A Review of the Nigerian Energy Industry

Nigeria not ready for bilateral trade in electricity — MAN

US dollars26 August 2014, Lagos – The Nigerian Bulk Electricity Trader, NBET, has not demonstrated the readiness to midwife bilateral trading in electricity, said the Chairman, Manufacturers Association of Nigeria, MAN Apapa branch, Mr Babatunde Odunayo. This is even as some private sector companies are already developing the interest and capacity to sell power to the distribution companies, DISCOs.

Odunayo also argued that the 2016 20.3GW power generation target set by President Goodluck Jonathan would not be achieved with the present unsupportive state of the transmission system in the country.
He spoke at the Association’s 2014 Business Luncheon tagged, “Improving Power Distribution and Generation: Experience and Expectation,” in Lagos.

According to him, heavy investments in independent power projects, IPPs, are still required to push towards the realisation of the power supply goal.

He said, “The Chairman of Nigerian Electricity Regulatory Commission, NERC, Dr sam Amadi, may wish to inform us that the country may be coming to the end of the liberalisation and privatisation phase of the Power Sector Reform. However, we are not sure that we are ready for bilateral trading in electricity through the NBET, so that private sector investment in IPP projects can be hastened.”

He decried the fixed charges on electricity billed by the DISCOs, and called for its abolition until the generation and transmission systems are able to overcome the challenges in power delivery value chain.

He therefore called on the NERC to mandate the DISCOs to source for funding to close the existing metering gap in the country, as this would help to plug the revenue leakages in their areas of operations. .

“A few questions arise for NERC. How do we determine 15 days of non-supply of power to the consumers at which point the fixed charge does not become payable by the consumer? Is it cumulative, if so who takes a record of outage? Is it for 15 consecutive days? The general feeling is that the fixed charge should be abolished.

“How shall housing Estates be regulated through the distribution companies? They promise 24 hours power supply services, take no cognisance of the energy from public power supply and charge their captive and helpless residents exorbitant rates per kilowatt hour,” Odunayo stated.
Other speakers at the event were Dr Mike Uzoigwe, Managing Director, MD Egbin Power Plant Plc; Mr. Oladele Amoda, MD, Eko Electricity Distribution Company; and Mr. Abiodun Ajifowobaje, MD, Ikeja Electricity Distribution Company.
They blamed the existing power supply shortages on inadequate gas supply to feed the existing generation plants, as well as increase in the Aggregate Technical, Commercial and Collection, ATC&C, losses.
They noted that inadequate power from the grid, energy theft and high rate of vandalism of electrical installations are also compounding the power supply problem.
They listed other problems to include high energy losses, lack of adequate and efficient metering, aged network, unsafe and untidy network system and manually operated distribution system among others.
They said there is the need to increase the present tariff system, saying that no investor would be willing to come in without having adequate return on investment.


– Vanguard

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