A Review of the Nigerian Energy Industry

Power Ministry’s pledge for 10, 000mw rekindles hope

Prof Chinelo Nebo31 August 2013, Abuja – Nigeria’s Power Minister Professor Chinedu Nebo recently affirmed that come December 2013, Nigeria will experience an improved power supply. Such promise has been a recurring issue; hence many Nigerians will simply see it as the usual.

However Nebo’s promise requires some salient analysis to determine if he is saying the usual or if the time for rejuvenated Nigeria’s power sector has come. Why his case may be given some atom of interrogation could be his classic performance while in the saddle of the University of Nigeria, Nsukka, as vice chancellor as well as other positions the Anglican clergyman has found himself in the past.

Nebo’s pledge of soon-to-be uninterrupted power supply was also re-echoed by the minister of state for power, Hajiya Zainaib Ibrahim Kuchi. In her words, the power generation will peak at 10,000 megawatts by the end of December 2013. If this feat is achieved, no doubt, it will mark a new dawn in Nigeria’s power quest. According to her, the power generation increase would translate to between 17 and 18 hours of power supply in the country.

One basic hindrance, according to Nebo, has been the transmission challenges, which make attempts at putting 5000 megawatts into the transmission network unworkable.

A milestone in Nigeria’s improved electricity quest is the effort at repositioning various Nigerian Independent Power Plants as well as the Niger Delta Power Company, which is billed for commissioning in December this year. Records show that this will generate 10, 000 megawatts in December 2013.
Research indicates that Iran generated 90MW in 1948, 1,500MW in 1970 and 7,025MW in 1978. Her population is 75 million, and its power capacity is put at 43,000MW.

This is against Nigeria’s fledgling 4,000MW serving its over 160 million inhabitants. South Africa is reputed to produce an average of 800 watts per person, but Nigeria’s per capita consumption revolves around 30 watts per person. Mathematically Nigeria can only attain the same level as South African per capita consumption if its power generation gets to 110,000 megawatts.

The effort of the Ministry of Power in improving the nation’s megawatts astronomically is quite commendable. What has become clear is that Nigeria’s power sector can only be improved upon drastically with the massive involvement of the private sector. This calls for the privatisation and commercialization of the power sector to meet the demands of Nigerians.

The Nebo-led ministry of power has toed this line through the Independent Power Projects (IPPs), which has brought with it great expectations. The initiative marks the determination of the ministry to ensure that Nigerians have the ownership of the scheme with some foreign, direct investments. This signals that there will be a synergy in building consortiums while the IPPs address matters concerning power requirements.

The assumption of office by Nebo as power minister in February 2013 has rekindled the hopes of Nigerians once more that there is light at the end of the tunnel. The launching of the Roadmap for Power Sector Reform seems to be the most significant effort in the power sector ever. The scheme specifies a blueprint of the Electricity Power Sector Reform Act (2005) as a reaffirmation in setting the path for power sector improvement.

Another success story of the power ministry under Nebo is the re-instatement of the Nigerian Electricity Regulatory Commission.

So far, the efforts of the power ministry have been in tandem with the Jonathan administration’s pledge to solve Nigeria’s perennial power quagmire. Jonathan’s vision in unbundling the Power Holding Company of Nigeria (PHCN) into 18 companies to enhance productivity and efficiency has proven to be the best decision ever taken.

The creation of the Nigerian Bulk Electricity Trading Plc has also brought light in achieving Nigeria’s electricity dream in the near future. It would be recalled that Jonathan inaugurated the CEO and board of the Nigerian Bulk Electricity Trading Plc in August 2011.

Another stride in this sector which has made the environment conducive for the private sector participation in the power sector is the coming on board of a credit-worthy NBET Plc. This firm has become the springboard in boosting the morale of the power generating companies that they will be paid for power produced. The administration also flagged off the Energy Efficiency and Energy Conservation Lighting Scheme.

The goal of this project is to encourage the use of energy efficient bulbs and lighting systems which are capable of massive energy conservation. To wrap it up, the Jonathan administration entered into an MOU with worldwide leaders in the power sector, General Electric.

The deal indicates that General Electric will invest about 15 percent equity in power projects in Nigeria. This rounds up to 10,000MW capacity by the year 2020. The power firm also plans to build packaging facility with local contents for small aero-derivative turbines in Nigeria which will promote job creation.

So far, Nigeria now boasts of between 3000 and 4502 megawatts as at December 2012. Although it is paltry compared to what Nigeria genuinely requires, but it is a sign of positive development because it remains the highest of such record since the new democratic dispensation came on board in 1999.

As year 2013 tickles, the December promise of 10,000 megawatts by the minister of power seems realizable. This seems feasible because the entire ten power plants under the National Integrated Power Projects (NIPP) scheme will be completed and rolled into operations this year.
*Umaru Ardo, Vanguard

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