Power Sector Owners Yet To Invest For Better Performance – Barth Nnaji

Barth NnajiA former Minister of Power, Barth Nnaji, on Wednesday called on investors in Nigeria’s power sector to start investing, to improve the quality of service and deliver better power supply to the citizens as that was the reason the government sold the infrastructure to them.

According to Mr Nnaji, one of the keynote speakers at the 7th Lagos Economic Summit (EHINGBETI 2014) said the new owners “invested to purchase but they haven’t invested to improve.” He said this while appearing on Channels Television’s breakfast programme, Sunrise Daily.

Mr Nnaji mentioned that rapid investment is one key issue and the companies that purchased the distribution and generation companies must invest quickly because “that’s the whole essence of the privatization.”

He added that the privatization process would be meaningless unless those companies actually deliver on what they signed on to, which is, “they must invest to improve efficiency of collection and the network for distribution companies. Those who purchased generation companies must invest to lift the generation figures. ”

The Federal Government had assured Nigerians that the reforms made in the power sector would put an end to epileptic power supply experienced in many parts of the country but many still complain of poor service.

On this Nnaji said the performance growth in the sector should have been incremental and that the investors would need to replace a lot of dilapidated transformers, lines as well as install connection systems, prepaid meters to satisfy the demand for electricity.

He said, the time it would take citizens to feel the impact of the privatization process would vary depending on the area, noting that it would take about a year for those in Lagos to feel the changes.

He disclosed that there were generating plants in Lagos which only require gas to deliver power as quickly as possible. He mentioned that vandalism was playing a huge role on the unavailability of gas and that the infrastructure needs more investment and monitoring systems to ensure better delivery.

When asked about the possibilities of hydro power, Nnaji said “Hydro has a limit. After Mambilla and Zungaru (power plants), there’s really no other big hydro that we are working on so we have to understand that as a country.

Nnaji, who said that the success of Nigeria’s power sector would have to come from gas fired plants and coal fired plants, noted that there were large deposits of coal in Enugu, Benue, Kogi and Gombe States.

He mentioned that the large economies of the world including America and China were using coal-fired plants to generate up to 60 percent of their power despite the negative implications to the environment.

“So people can’t tell Nigeria, you should be very clean and be tree-huggers here, while they are powering their economy with coal. It’s just unacceptable. I think (in) Nigeria, we have to willfully go about this and invest in coal-fired plants.”

He defended his position on Nigeria using coal despite the implications to environmental health, stating that the coal quality in Nigeria is better that in many other countries. The coal has no sulfur and has high calorific value and so not “great pollutants” to the environment.

NECA Faults Picketing Of Power Company Workers

Olusegun-OsinowoThe umbrella body for the organised private sector, the Nigeria Employers’ Consultative Association (NECA) has faulted the picketing of Jos Electricity Distribution Company.

The Director General of NECA, Olusegun Osinowo, told reporters in Lagos on Saturday that the action of the National Union of Electricity Employees (NUEE) was a ‘wanton display of impunity in the name of industrial actions’.

The National Union of Electricity Employees (NUEE) in collaboration with the Nigerian Labour Congress (NLC) had made good its threat against electricity distribution companies across the country when its members forcefully closed the Jos section of the distribution company on March 31.

Dangerous Dimension

The union had also vowed to clamp down on the other nine distribution companies over alleged “anti-labour issues” and unpaid severance benefits.

NECA, however, described the move as “illegal and a dangerous dimension” in the ongoing reform programme in the power sector.

The Director General of NECA said the country had credible institutions and law that had been well articulated for managing whatever grievance or dispute a union or employer had.

“The way to go is not the way of impunity, picketing or strike and if this is not nipped in the bud, it might as well lead to a bigger crisis for this country giving the importance of the electricity sector to the development of Nigeria. I appeal to the Union to follow the laid down procedure for resolving disputes in Nigeria.

“Those institutions are credible and they will do justice to whatever issues the union brings to them,” the NECA head said.

He called on the union to follow the laid down procedures of resolving industrial disputes in Nigeria and also asked the Federal Ministry of Labour and Productivity and its counterpart in the Ministry of Power to set up a platform for dialogue in order to look at the issues at stake.

TCN Assures Of 10,000 Megawatts Of Electricity

The Board Chairman of the Transmission Company of Nigeria, Mr Ibrahim Waziri, has said that plans are underway for the transmission of 10,000 megawatts of electricity to Nigerians by 2017.

Speaking at a news conference in Abuja, Mr Waziri said that the T.C.N plans to achieve the feat through it’s over 160 projects spread across the country.

He also disclosed that despite the huge success recorded in ensuring adequate power supply to Nigerians, the agency still faces challenges of vandalism and theft of infrastructure.

 

 

Nigeria Commends General Electric For Funding Power Sector

The Nigerian government has commended General Electric (GE) for pumping the sum of 350 million dollars into the power sector to develop the sector and small businesses, saying the fund has made a remarkable impact in the sector.

The government also urged the company to look into the enormous opportunities in the gas sector in line with the memorandum of understanding (MoU) and partnership made with the company.

Vice President Namadi Sambo made the commendation during a meeting with the Global General Manager and Chief Executive Officer (CEO) of GE, Mr Jeff Immelt and other global partners at the state house in Abuja on Friday.

Mr Sambo said the government would organise a global conference in February 2014 on ‘Financing the Power Sector’ under the aegis of National Council on Privatisation.

The World Bank, African Development Bank, Islamic Development Bank and Export-Import Banks would be attending the conference.

He said: “Invitation has already been sent to companies in the power sector”.

The Minister of Trade and Investment, Olusegun Aganga, said the meeting with GE and other global partners was as a result of Nigeria’s programme with the GE under which a billion dollar MoU was signed more than a year ago.

The MoU, which covers assembling of turbines in the power and other sectors, also involves assembling of locomotives in the country and investment in the healthcare sector.

“The ceremony of the agreement was performed in Calabar last June and GE’s $350 million has brought development. Today, the company has started to bring in its supply chain into the country,” Aganga said.

Mr Immelt commended the Nigerian government for the support the company had received and pledged that the company would engage in several aspects of Nigeria’s economy.

“We will engage in the power sector – the National Integrated Power Project; oil and gas and healthcare programmes. We will work with Nigerian partners on other segments of the programme,” he said

GE attended the meeting with CEOs of nine other companies and seven partner companies from Nigeria including the Minister of Power, Professor Chinedu Nebo.

The Nigerian government is reforming its power sector to increase power supply stability. Part of the process was the handing over of the Power Holding Company of Nigeria to private owners late last year, a development that the Nigerian President, Goodluck Jonathan, told participants at the World Economic Forum in Davos, Switzerland, last week, that it was yielding results.

 

 

Power Sector: Electrification Agency Boss Suspended For Non-performance

The Managing Director of the National Rural Electrification Agency, Mr Kenneth Achugbu has been suspended.

Announcing his suspension on Tuesday, the chairman of the agency’s board, Senator Jonathan Zwingina said that Mr Achugbu was suspended for lack of executive capacity to implement the Federal Government programme in the power sector.

The suspension was announced after a board meeting which lasted for three hours.

Senator Zwingina also said that Mr Abubakar Wasaram, who is the most senior director, would replace Mr Achugbu as the acting Managing Director of the agency.

“The board shall set up task forces to undertake working tour of all projects in the Federation in order to determine their level of execution,” he said.

The board also directed the new managing director to reconstitute the management committee of the agency.

Nigerians Can Now Sue Power Sector Investors – Lawyer

A legal Practitioner, Emmanuel Umoren, on Friday warned the new private investors and owners of Nigeria’s power sector of breaching their contract with the people, insisting that consumers now have the power to sue them to court.

“Every transaction is a contract and if there’s any breach whatsoever they can be sued,” he said.

Mr Umoren who was a guest on Sunrise Daily, commended the government’s decision to privatise the power sector, making it a business which is liable to be sued if consumers discover a breach in the contract.

“It is business now. It’s no more government money. Let these DISCOs know that (now) we can take them to court. That’s a very important part. We can now take them to court because they are business men,” he said.

He highlighted some circumstances in which consumers can sue the power companies, including power surge (which leads to damages). On cases of in availability of electricity, Umoren said “it is going to be very difficult to sue them for not providing you light,” but added that the position may change as time goes on and with the intellectual improvement in the judiciary system.

On complains of power shortage in some areas, Umoren said “my major problem is that we do not think these things through because you are creating monopolies in areas.” He explained that the issue of metering lies with the distribution companies (DISCOs) and added that efforts are being made by investors to check cases of power theft by citizens as such usages are unaccounted for.

He however complained about the unavailability of options for end users leading to monopoly which does not benefit Nigerians. He said there should be options in case consumers are not satisfied with the services of a certain distribution company and added that consumers should be able to switch to any DISCO of choice as such is obtainable in other climes.

On the increase in service charge(s) raised twice within the last year, Umoren questioned the activities of the new investors. “How did we arrive at the first price, if you did not do a thorough analysis of doing the business?” he asked.

On nationwide complains regarding fixed service charge of N750 which may be increased as well as payment of meter maintenance without getting the required maintenance services, Umoren warned the private investors that they are liable to court charges by citizens.

He also faulted the dominance of political cases at the Supreme Court which does not allow for the prominence of other issues, including business, which affect the citizens.

“The decisions that come from the Supreme Court and Appeal Court(s) are mostly political issues because they (politicians) have the money,” Umoren said.

Government Doing ‘Pretty Good’ In Power Sector – Mukan

An Energy Expert, Joshua Mukan, on Tuesday gave President Goodluck Jonathan’s administration a thumbs-up for its efforts towards delivering stable power supply for the citizens.

While giving his assessment of the energy sector on Sunrise Daily, Mukan said: “I think the government is doing pretty good within the time frame they came into power.” In his opinion, the investments and expenditures made toward the sector within the past three years show that “this government has really tried to take (away) the problems of our power sector, uprooting it from the bottom.”

For Nigerians to have access to constant electricity supply, all three energy sub-sectors – power generation, power transmission and power distribution – will have to function efficiently.

“No matter how efficient the power generation sub-sector does, if it is not transmitted very well, or distributed very well, the customer is dissatisfied.”

Mr Mukan, who commented on the efforts of the Power Holding Company of Nigeria (PHCN) despite the dilapidated state of the existing infrastructure prior to the commencement of the power sector reform, stated that the “PHCN did its own best” which failed to yield desired results.

Following the official handover of the power sector to private investors, Mukan warned that it may take time before the impact would be felt by end-users. “The amount of investments that have come in right now, for the power industry, believe me, my understanding is that it may take a little bit of time to materialise.”

He said the government had invested heavily in thermal plants which should not take much time to come on-stream compared to the hydro-electric power plants. He added that it may take a maximum of one year for thermal plants to begin operation.

He stressed the need for the government to invest in other power options, particularly gas.

“Nigeria is now to be one of the biggest world petroleum producing countries and one would imagine that gas should not be a problem in this country. But unfortunately, one of the greatest problems we have to our thermal plants is the availability of gas,” he said.

He highlighted ‘lines of failures’ between gas production and distribution to the thermal plants including vandalism or explosion at a rig.

 

Governor Obi Commissions Agu Awka Power Plant

Anambra State Governor, Mr. Peter Obi, has commissioned the Agu Awka Power Sub-station in Awka.

This is a joint project of the Federal, State and Local Government under the direct supervision of the Niger-Delta Power Holding Company Limited.

While commissioning the project which is expected to ensure steady supply to Awka and environs, Governor Obi emphasized that the project will help the entrepreneurial spirit of the Anambra people to be motivated, and consequently help industrial activities to thrive in the state.

He also expressed gratitude to President Goodluck Jonathan for his commitment to bringing about transformation in the power sector.

Also briefing the audience at the event, the Managing Director and Chief Executive Officer of the company, Mr. James Olowu not only assured of the usage of the best equipment in the project, he also commended the Anambra State Government for having invested a lot in the project.

The Managing Director then took the Governor round the facility, through the control room that has 33KVA Panels which is the power house of the substation.

In a similar development, Governor Peter Obi has also handed over to 58 directors in the Anambra State Civil Service, cars for their daily operation and running of their different departments.

The directors described the gesture as unprecedented and that it has rekindled in them the hope that they are part and parcel of the present administration.

The keys to the vehicles were handed over to the Anambra State Head of Civil Service, Mr. Chidi Ezeoke.

FG To Go Ahead With PHCN Assets Handover

Despite the threat of a nationwide strike by electricity workers come November the 1st, the federal government says it would go ahead with the physical hand over of the company’s assets to the new owners on that day.

The Permanent Secretary, Ministry Of Power, Mister Godknows Igali, announced this after a meeting with Vice President Namadi Sambo, on the power privatisation process.

He added that the federal government had made significant progress in the payment of the disengaged workers, saying 40,093 out of the 47,913 identified disengaged PHCN workers had been fully paid their entitlements which he put at 294.4 billion Naira.

It will be recalled that President Gooduck Jonathan had formally handed over the Power Holdings Company of Nigeria, PHCN, to private organisations that bought it, with a pledge that they would take over the companies without any liabilities.

The President who personally gave out the licenses and share certificates to the investors at the Aso Rock Villa stated that liabilities of the PHCN would be managed by Nigerian Electricity Liability Management Company, NELMCO.

Privatisation is 101 Per Cent Solution To Power Problem – Onofowokan

The Managing Director of Power Systems Limited, Mr Bimbo Onafowokan has said that the privatisation of Nigeria’s power sector is the answer to the problem of power failure, adding that the sector will eventually meet the people’s needs of electricity.

Speaking as a guest on Business Morning on Tuesday, he said “if we have been doing something for over 50 years and it hasn’t gotten us to our desired place, why don’t you try something else? I don’t believe it will get worse, it can only get better”.

Comparing the situation in the power sector to that of the telecommunications when it was newly privatised, Mr Onofowokan expressed hope that just as the telecoms industry faced and conquered its challenges, the power sector would do same.

“I believe we would see repeat in the power sector where the regulators would have a lot of challenges to bridge the gap between the desires of the consumers and those of the operators,” he said

Speaking about the controversy surrounding former staff of the power holding company that were paid off, Mr Onofowokan said “change has to happen.”

National Economic Council commends FG on prosecution of subsidy suspects

The National Economic Council (NEC) on Thursday commended the Federal Government on its decision to arrest and prosecute all the oil marketers who were wrongly paid subsidy money.

Briefing State House correspondents on the outcome of the NEC meeting, the Anambra state governor, Peter Obi said from the report made available to the Council some of the oil company have started refunding the subsidy money they had fraudulently collected and that those who have criticised the administration should now know that what the government was crying about was not in vain.

“The Council commend the Federal Government on its present stand of prosecution of those who were wrongly paid subside money and on the need for them to return same fully,” Mr Obi said.

“The Council also supports the Federal Government on its commitment to privatization on power sector,” he added.

According to him, the Council maintained that the petroleum sector needs to be cleaned up.

Vice President Namadi Sambo, who presided over the NEC meeting, which deliberated on good governance, the 370,000 jobs promised Nigerian youths, urged state governors to key into the vision of the current administration and to ensure that jobs are made available to Nigerians in their respective states.

Another issue which drew the attention of the Council was the need to organise a nonpartisan good governance publicity tour to showcase federal and state projects across the six geo political zones of the country.

The Council recommended that the tour should be organised by the Minister of Information.

Speaking on this issue, the governor of Akwa-Ibom State, Godswill Akpabio said the essence of the tour is to “highlight the good thing that is happening in democracy in Nigeria.

According to him, this tour “has nothing to do with the platform within which somebody was elected. So whether it is an ACN state or a PDP state or an ANPP state is immaterial. What is material is the fact that this tour is going to highlight those good things that are happening, the dividend of democracy that are being delivered to the people.”

The Council also deliberated on the soft loan the federal government is collecting to repay in 40 years. The loan will be used to fight erosion problems in the country. The Council insisted that so far, it is comfortable with the loans collected.

What may be important is what it is doing with such money, hence the need for good governance tour across the country.