A Review of the Nigerian Energy Industry

Gambian lawmakers approve $31.9m energy grant

power transmission station16 January 2014, Banjul -Deputies at the National Assembly Wednesday unanimously approved an energy grant of US$31.9M during the first sitting of the National Assembly in the 2014 legislative year. The “Emergency electric power supply programme” to the Greater Banjul Area is an agreement signed on December 16th, 2013 between The Gambia government through the Ministry of Energy and the Commission of the Economic Community of West African States (ECOWAS).

It has the objective of addressing the rehabilitation and maintenance of diesel generators and auxiliary equipment, fuel and lubricant procurement, and capacity building support to project management, as well as payment preparation, monitoring and coordination cost by WAPP as the implementing agency of the programme. Tabling the motion, the Trade, Integration and Employment minister, Abdou Kolley, who stepped in for the Energy minister, said that this financial support came as a result of President Jammeh’s request to the ECOWAS Commission to help the National Water and Electricity Company (NAWEC) stabilise its current operational and financial difficulties. “Electricity generation in The Gambia is mainly dependent on fossil fuel (heavy fuel oil and diesel), which is the most expensive mode of electricity generation, especially for an oil importing country like ours. Thus, the frequent fluctuation of international oil prices over the years has seriously affected the operations of NAWEC and has been the prime mover of electricity tariffs. NAWEC is purchasing fuel at increasingly high prices and this consumes more than 50% of the company’s revenue. Even though electricity tariffs are high, they are still not reflective of the real cost, thus making the situation difficult,” he told lawmakers.

The Trade minister underscored that access to adequate, reliable and affordable energy is fundamental and a necessity for the achievement of the aspirations and developmental objectives enshrined in the Programme for Accelerated Growth and Employment (PAGE) and Vision 2020. Kolley argued that there cannot be any meaningful development without access to affordable, reliable and sustainable energy, thus noting that the importance of this investment cannot be less underscored.

“The energy sector has been identified worldwide as a major tool for promoting investment and regional co-operation and integration and can also be used for improving the competitiveness of economies of countries. Evidence from countries around the world indicates a direct relationship between investments in the energy sector and poverty reduction,” he remarked.

Kolley pointed out that inadequate financing has been one of the major factors contributing to the problems and failure of some of the already existing energy networks, whilst NAWEC is undergoing very difficult times. In addition to fluctuating oil prices, the minister lamented that electricity losses are currently at 22% due to ageing infrastructure even though this has been reduced from 30% due to upgrading and refurbishment of some parts of the network through the Venezuela loan. He told lawmakers that further reduction of electricity losses to acceptable levels would require huge investments in generating plants and transmission and distribution infrastructure. But this, he said, has been a major concern to the government of The Gambia as well as the development partners, whom he said, have over the past decade, been making interventions to improve the situation in order to spur the economy.

“The grant therefore seeks to promote the development and sustenance of the energy sector in The Gambia particularly in the Greater Banjul Area. It is expected that this grant would help achieve greater energy sufficiency and thus reduce the unsustainable exploitation of forest resources to support the socio-economic activities of The Gambia,” he emphasised.

Kolley concluded by assuring deputies that the Ministry of Energy working with NAWEC as direct beneficiary of the grant, the West African Power Pool (WAPP) as implementing agency and other stakeholders will work assiduously towards the successful implementation of the project as agreed with the ECOWAS Commission. “We continue to call on the support, cooperation and understanding of all, for the benefit of our people,” he enjoined.

Seconding the motion, the Majority leader and NAM for Serrekunda East, Hon. Fabakary Tombong Jatta thanked the minister for ably negotiating the agreement, noting that the grant would boost the operational efficiency of NAWEC.

The member for Foni Brefet, Hon. Bintanding Jarju, said the grant is a clear manifestation of the regional integration promoted by The Gambian leader.

– The Observer






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