*As TCN says nation needs $1bn annually to attain 20,000Mw by 2020
04 December 2015, Sweetcrude, Abuja – The Chairman of NERC, Dr. Sam Amadi, has said there has to be a regular supply of at least 6,000 megawatts of electricity before power outages can be significantly reduced in the country.
Amadi, who was speaking during a public hearing into the activities of the Nigerian Electricity Regulatory Commission, NERC, and Distribution Companies, Discos, as relates to infrastructure and billing by the House of Representatives Committee on Power, also disclosed that 55 per cent of consumers remain un-metered, attributing it to legacy issues which has resulted in consumers charged through estimated billing.
He lamented that the cloning of meters and bypassing meters remain a major challenge particularly in parts of the country, which results in loss of revenue for distribution companies.
Responding to reports that the regulatory body is soft on Discos for infractions and inefficiencies particularly in metering, Amadi agreed, but however noted that the agency is not quick was wield the big stick to build investors confidence in the sector, and due to the fact that the Discos are still experiencing several challenges.
“It is in the interest of consumers that we help Discos and generating companies to survive, but from the beginning of this year, we have been penalising. Recently, we asked Abuja Disco to pay N18 million to the family of a child who was electrocuted, and they did that,” he said.
Amadi added that Abuja Disco was also mandated to compensate 32,000 consumers with about N50 million due to over-billing. He explained further that the Discos are experiencing several challenges.
“You talk about tariff, but what about gas? The telecommunications industry has the advantage of technological innovations. Electricity is a conservative technology, we cannot do without gas, even if we build solar everywhere,” he said, adding that the discos have to deal with weak infrastructure.
Hon. Igariwey Enwo however challenged that NERC being soft on Discos had resulted in them not being keen on metering, and campaigning for the switch to smart meters.
“No individual from in my state, Ebonyi, has a single pre-paid meter. Many people there have never even seen what it looks like…you have to make it mandatory for them to go ahead with the metering,” he said,
The atmosphere at the hearing was less contentious than it was last Tuesday, where the lawmakers grilled Amadi on the emoluments and severance benefits accruing to him and seven commissioners when their tenures end this year.
Amadi noted that he has included the cumulative amount in fresh documents submitted to the committee as requested.
The lawmakers raised several challenges which consumers continue to experience, such as mass disconnection, paying for transformers, cables and even labour to get electricity and exploitation through estimated billing.
Also speaking at the public hearing, the Managing Director/Chief Executive Officer of the Transmission Company of Nigeria (TCN), Mr. Mark Karst said the company is targeting 20,000 megawatts of electricity by the year 2020 and would need $1 billion annually to achieve the target.
Karst noted that the money required is a huge sum.
“We have a long term expansion plan that is detailed to build 20,000mw evacuation capacity by 2020, and the funding would be by external institutions,” he said.
The TCN is however having difficulty is attracting funding, and is considering Public Private Partnership (PPP) alternatives.
“It will need $1billion annually over that period of time. It is a substantial amount of money. But this is a generation on the move, so the only choice we have would be to see how we raise the money,” he added.
Karst put the current power generation at 4,800 megawatts, with potential for 5,400 and 6,000 in a very short time if certain adjustments are made.
He disclosed that the tariff application of TCN with NERC has been pending since the middle of 2014.
“Transitional electricity market declared in February 2015 has not been effective,” he said adding that the power sector remains a difficult field to navigate for all players involved.
The Chairman of the House Committee on Power, Hon. Daniel Asuquo, said the committee takes the issue of local content seriously, and Nigerians must be given right of first refusal.
He also lamented that the TCN wholly owned by the government, is being owed by the discos despite the N213 billion loan granted to them by the Central Bank of Nigeria.
“TCN is yet to receive a dime, but the discos are paying to their banks, because government is the father Christmas,” he said.