A Review of the Nigerian Energy Industry

PSRP implementation to deliver 4,500MW of power daily from 2018 – Report

*Electricity distribution panels

Oscarline Onwuemenyi

09 February 2018, Sweetcrude, Abuja – The Federal Government has announced that the implementation of the Power Sector Recovery Programme (PSRP) will deliver a minimum of 4,500 mega watts (MW) daily power supply from 2018.

A document obtained from the Ministry of Power, Works and Housing explained that the PSRP has been the vehicle of change, right from the privatization of the power sector till date.

It noted that several policies embedded in the reform program meant to be carried out by the National Electricity Regulatory Commission (NERC), Generation Companies (Gencos), Distribution Companies (Discos), Transmission Company of Nigeria (TCN), Nigeria Bulk Electricity Trader (NBET), Nigeria Electricity Management Services Agency (NEMSA) among others are geared at improving the power sector.

The Minister of Power, Works and Housing, Mr. Babatunde Fashola recently assured Nigerians of an improved 2018 as regard power supply to consumers. This assurance was made based of the proposed number of power plants that is to come on-grid this year.

The PSRP serves as a road map to the effective optimization of the Nigeria power sector is a series of policy actions, operational governance and financial interventions being implemented by Federal Government over a period of time.

The aim of this programme is to reset the Nigerian Electricity Supply Industry for future growth. The programme, among other objectives was also designed to strengthen the sector’s institutional framework and improve power supply reliability to meet growing demand of electricity consumers in the country.

The document revealed that PSRP was also meant to improve performance of the Electricity Distribution Companies (Discos) through a balance approach of incentive regulation, monitoring and enforcement to ensure aggressive reduction of technical and commercial losses. This, According to the document will be achieved through accelerated metering programme, upgrade of distribution and transmission interface networks to improve operational efficiency.

It also indicated that the PSRP would also address major issues constraining gas availability to the sector, notably pipeline vandalism and payment arrears due to gas suppliers. It said this was being archived through the provision of N701.9 billion payment assurance facility provided by government to guarantee payment of generation and gas invoices for 2017 and 2018.

It said the facility was one of the funding sources to ensure companies in the sector received their revenue requirement from 2018. The PSRP document also revealed that the World Bank had also expressed willingness to assist government with 2.5 billion dollars, adding that action plans were being taken by government to facilitate the release of the fund.

The document also highlighted strategies to restore governance structure, ensure transparency in the value chain through appointment of qualified persons and regular publication of key operational and financial information to the public.

It further indicated the financing plans to fund the historical deficit in the sector caused by tariff shortfall of N420billion from Jan. 2015 to Dec. 2016. Other components of the PSRP include strategic plans to pay the historical Ministry, Departments and Agencies (MDAs) debts and mechanism to automate future payment of electricity bills.

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