Oscarline Onwuemenyi 17 August 2016, Sweetcrude, Abuja – Nigeria’s largest electricity companies say they are struggling to repair their networks because imports of spare parts had become too expensive due to naira devaluation.
The companies, which bought over the assets of the Power Holding Company of Nigeria, PHCN, in 2013 when the Federal Government began the privatisation of the then national power monopoly, said that with the devaluation of the naira, repairs of equipment had become almost impossible.
“In 2013, exchange rate was 150 naira per dollar. Today it is 310. How can we repair, equip, acquire new turbines at this rate of 310 naira per dollar and yet still operate with an old tariff?,” the companies said as they hinted of an imminent shut down in power supplies.
The naira has lost 40 percent of its value since Nigeria ditched its 16-month-old peg of 197 naira to the dollar in June in a bid to lure back foreign investors who fled both the equities and bond markets after the plunge in crude prices.
Added to this, lack of gas supply due to vandalism of pipeline by Niger Delta militants has seen power generating plants lying idle.
Specifically, the power generating companies said they had about 5,000 megawatts of spare capacity which has no access to gas.