×

Canadian firm gets $24 million contract to fix Nigeria electricity problems

The Bureau of Public Enterprises on Wednesday said Manitoba Hydro of Canada (MHC) had won a $24 million power transmission contract, part of delayed plans … Continue reading Canadian firm gets $24 million contract to fix Nigeria electricity problems


The Bureau of Public Enterprises said Manitoba Hydro of Canada would be responsible for reducing electricity losses during transmission, ensuring adequate generation output and regulating fair payments between traders.

The Bureau of Public Enterprises on Wednesday said Manitoba Hydro of Canada (MHC) had won a $24 million power transmission contract, part of delayed plans to overhaul the woeful electricity infrastructure in Nigeria.

The Bureau of Public Enterprises said Manitoba Hydro of Canada would be responsible for reducing electricity losses during transmission, ensuring adequate generation output and regulating fair payments between traders.

Nigerian President, Goodluck Jonathan announced plans to reform the power sector 20 months ago but privatisation has been slow due to political wrangling, union disputes and government concerns over raising electricity prices.

Nigeria is blighted by persistent electricity outages which force businesses and individuals who can afford them to rely on diesel generators.

It also perpetuates social inequality in a country where the majority survive on $2 a day or less, depriving many of light at night or the ability to power water pumps, let alone recharge mobile phones or access the Internet.

MHC has won the contract to manage the Transmission Company of Nigeria (TCN), responsible for transmitting electricity from power plants to substations. It is negotiating the contract price – it wants $24 million – before signing.

The Bureau of Public Enterprises said in a statement on Wednesday MHC would be responsible for reducing electricity losses during transmission, ensuring adequate generation output and regulating fair payments between traders.

The Federal government plans to privatise the bulk of six power generation plants and 11 distribution firms, which supply end users, but it has yet to clarify a new tariff structure due to fears of a public backlash against higher prices.

Companies won’t buy state assets until a tariff system guarantees competitive electricity prices. Given that most people currently only receive sporadic power it will be a universally unpopular step, although necessary for the long term future of power output.

The power ministry is also in negotiations with unions representing employees of the Power Holding Company of Nigeria, the inefficient giant which currently manages power distribution. Privatisation will lead to job losses.

Tens of thousands of Nigerians took to the streets in January after the government removed fuel subsidies, more than doubling the cost of motor fuel.

More than a week of protests and strikes forced the government to partially reinstate the subsidies.

Video