ISSUES IN THE NIGERIAN POWER SECTOR

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The Nigerian power sector is one saddled by huge debt, the Federal Government owed N185 billion judgement debts due to aggrieved parties challenging in court decisions by government officials that were not thoroughly evaluated. This was pointed out at a symposium to mark 2012 Democracy Day by former President Goodluck Jonathan. Currently, the sum for judgement debts as of May 2018, was reported that two arbitration awards totalling $8.9 billion (about N2.7 trillion) have been made against Nigeria. The judgement obligations emanated from the Olusegun Obasanjo, Umaru Yar’adua and Goodluck Jonathan contractual actions.

However, the Nigerian government seem unfazed by the burden of judgement debts. This is the inference drawn from the manner in which the Minister of Power, Works and Housing, Babatunde Fashola responds to contracts the government entered into with core investors for electric assets. According to the minister, ‘the Distribution Companies (Discos) understood the rudiments of the Power sector before opting in and as such must compete to deliver or exit.’

At a press briefing held on July 9, 2018, on the state of the power sector, the Minister admitted that there is enough blame to go round the stakeholders in the power sector. His speech, however, carefully exonerated the Government been derelict in its responsibility in the Nigerian Electric Power Supply Industry (NESI). All the challenges in the industry are traceable to the belligerence and inefficiency of the Discos.

Read: Has privatisation failed the power sector?

 

UNMETERED CUSTOMERS BEHIND 70% LOSS IN POWER SECTOR

The Executive Director, the Nigerian Electricity Distributors, Sunday Odutan, and the Managing Director, Abuja Electricity Distribution Company, Ernest Mupwaya have attributed the highest amount of loses in the Nigerian Power sector to areas with high concentration of unmetered electricity consumers. It was also gathered that about 70% of the losses accrued to Electricity Distribution Companies are from these areas. The duo confirmed this earlier this week and stated that recent studies from Power firms revealed that the companies earn more from high concentration areas with metered consumers. The duo stated this while speaking at the inauguration of the second phase of the 222,728 mass metering programme at AEDC Abuja. “It is true that revenue generation will be assured when we meter people, this is the reason for the meters AEDC has been rolling out.”

On other causes of losses in the power sector, Mupwaya stated that the increase in the cost of Energy sold by Generation Companies without a commensurate increase in tariff payable by power uses is contributory to the liquidity squeeze in the power sector. ‘So if the price at which we are buying is already high, without a corresponding increase in tariff, even if we make 100% collection from customers, there will still be a gap and this is real”, he said.

On the mass metering program of the AEDC, he stated that the industry invested N10billion in the second phase of the exercise, adding that the latest development of meters in the Discos franchise areas has reduced metering gap.

 

FOUR YEARS IN BLACKOUT: BADAGRY RESIDENTS CRY OUT

Economic activities are at a standstill in the ancient town of Badagry. This is as a result of a prolonged (four years and still counting)  power outage. Residents of the coastal town have cried out and accused the Eko Electricity Distribution Company (EKEDC) of “total neglect” in the area. Mr Femi Ilori, a resident of Topo-Badagry, said it is saddening as the town has been in darkness since 2014 and living in the town has become totally unbearable.

The present administration of Gov. Akinwunmi Ambode, also promised power supply when he came to launch Light up Lagos, a Rural Electricity project in Badagry. In spite of the promises, Badagry is still in darkness and no power supply in the homes or offices of the residents. He appealed to the EKEDC responsible for electricity in the area to restore supply to avert the suffering and closure of businesses in Badagry.

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