14 January 2016, Lagos – The imbalance in the foreign exchange regime, occasioned by the falling rate of naira, is taking its toll on the operations of new power investors, the Chairman, Egbin Power Plc, Mr. Kola Adesina, has said.
He said the power distribution companies (DisCos) are spending more money than before to buy equipment abroad, because the naira is falling at abysmal rate.
While speaking at a stakeholders’ meeting in Lagos, Adesina said the problem facing the naira has made it difficult for power firms to survive, since they depend on Original Equipment Manufacturers(OEMs) in their production.
He said: “When we bought Egbin Power Company when the sector was privatised in 2013, naira was sold for N159 per dollar. At a point, the value of naira reduced further as it was sold for N179 to a dollar, and later N196 to a dollar at the official window. The situation was worse at the black market where dollar is sold for N220 and above. This is not without its attendant consequence on operators in the sector.’’
According to him, spare parts used in the industry can only be procured in dollars, stressing that the development is having far-reaching effects on the performance of the operators.
Adesina said despite the fiscal problem, among others, facing the sector, and the economy, Egbin Power has weathered the storm to record some successes.
He said the achievements included increased megawatts (Mw) of electricity, thereby making the turbines functional, among others.
Adesina said the recent one was the dedication of 220 megawatts of electricity to Lagos, by Egbin. He said this would not have been possible without the support of the Vice President Yemi Osinbajo.
“When we choose to dedicate the 220 megawatts to Lagos, the Vice President, Osinbajo stood by us,” he added.
- The Nation