‘Why Nigeria’s Power Generating Capacity Has Been Dropping’

by on April 22, 2016
• BPE bemoans 40-year investment gap
The country has been losing an average of 3,630 mega watts (mw) of electricity due to gas, frequency, line limitations and water management constraints.

Indeed, the power generating capacity slide has in recent times become more pronouced. For instance, the country lost 3,136mw to these constraints on April 11, which increased to 3,497mw the next day, followed by 3,604mw; 4,222mw; 3,611mw; 3,613mw and 3630mw on April 17, 2016.

Worried by the unsavoury trend, the Vice President, Prof Yemi Osinbajo, has called for an expedited repair of the strategic Forcados pipeline to ameliorate the gas supply deficit to power plants in the country.

Speaking during his visit to the Forcados Terminal in Delta State, Osinbajo said President Muhammadu Buhari is concerned about the damage done to the terminal in February and asked him to visit and assess the situation which has been responsible for the recent drop in electricity supply in the country.

“The damage done to Forcados affects our oil earnings but also as important is the power aspect. Forcados is a major source of gas, about 40 per cent of our gas supply is affected leading to the problem of power supply in the country”, he added.

Osinbajo pointed out that few months ago, power supply in the country had peaked at an unprecedented 5000mw, but now has dropped significantly including instances of system collapses, showing that this is “a real problem.”

He said: “I came here on the instruction of the President who is concerned about the damage done to Forcados. I came here to see for myself and underscore the great implication for the nation’s economy. Many people don’t even know that power supply is hampered by what is going on here.”

Meanwhile, the Bureau of Public Enterprises (BPE) has attributed the current electricity challenges in the power sector to lack of over 40 years investment in the industry.

The Acting Director-General of BPE, Dr. Vincent Onome Akpotaire, said that the lack of investment in the sector in the past 40 years had now come to the fore with the privatization of the sector and that immediate solutions would not be achieved within two years of privatization.

He however said with the steps taken by the Federal Government so far to address the prevailing challenges there was a hope of efficient and effective power supply in the country.

Akpotaire maintained that continuous interactions coupled with the commitment of the power operators and the political will of  the Federal Government were critical to resolving the emerging challenges in the sector.

The Acting BPE boss who stated this during an interactive session with the Chief Executive Officers (CEOs) of the 11 Power Distribution Companies (DISCOs) in Abuja recently, noted the challenges in the power sector but opined that with concerted efforts by all critical stakeholders in the sector, these were surmountable.

He called for an enhanced synergy between the Successor Companies (SCs) of the defunct Power Holding Company of Nigeria (PHCN) and the Bureau to boost efforts towards actualising the full objectives of the power sector privatisation.

While acknowledging that there were fundamental challenges within the sector, he stated that these were not insurmountable if given time; inter-agencies collaboration; and adequate investment.

He enjoined the SCs to improve on their efforts to honour the performance agreement in the power privatization, stressing that “I am optimistic that with the required synergy, periodic reviews with stakeholders and commitment to the performance agreement, the objectives for the nation’s power sector would be achieved.”

On the prayers sought by the SCs, the Acting Director informed them that the Bureau was not an approving agency but the Secretariat of the National Council on Privatisation (NCP). He said the essence of the interaction was to look at the contending issues with a view to escalating them to the NCP.

Speaking on behalf of the Successor Companies (SCs), the Managing Director of the Ibadan Electricity distribution Company (IBDEC), Mr. John Donnachie, acknowledged the Federal Government’s efforts at managing the issues militating against the sector.

He said that the DISCOs and GENCOs had benefited from such efforts through the National Integrated Power Project (NIPP), Niger Delta Power Holding Company (NDPHC), Nigerian Bulk Electricity Trading Plc. (NBET) and the Central Bank of Nigeria’s (CBN)’s  N213 Billion intervention fund.

On the implementation of a cost reflective tariff, the MD. IBDEC said that it was a step in the right direction but that the deadline by the Federal Government to the DISCOs to meter 1million customers within a year was not realistic.

He added that the cap on the DISCOs’ Capital Expenditure (CAPEX) was a hindrance to meeting the deadline. The IBDEC Chief Executive explained that metering was a capital intensive venture and a key component for implementing the new tariff which only massive investment in the sector would bring Nigeria closer to the Promised Land.



Be the first to comment!
Leave a reply »


Leave a Response