renewable energy projects are crucial to maintaining a cleaner and sustainable environment. Thus. it becomes critical for the government to intervene and provide incentives due to limited financial constraints by solar power developers, which ultimately impact on their ability to achieve their renewable energy goals. Therefore, this paper examined the effect of government incentives on execution of solar power projects (ESPP) in southwest, Nigeria. The study adopted a research survey design and a census population of 158 firms. The study retrieved and used 109 valid questionnaire collected from the top managers, representing about 69 percent. The data were collected using a digital questionnaire created with CSPro (Census and Survey Processing System). The study adopted inferential statistics of structural equation modelling (SEM). The SEM analyses showed that the variable of government incentive (β = 0.001; P > 0.05) was insignificant at 95 percent level. The insignificance of government incentives could be due to the fact that government incentives in Nigeria are too general or blanket in nature, failing to account for the unique needs and circumstances of individual solar power companies. Sustainability as control variable displayed significant negative relationship with execution of solar power projects in the southwest, which might be due to the high initial investment, lack of sufficient expertise in specific technical matters, inadequate stakeholders’ engagements, and environmental conditions in the region. The study recommended that government budget should support renewable energy fund and regular assessment of incentive programmes in order to boast investors’ confidence and participation in solar power industry. Governments and regulatory bodies should offer incentives for project developers that prioritise sustainability, aligning incentives with unique circumstances of the region. The findings have implications for policymakers, solar power developers, and investors seeking to promote the growth of the solar power industry in the region.