Power sector may collapse from poor investment – ANED

Oscarline Onwuemenyi 25 May 2016, Sweetcrude, Lagos – The Association of Nigerian Electricity Distributors, ANED, has listed the impediments to investment in the power sector and warned that the sector could collapse if urgent steps are not taken to remedy the situation.

*Electricity transmission.

*Electricity transmission.

Executive Director of Research and Advocacy, ANED, Mr. Sunday Oduntan, who briefed the media on the challenges facing the industry, said the industry revenue shortfall is massive and growing to the tune of N300 billion.

Oduntan said, “This is a cash liquidity crises that threatens to completely undermine the electricity value chain and its ability to continue to serve its customers.

“The revenue shortfalls adversely impact the ability of the distribution companies (Discos) to make capital investments in metering, network expansion, equipment rehabilitation and replacement that are critical for service delivery improvement.”

He said that new investors in the distribution sub-sector of the industry have made a significant improvement in many areas like metering the consumers and internal restructuring.

According to him, 3,283,402 million customers are now metered, bringing the metering gap down to 2.8 million while efforts have been made to carry out internal restructuring and streamlining of operational costs to make the Discos run more efficiently.

He further said that the sector has made improved meter roll out strategies at the customer level and the interface/trading points, adding, “we are getting better at accounting for the energy we receive which will lead to (more) reasonable estimated bills.”

Oduntan stated that in order to sustain the industry, the government should honour the terms of privatisation, generate more electricity and remain consistent in regulation making which is fundamental to the commercial viability of the sector.

He also noted the lack of access to foreign exchange and the need for partnership among key players to resolve all issues in the sector.

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