A Review of the Nigerian Energy Industry

Nnaji worries over huge salary cost of PHCN workers



Abuja, Aug. 13, 2011 – The Minister of Power, Prof. Bart Nnaji, lamented on Saturday that over 80 per cent of the operational cost of the power sector, goes to paying salaries of PHCN workers.

Nnaji made the revelation in Abuja at a one-day retreat, organised by the ministry for its senior management staff on grade level 14 and above.

He said that distribution and transmission network of the industry had to grow yearly by at least 16 per cent rate, noting that the current average growth of energy per annum was less than one per cent.
The Minister attributed this to factors like obsolete equipment and limited investments in the sector.

Nnaji explained that current investments in the industry go into replacement of damaged equipment like transformers and switchgears.

According to him, only 40 per cent of the nation’s population has access to electricity supply.

He disclosed that the goal of the Federal Government was to restructure the industry such that it would be privately-driven.

Nnaji said that the Federal Government would privatise the sector into functional autonomous components of generation, transmission and distribution.

“We would want active participation of the private sector in the industry as well as outright transfer of assets to private stakeholders where applicable,” he said.

He said that several challenges like “vertical integrated government-owned monopoly that is not commercially viable, managerial inefficiencies and a lack of efficient investment in distribution, generation and transmission are factors slowing down development in the sector”.

The ministry’s Permanent Secretary, Mr Isa Sali, said that one of the major objectives of convening the retreat was to sensitise the management team on the power sector transformation agenda.

He said that the retreat would also enable the ministry to identify roles and responsibilities of stakeholders in the ministry’s transformation agenda.

Sali noted that the retreat was useful as it would afford the management an opportunity to interact with workers.

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