TCN’s inefficiency may erode investment in elctricity sector, NERC, NCP warn

PHCN01 October 2013, Abuja – The Nigerian Electricity Regulatory Commission, NERC, has raised the alarm over the slow pace at which the board of the Transmission Company of Nigeria, TCN, is handling federal government’s mandate to it to swiftly attain sustainable efficiency in Nigeria’s emerging electricity sector.

The commission expressed concern that the TCN’s inefficiency and sluggish attitude to its responsibilities could undermine further investments in power generation and distribution.

Chairman of the NERC, Dr. Sam Amadi, in an interview in Abuja, said he was scared of possible risks from the sluggish attitude of the TCN to its tasks, noting that the company and its staff members were yet to come to terms with the obvious paradigm shift in Nigeria’s power sector as a result of the privatisation exercise.

He said: “I am not only bothered, I am scared. I am scared about TCN. A reform is tolerant and value based, I have argued that Nigeria’s problem with the sector is not technical issue; it is ideas, ethical and an adaptive challenge.

Amadi added: “What the reform in the power sector is doing is to change the mindset primarily. So that we begin to have the mindset set away from seeing power as social service. The regulation analysis gives us cost reflective tariff, which is technical and adaptive.”

According to him, “Transmission is a risk not because there is no money; funding is a big deal or a risk because it is still government owned, but because its inefficiency will undermine further investments in generation and distribution and what is paramount now is to allow transmission to be regulated, which means you don’t appoint people without approval but appoint based on competency”.

Speaking in the same vein, Chairman of the Technical Committee of the National Council on Privatisation, NCP, Mr. Atedo Peterside, warned of the danger posed by the seeming “pussy-footing” attitude of the reconstituted supervisory board of the TCN, adding that the board seemed lost with its expected responsibilities.

Atedo, who spoke on the next phase of Nigeria’s power sector privatisation exercise while presenting a paper at the “special forum on financing the power sector reforms for economic development” organised by the Bankers’ Committee said: “Transmission is the “life-blood” of this entire electricity eco-system and it is also potentially the weakest link at present. I am reliably informed that, currently, stranded capacity due to transmission evacuation constraints is in the region of 100MW. The other weak link is gas supply and gas transportation.”

He said the ability of the TCN to catch up with generation availability and also keep pace with future expansion will depend on its continued access to financing for its huge capex needs and its ability to execute and rigorously monitor project implementation to high professional standards.

Atedo added: “Unfortunately, the board of TCN is yet to get its act together. Since the appointment of a chairman and some initial board members was first announced some months ago, so much time appears to have been lost in squabbling over who does what, when and how. If TCN does not deliver the goods in 2014, there will be a crisis of sorts when the 10 NIPP power plants come on stream.”

The board, which is led by one-time chairman of the Revenue Mobilisation, Allocation and Fiscal Responsibility Commission, RMAFRC, Hamman Tukur, has been accused of showing minimal concern to the expected role of the TCN in the power sector that is gradually becoming private sector driven.

– This Day

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