By Obinna Agommuo- Executor Director, Economic Strategic Growth And Development Initiative of Africa (ESGADIA)
The Power sector of Nigeria is under siege and as such can not serve the primary function of catalyzing Nigerian economic growth as it’s obtainable in other sane climes.
Every serious Nation builds its Power in line with its population size and growth.
While Countries such as South Africa with a population of 58 million people is generating 45,000 megawatts of power, Turkey with a Population of 80 million people generates 56,000 megawatts, Iran with a population of about 80 million people, generates 83,000 megawatts of power, Nigeria with a population of 180 million people is shamelessly boasting of generating maximum of 7000 megawatts of power. It is unacceptable.
It is worthy of note that the World Bank recommends that countries generate minimum of 1 kilowatt-hour of Electricity per capita. What this means is Nigeria with a population of 180 million people ought to be generating minimum of 180 million kilowatts-hour (180,000 megawatts-hour) of Electricity.
Countries like the USA with a population of about 325 million people is generating 1. 1 million megawatts of power. This means that USA is generating above the recommended minimum 1kwh Electricity per capita. USA is currently on about 3.5 kilowatts-hour of Electricity per capita. Nigeria is on 0.037 kilowatts-hour of Electricity per capita.
What then are the challenges facing the Power sector in Nigeria, why are the real private investors in the power sector running away from Nigeria despite the availability of all the sources for Power generation in the country and despite the market for power generated? The reasons those in the Power sector of Nigeria are not able to deliver sustainable power as though they have run short of ideas are not far fetched.
The current structure of the Power sector is foully and as such no amount of effort to deliver power to the people will yield any success unless the sector is restructured.
What then is the solution?
*1. *Bundle Back the Power Sector*:
The unbundling of the power sector was an error that should be reversed as its now clear that those who bought the rights to distribute power (DISCOs) and the Generation companies (GENCOs) do not have the capacity to meet their statutory obligations as enshrined in the Agreements they entered with the Federal Government. Why would a Nation zone its distribution into its geopolitical zones and sell the rights for distribution off to companies that do not have the capacity to even distribute the laughable 3000 – 7000 Megawatts of Power which is currently generated by the GENCOs. They don’t have the funds to procure Transformers, Line Materials and Prepayment Meters to give to their subscribers.
The GENCOs are not building new plants to generate more Electricity but even if they do, who will distribute for them since they only reserve the right to generate electricity only and the DISCOs are incapacitated and inefficient in meeting their statutory obligations.
No Private Investor would want to invest in the power sector of a country where two of the sub sectors are under siege; the distribution is parcel out and sold to individuals who do not have capacity to distribute even the 3000 to 7000 Megawatts currently generated let alone when a GENCO decides to generate 100,000 megawatts, the Transmission is held by the Federal Government under the excuse of “security” and managed by Nigerian civil servants who are known for running public corporations to halt.
*2. Federal Government Must Give Up Transmission *
The Transmission company of Nigeria can’t be effectively managed by the Federal Government of Nigeria as corruption would not allow that sub-sector to strive. Let us not lose sight of the fact that Government is not a good manager of corporations due to bureaucratic bottlenecks created by civil servants who would only care about their parochial interests other than serve the interest of the public.
_We cannot sell the Goat and still hold on to the rope (ladda)._ We can’t sell the Generation, Distribution and still hold on to the Transmission. Our holding on to the transmission is a major setback in the administration of Power in Nigeria. Some of the old Transmitters in the substations that ought to be replaced are what TCN is still using today to transmit Electricity to DISCOs resulting to epileptic supply of electricity across the Nation. More new substations should be build and the old ones replaced. This can only be best handled by the Private Investors in Power not the Nigerian civil servants whose maintenance culture is unprecedentedly poor.
3. *Finally, Liberalize the Power Sector*:
After we bundle back the sector, relinquish the transmission, next is to liberalize the sector to allow real global investors in the Power sector to take the center stage to deliver the much needed Electricity, to power the active population of the our Nation Nigeria.
Let it be known that no real investor in Power that doesn’t have the capacity to generate, transmit and distribute power to its subscribers. Let Government through the Nigerian Electricity Regulatory Commission (NERC) regulates the power sector only and not partake in Electricity transmission. Transmission of Power in Nigeria should be left in the hands of the Private Investor. Why are we playing politics with the future of this great Nation, Nigeria for God sake?
Nigerian Economy will no doubt hit the rocks in no distant future as less attention is being given to Crude oil in the world today. Developed economies are investing their money to research and develop alternative energies to drive their future economies, while Nigeria is wasting her scarce resources in search of hydrocarbons in the Chad basin. The Government of Nigeria seems not be in touch with the age and time to know that all over the world including Africa, effort is being made to stop the usage of Fossil fuel and consequently halt the purchase of Crude Oil in say 30 years time. What effort is Nigeria making to drift from over reliance on Crude Oil? If Nigeria keep lying to herself and keep playing politics with the Power sector, Nigeria shall become the poorest Nation on earth before the year 2050. We are still surviving as a Nation because there’s still demand for Crude oil. Nigeria should wake up from their deep slumber and smell the coffee. Nigeria should give power to her active population to grow her GDP, to grow her economy.