Nigeria’s Electric Power Sector has sadly defied all “solutions”, and it is rather getting worse. The week between the 13th and 21st of January witnessed one of the epileptic performance of the National grid in modern history, with as many as ¾ system failures per day.
When this new government got to power, I granted an interview with Leadership Newspaper, in which I was asked to forecast the outlook. I was very careful to note that since this government has made such lofty promises without saying in particular how they hoped to achieve it, it is better we wait for their actions.
When the first call of the then New Minister of Power, Works & Housing was to accede to the incessant demand for a Market reflective tariff by the operators – mostly DISCOs, I knew the Minister, and the APC Government had, and has no blueprint to get Nigeria out of this energy poverty misery.
It is unfortunate and sad that the APC government’s promises has turned out to be phantagoristic.
The general output to the National Grid today hovers between 1200MW and 1800MW, with lots of media blackout as to the true state of the Power sector.
I have over the years articulated and advocated for alternative and hard ways out of this impasse we found ourselves. Our Power Sector problem spreads over the whole spectrum of the power sector ecosystem, and there is only one way is to approach this sincerely and holistically, with National Interest at heart. I will try to highlight some of them again in this article.
One of the major failures in our power generation remains that ill-conceived policy to focus on Gas as the main source of fuel. This has been treated in an old article.
Nigeria is blessed with almost all the natural resources you can think of, one of which is Natural Gas. Other sources include Brown Coal, Black Coal and Bitumen. We are also blessed with Hydro, Wind, Solar, even raw materials for nuclear power plant is available.
So the question is: What informed that decision to kill other fuel powered plants and starts installing Gas powered plants?
We have tried this for over 35 years, and it has not worked. Yet we are being lazy to think right out of the problem?
It is unfortunate that we should still be having Transmission as a major problem today in Nigeria. With bare capacity to wheel more than 5, 500MW (recent figures says last simulation has increased Transmission capacity to 7, 200MW) from Generation to Distribution, and attendant technical loss of over 35% (what this means is that over 35% of whatever is taken from Generation point is lost before it gets to Distribution companies), the future of TCN seems bleak!
Nigeria is a very big country, and really, it doesn’t make sense to generate power from Egbin, wheel it to the National control center, before you then send it back to Lagos. It JUST DOESN’T MAKE SENSE!
Solution: Break down the country into Zones, let each Zones takes care of itself. Let each Zones have its own major source of electricity, and it is distributed within each Zones. Solves major problem.
Countries like England, Mexico and Brazil has more than one National Grid, why not Nigeria?
Distribution companies faces the biggest challenge, and are also the biggest threat in the while Power Ecosystem.
From faulty Billing Systems to inability to Meter Customers, to very poor customer care, and all the things you could ever think of, like rejecting allocations from the National grid itself.
The truth is: Most of, if not all, these DISCOs are insolvent and just living and going along.
The worst part is that the Distribution Companies are the ONLY source of generating revenues for the whole power ecosystem.
Some of the key performance indices for the Discos is the reduction of the Technical and Commercial Losses, and the closing of the Metering gap, both of which they have failed woefully at it. This takes us to the next point
The regulatory body, Nigeria Electricity Regulatory Commission, has been the laziest and irresponsible organization itself, and it has casted serious shadows and doubts on the Electric Power Sector Reform Act that governs the Power Sector Reforms.
I am not sure there is any irresponsive and toothless regulator anywhere like NERC and its constituents. And no one else has flouted the EPSR Act more than the Regulators that are supposed to be its guardians.
My recommendation from day one is the proper constitution of NERC and the audit of its activities from inception.
A substantive Head of the Commission should be appointed by the President Muhammodu Buhari.
Federal Ministry of Power, Works and Housing
Even though this is a political policy making department, it is highly recommended that a knowledgeable and experienced technocrat should be made to head the Power Ministry.
Resolving the power sector doldrums requires experience, and know how. Mr. President should look into this.
It is a known fact most distribution companies are presently insolvent, and are barely staying financially afloat.
It is also a known fact that the risks for loans from banks remains high, in fact, lots of Power Sector Loans are non-performing.
But It has also been suggested that Power Sector companies should consider playing on the stock exchange floor so they could raise the required funds.
All these will remain impractical without strong Regulatory environment and stable national electric power policy. This should be worked on.
National Interest Policy
I have remained an advocate of National Interest Policy that will clearly map out what our goals are, and how we, as a Nation, will achieve these goals.
Our major problem should remain how we are going to deliver cheap clean energy to the Nigerian populace that has hit over 220million, and how we are going to leverage on this to provide jobs and power industries.
The main calamity would be our inability to provide for the 220 million strong Nigerians, without a clear direction and momentum.