31 May 2016, Abuja – The power sector in the first year of Muhammadu Buhari’s presidency was stunted by sundry challenges, even as the authorities continued to set unrealistic targets, writes Chineme Okafor
Electricity has become a part of modern life and one cannot think of a world without it. Access to affordable electricity is an enormous challenge facing households and businesses in Nigeria. According to the Nigeria Economic Summit Group (NESG), about 41% of firms in Nigeria generate own power. Also, the Manufacturers Association of Nigeria (MAN) disclosed recently that about 61 per cent of Nigerians own power generating sets due to the lack of access to electricity.
Power generation has remained abysmally low at around 3,000 megawatts for decades and the situation has become messier despite the power sector privatisation and the huge amount of money invested in the National Integrated Power Projects (NIPPs), which currently contribute a paltry amount of electricity into the national grid.
In the last one of year of President Muhammadu Buhari in office, generation often dropped below 2,000 megawatts owing to vandalism of gas pipelines and other equipment.
Many however believe that the president’s failure to take critical decisions that could have progressed the policies on ground, contributed to the setback in the power sector in the last one year.
During his inauguration, Buhari had expressed worry about how bad things were in the nation’s power systems and had pledged his determination to work differently to leverage on existing good policies.
The president had said: “At home, we face enormous challenges. Insecurity, pervasive corruption, the hitherto unending and seemingly impossible fuel and power shortages are the immediate concerns. We are going to tackle them head on.
“Nigerians will not regret that they have entrusted national responsibility to us. We must not succumb to hopelessness and defeatism. We can fix our problems,” he added when he accepted to chaperon Nigeria’s reported national revival.
He also described as a “national shame” a situation where Nigeria struggled to generate and distribute just 4,000 megawatts (MW) of electricity.
But one year after, the improvements he pledged to pursue are still feeble while power supply across nooks and crannies of Nigeria has become worse.
As at today, Nigeria generates just about the same quantity or even less of what Buhari met on ground – the country on the average manages between 2800MW and 3500MW, and without a single unit of spinning reserve as at the last check.
It was under his watch that power generation rose to an all-time 5,074MW on February 2, 2016 as reported by the Transmission Company of Nigeria (TCN), but also dipped to another record low of zero megawatts on March 31, between the hours of 12.35pm and 3pm when Nigeria had no single unit of electricity on the grid to supply to her industries, homes and offices.
Few weeks after Buhari assumed office, power supply across the country witnessed some improvements.
But subsequently, shortages and blackouts became so routine and frustrating as his government failed to quickly address issues of gas supply to power station and inadequate transmission facilities owing to uncompleted transmission projects.
If any at all, the policy approach adopted by the president in managing Nigeria’s power sector since he took over has largely contributed to systemic lull in the business of power generation, transmission and distribution in the country.
And even though his minister in charge of power, Mr. Babatunde Fashola recently voiced out the government’s adoption of “incremental, stable and interrupted” power as the new policy it will adopt to generate 10,000MW in 2019, nothing new came to the power sector in Buhari’s one year in office.
Generation stations (Gencos) still lacked fuel (gas) to switch on and stay on; distribution companies still contended with legacy challenges of poor distribution infrastructure, poor revenue collection and high technical losses; and the TCN still have projects that need to be completed but it cannot for sundry reasons the government has immense capacities to resolve.
As Buhari marks his one year in office, analysts have rated his management of Nigeria’s electricity so far as either poor or non-committal.
Also, his minister, Fashola appeared to be interested in providing excuses that the government was still studying the situation of policies and projects it met on ground. According to him, his frequent meetings with stakeholders in the sector was to get everyone on the same page.
Experts have however attributed the government’s dithering in the sector to maybe its poor grasp or evaluation of how the country’s electricity sector has evolved in the last few years from a government controlled sector to now a market driven sector.
They also said the president squandered almost six months of his first year without a minister to guide events in the power sector, which was still in transition.
For them, the president had in his one year in office remained a lot silent on how he planned to advance policies that could lead to more and stable power supply in the country.
Other than specific challenges of poor generation from frequent dip in gas supply to Gencos and other related distribution and transmission challenges, Buhari also remained largely unsuccessful in guaranteeing regulatory stability in the sector as well as certainty in further investment.
Constituting a board for the sector’s regulator, the Nigerian Electricity Regulatory Commission (NERC) since the tenure of the last board of commissioners expired in December 2015 has remained unattended to by the government.
Irrespective of contrary views that the NERC could still function well without a constituted board of commissioners, the electricity Act on which Nigeria runs its power industry stipulated that a board of commissioners be put in place at all times to safeguard and strengthen regulations in the sector.
Nigeria, according to experts have signed up to operate a globally recognised market-oriented electricity sector of which proactive regulation is one of its features, holding back the constitution of a proper fit-for-purpose regulator has its negative impacts on the confidence of operators in the sector.
The NIPP was conceived as an intervention to the country’s poor power situation. It still has outstanding projects within its first phase schedule to complete.
Notwithstanding the challenges, the government has within its one year in office shown commendable leadership in an aspect of the country’s power sector, which at a point threatened its commitment and respect for contracts in the power market.
It was the resolution of a disagreement in a ‘ring-fenced’ power supply contract it signed with Geometric Aba Power and which was contested by owners of the Enugu Disco – Interstate Electrics.
For a very long time, the agreement, which granted Geometric the priority right to generate and distribute power to the Aba and Ariaria business districts within the Enugu distribution network was contested by Interstates, and the government which signed the agreement with Geometric failed to come clean on the sanctity of the agreement it signed with Geometric.
This unwholesome act placed government’s commitment to contract sanctity in the power sector in question, but it was however resolved after Vice President Yemi Osibanjo brought parties to the disagreement to agree on favourable terms, suggesting that Geometrics can now go on with its investments and improvement of power supply particularly to the eastern part of the country.