Why World Bank backs Osinbajo-led power reforms with $750m

The World Bank Board has approved a $750 million facility for the Nigerian Power Sector in a bid to support the Buhari administration in providing constant power supply to Nigerians. The facility under the Bank’s The Power Sector Recovery Programme (PSRP) buys time in favour of the Nigerian consumers as it forestalls the increase of tariffs especially for the lowest rungs of the

Read more

Electricity Reforms: A Bumpy Road To Privatising Nigeria’s Power Utilities

 

GOING by government’s time schedule, the Nigeria Power Sector Reform Roadmap is set to enter the next crucial phase — the Transitional Electricity Market (TEM) stage — for the commencement of a fully contracted electricity market mode under an anticipated robust commercial and technical regime.

   It was celebration in government circles Wednesday night as it recorded substantial compliance in payments by Preferred Bidders for the sale of unbundled companies of the Power Holding Company of Nigeria PHCN, under its globally acclaimed power privatization programme.

   By the close of transactions Wednesday night, all Preferred Bidders had paid up, except the Enugu Distribution Company, while the preferred bidder for Sapele Power Station had made substantial part-payment.

 The completion payment now entitles the preferred bidders to take full possession of the 15 PHCN unbundled entities (10 Distribution companies and 5 Generation companies).

 

Read more...

 

 

Power Reform: Big Project… Tough Debate

 

We Are Paying Off Electricity Workers Already — Govt

IT would seem that government, on behalf of many Nigerians, including the investors who believe in the current privatisation efforts, are winning the battle, pushing past “age-long” hurdles in an ambitious countdown to the sale of the power plants.

Power assets that have been successfully sold by the BPE include 10 distribution companies (Ikeja, Eko, Enugu, Port Harcourt, Ibadan, Yola, Jos, Abuja, Benin and Kano) and five power generation companies (Shiroro hydro plant, Ughelli Thermal Plant, Sapele Power Plant, Kainji Hydro Plant and Geregu Power Plant). The Afam Generating Plant and the Kaduna Distribution Company are yet to be sold.

At least, $2.6 billion (about N408 billion, going by conservative estimates), according to the Bureau of Public Enterprises (BPE), will hit the national coffers by the time the exercise is successfully concluded; that will amount to some N408 billion going by conservative estimates.

   

 Read more...

Power Reforms: Will Payment Of Severance Package To PHCN Workers Clear The Coast?

 

THE report in the week that the Federal Government has ordered the immediate release of severance pay to the members of staff of the Power Holding Company of Nigeria (PHCN) who are to be disengaged to enable new owners take over the country’s electricity plants was cheering. The news was not only encouraging to the PHCN workers alone who would be smiling home with lump sums to start a new life but also to millions of Nigerians who grope in darkness due to poor electricity supply but pay high tariff in return as a result of PHCN’s poor and dubious billing system that leaves them wishing that the privatisation of the power sector becomes successfully completed in no time.

The Minister of Power, Prof. Chinedu Nebo, had at the Federal Ministry of Power-Siemens Power Development Forum last Tuesday in Abuja disclosed that he had approved the payment of the workers to start immediately and expressed hope that the workers would get paid before the end of the week. The following day (Wednesday), the Ministry of Power issued another statement to that effect saying: “The Minister has directed the commencement of the payment of severance package to PHCN staff, on which about N384 billion is going to be expended with additional N16 billion to pay other retirees and pensioners of the company. 

Read more...

 

Power Sector Reforms: Taking a Cue from Telecoms Sector

 

Prof Chinedu Nebo, Power Minister

S.A. Bello

It is an undisputable fact that Nigeria witnessed a telecom revolution during the decade that started with the ushering in of the third democratic dispensation in 1999 up to 2010. Tele-density rose from 0.6 per cent to about 60 per cent within a decade. Can the same feat be repeated in the power sector? During a recent event in Lagos, the Minister for Power, Prof. Nebo was quoted as saying that the revolution that took place in the telecom sector will soon take place in the power sector. That is a good vision and a big ambition. I admire people like Prof. Nebo who are pessimistic and who believe in the power of positive thinking. However for this to happen, the political will, policy focus and the regulatory environment that gave birth to and nurtured the telecom revolution must be replicated in the power sector.

 

Read more...

Power reform: How far can Nebo go?

 

By Obas Esiedesa/Abuja

Two weeks ago, power generation fell below 2500 megawatts (MW) for the first time in three years due mainly to vandalism of two major pipelines supplying gas to eight power generation stations in the country, namely Egbin/AES Thermal Stations, Olorunsogo, Omotoso, Geregu NIPP, Afam IV and VI Thermal Power stations as well as River State Independent Power Plant.

With the disruption of gas supply through the lines, the Nigerian Gas Company (NGC) was unable to pump gas to Afam IV, Afam VI as well as the Independent Power Plant in Rivers State, resulting in the loss of 593MW. Also, the second vandalised gas pipeline from Escravos to Warri caused a further cutback of 1,005MW in power generation from Egbin/AES power generating station, Olorunsogo, Omotosho and Geregu NIPP power plants.

Following these incidents and the constant system collapses recorded in the transmission network, Minister of Power, Professor Chinedu Nebo, admitted that government was facing serious difficulty in its effort to fix the nation’s power sector.

According to him, the situation in the power sector is getting out of hand and he called for the support of Nigerians in checking vandalism of facilities being put in place by the government.

He said: “It is interesting to note that some of the causes of system collapses could be corrected by very simple work that could be done seemingly effortlessly. I will like to plead with the generality of our people to understand that we are facing very difficult times in the power sector. Some of these problems are man-made, some have accrued from years of under-funding and under-development of the sector.

 

Read more...

President of Nigeria Society of Engineers Optimistic About Power Reforms

 

The President, Nigeria Society of Engineers, Otis Anyaeji has said that with the increasing activities of the National Integrated Power Project (NIPP), the erratic power supply in the country will soon be a thing of the past.

Speaking as a guest on Channels Television’s breakfast programme, Sunrise Daily, Mr Anyaeji said the government had already entered into an agreement that will ensure that gas, a major ingredient in power generation, is on constant supply to power plants.

He said the reason for his optimism over the reforms is the change in the behaviour of both the government and contractors handling power projects

 

Read more...

Power sector reform to boost Nigeria’s growth, says IMF

 

Implementation of the power sector reform and rebound from floods would boost Nigeria’s growth this year, the International Monetary Fund (IMF) has said.

The Fund, which said this in the latest edition of its World Economic Outlook (WEO), also projected a Gross Domestic Product (GDP) growth of 6.7 per cent and 6.9 per cent for the country in 2013 and 2014.

Nigeria’s GDP is projected to be seven per cent this year. The country had recorded a GDP growth of 10.3 per cent, 10.6 per cent, 5.4 per cent, 6.2 per cent, 7 per cent, six per cent, 7 per cent, 7.4 per cent, 7.4 per cent and 6.5 per cent in 2003, 2004, 2005, 2006, 2007, 2008, 2009, 2010, 2011 and 2012.

Historically, from 2005 until 2012, Nigeria’s GDP growth rate averaged 6.8 per cent reaching an all-time high of 8.6 per cent in December of 2010 and a record low of 4.5 per cent in March of 2009. The GDP growth rate provides an aggregated measure of changes in value of the goods and services produced by an economy.

About $2.23 billion revenue is expected by the Federal Government from the sale of the 15 Power Holding Company of Nigeria (PHCN) assets. The funds are expected to be pumped into major infrastructure in the country, including the power sector. Once the power issue is resolved, more economic activities will spring up and this will translate to an increase in the county’s GDP.

 

Read more on the nation newspaper

Power sector reform: Re-appraising FG’s privatisation process

 

The Minister of Power, Prof. Chinedu Nebo recently re-echoed the stand of the Federal Government on the privatisation of the power sector, saying that there was no going back on the plan and has called on genuine investors to take advantage of the coming revolution in the sector; Etuka Sunday chronicles the journey so far.

The substantial increase in the quantum of power delivery to Nigerians nationwide in recent times has proven the fact that things could still be done rightly in Nigeria. Every Nigerian, if not for anything, must have experienced the significant progress made so far in the area of improved power supply since the launch of power Road Map in August 2010 by President Goodluck Jonathan.

The Road Map was anchored on three fundamental facts: “Removing obstacles to private sector investment to ensure accelerated development of the Nigeria’s electricity market; improving service delivery throughout the transmission period to ensure that average Nigerian begins to feel the impact of the reform and divestiture of the PHCN successor companies and reforming the fuel-mix to power sector”.

 

Read more on peoplesdaily.com

Power reforms: Experts want FG to uphold agreements

The Federal Government’s failure to uphold strategic agreements has been described as a major setback to the speedy actualisation of the reforms and ongoing privatisation process in the nation’s power sector.

To this end, industry professionals, who spoke with our correspondent in separate interviews, observed that unless the government learnt to abide by agreed terms reached with stakeholders in the sector, the country might continue to suffer poor electricity supply.

The former Minister of Power, Prof. Bart Nnaji; a former Chief Executive Officer, Transmission Company of Nigeria, Mr. Akin Bada; and a senior executive member of TCN bemoaned the level of disagreements that had characterised the reform process.

Though the government is making frantic efforts to resolve the labour issues and the controversy surrounding the handing over of delegated authority to Canadian firm, Manitoba Hydro International, to manage TCN, industry experts declared that more should be done with respect to the upholding of agreements reached with private sector players.

Describing this as a challenge to investors, Nnaji explained that huge sums had been invested in the country’s electricity space since the commencement of the reforms.

 

Read more on punch newspaper

Nigeria power reform faces further setback

 

There seem to be no end in sight to the barrage of roadblocks against the Federal Government’s power sector reform initiative, investigations by our correspondent has revealed.

On one hand is the disagreement between the government and workers of the Power Holding Company of Nigeria as regards the payment of severance benefits, which took a new dimension on Tuesday.

 

Read more...

Fresh hurdles threaten power sector reform

 

There appears to be no end in sight to the roadblocks on the path of the Federal Government’s power sector reform initiative, investigations by our correspondent have revealed.

On one hand is the disagreement between the government and workers of the Power Holding Company of Nigeria as regards the payment of severance benefits, which took a new twist on Tuesday.

On the other hand is the issue of too many interests in the sector, which has led to the duplication of duties in the industry.

These, according to top sources at the Ministry of Power, may create further challenges to the smooth running of the sector.

A top official in the ministry said the Minister of Power, Prof. Chinedu Nebo, was working hard to address the challenges in the sector, but stressed that agitations by the labour unions and concerns raised by some interested parties in the sector might increase the bottlenecks hampering the smooth transformation of the sector.

 

Read more...

FG denies policy reversal in power sector

Chairman of the Presidential Task Force on Power (PTFP), Engr. Dagogo-Jack has denied that the federal government was embarking on policy reversal by the review of the 2010 power sector roadmap.

Recently, the PTFP hosted a stakeholders’ forum on the 2010 power road map with a view to updating it to be in tune with current reality. However, the action drew flanks from the media suggesting that it amounted to policy somersault, arguing that nothing substantial had been achieved since its launch in 2010 and so there’s no reason for review.

Former minister of Power, Prof Barth Nnaji was the chairman of the PTFP when the 2010 roadmap was launched.

Speaking at the task force’s fifth board meeting in Abuja last week, Engr. Beks Dagogo-Jack said “for anyone to describe such a technically sound and judicious initiative as tantamount to policy reversal or somersault, is not only mischievous, but a calculated attempt to denigrate the offices and persons of those of us working so tirelessly to overcome where several have failed in the past. Nigerians should please exercise restraint and resist the urge to cheaply politicise developments in a sector as basic and ...

 

Read more...

How to tackle post-power reforms challenges, by stakeholders

 

CONCERNED stakeholders have clamoured for well synchronised policies that would encourage optimal utilisation of both natural and human capital resources inherent in the country after the emerging power reforms. They said this was necessary in order to sustain the efficency expected to come with the reforms.

Besides, the experts noted that the country’s installed power capacity of 8,000MW and generating capacity of between 3,500MW – 4,000MW for population of 164 million was still inadequate. They thereforeinsisted that the nation could only meet the national demand for electricity, if generation is increased to about 75,000Mega Watts (MW).

The engineers who spoke at the Electrical and Electronics Engineer Yearly Lecture organised by the Nigerian Institution of Electrical and Electronics Engineers in Yenogoa, Bayelsa State, also believed that diversification of sources of power generation, dearth of skilled manpower and use of technology are areas that should be given serious attention, if the problems of the power sector should get sustainable solution.

 

Read more...

FG to begin inspection of power projects

 

 

… Only 40 of 491 projects completed
The Federal Government is to begin an inspection of all power projects site across the country from this March, warning that it might sanction contractors found to be delaying in the delivery of projects.

This follows the poor execution and delivery rates of power projects by contractors, as only about 40 out of 491 contracts so far awarded had been completed.

To this end, Vice President Namadi Sambo, said he will send out a crack team of project monitoring group by from this month, to ascertain the level of work at the sites and to take far-reaching decisions if necessary,

 

Read more...

Sustaining the modest gains of power reform

 

By Pini Jason
RECENTLY President Goodluck Jonathan told CNN’s British-Iranian anchor Christine Amampour that the power sector has witnessed a “tremendous improvement”. Many Nigerians scoffed at that.

They compared Nigeria’s current peak of 4517 megawatts as at 21 December 2012 with a country like South Africa with over 40,000 megawatts and dismissed Jonathan’s assessment as rather hubristic.

I think coming from where we were a few years ago when we had less than 2000 megawatts and considering the investment in infrastructure as well as the progress made in the reform road map launched in August 2010, Jonathan had reasons to sound upbeat.

And those who look at where we ought to be and the challenges ahead also have reasons to have a dim view of our achievement. It is natural for the public, in such matters, to focus on the destination and not acknowledge the distance so far traversed and the challenges facing the rest of the journey.

 

Read more...

 

 

Why FG Must Stick to Timelines for Power Assets Sale

 

Vice President Namadi Sambo

By Shaka Momodu

The ongoing power privatisation programme finally reached a significant milestone last Thursday with the National Council on Privatisation (NCP) approving the sale of 70 per cent of Egbin Power Plant to KEPCO, alongside other transactions in the power sector, after a rigorous and daunting exercise, which was adjudged as fair and transparent.

It is becoming a well-understood fact that economic growth in Nigeria can only be achieved with reliable electricity supply. However, achieving this goal is definitely easier said than done as the last three civilian governments can attest. Fixing the electricity supply industry in the country meant reversing decades of rot, corruption, mismanagement and underfunding that have plagued the government controlled industry, a task most administrations lacked the political will to enforce.

Former President Olusegun Obasanjo’s administration took a drastic solution by liberalising and selling off all the generation and distribution assets owned by the government. After all, this strategy had worked fantastically well in the telecommunications industry.

In 1998, the now defunct Nigerian Telecommunications Limited (NITEL) had less than 100,000 mobile phone lines in operation, but today, 14 years later, the number has exploded to about 115 million mobile subscribers. It was hoped that the success in the telecommunications sector could be replicated in the power sector.

 

Read more...

Nigeria’s electricity problems can’t be resolved in 5 years – PTFP boss

 

The Chairman of the Presidential Task Force on Power (PTFP), Engr. Beks Dagogo-Jack has urged Nigerians to be patient with the pace of the power sector reforms, noting that due to complexity of the situation, it cannot be resolved even in the next five years.

Dagogo-Jack, who was speaking at the fifth Board meeting of the Presidential Task Force on Power held last week, justified the launch of the Power sector Reform Roadmap 2.0, stressing that the need for effective transition in the sector made a review of the original document imperative.

He stated that, “The road to power adequacy in Nigeria has been a tortuous journey, given the history of past failures and obstacles that continues to exist in the sector up to date. It can not and will not be fully resolved in just 2, 3 or even 5 years.

He added that, “However, it is not an insurmountable challenge and remains very attainable. Roadmap 2.0 is the sector managers’ due diligence initiative to ensure the continued integrity of our planning projections and to bring the revised version into better alignment with emerging realities as we set the stage for the transition of the electricity industry to full market mode.”

 

Read more....

Why Power Sector Roadmap Is Being Reviewed – Dagogo-Jack

 

The Chairman of the Presidential Task Force on Power (PTFP) Mr Beks Dagogo-Jack has said that the power sector roadmap review exercise was a fundamental technical requirement any reform driving agency must embark on especially towards the final stages of the reform process.

He restated that the 2010 version remained the anchor upon which achievement so far in the reform has rested, adding that a reform roadmap was more of a sector development strategy and project delivery tool structured as a rolling plan rather than a mere political or campaign document that can be tinkered with.

Making the clarifications at the fifth Board meeting of the PTFP, Dagogo-Jack, explained that it was imperative for the key outstanding targets in the roadmap to be current and better aligned with emerging realities as the stage was set for the transition of the electricity industry to full market mode.

“In the revision process, achieved milestones are rolled off, slipped milestones are reset, and even brand new milestones not previously captured are rolled on,” he added.

 

Read more...

Presidency explains review of power roadmap

 

 

 

• Says consumers partly responsible for outage

AS the Federal Government continues to falter in matters concerning increased power generation and supply, as well as privatisation of the sector, the Presidential Task Force on Power (PTFP) has provided further insights into the reason it was reviewing the Power Sector Roadmap developed in 2010, noting that the move was not “policy somersault.”

The government also assured Nigerians once again that the President Goodluck Jonathan-led administration would surmount “all the daunting obstacles, which had overwhelmed several past governments and shall, by God’s grace, take Nigerians to the Promised Land,” according to a statement issued Sunday after the fifth board meeting of Task Force on Power.

“Let’s face it, with our population of over 160 million people living in over 25 million households, the current available peak power of 4500MW is just a tiny drop in the ocean. This is why we are having the blackouts,” Chairman of PTFP, Beks Dagogo-Jack, said.

“The load shedding, which was increasing lately, has its origins in the fact that once consumers witnessed increasing supply and reliability, previously suppressed or migrated demand started returning to the grid.

 

Read more...