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Tag: Electricity

  • Manufacturers kick against impending electricity tariff hike

    Manufacturers kick against impending electricity tariff hike

    The Manufacturers Association of Nigeria (MAN) has described the plans to increase electricity tariff from July 1 as outrageous.

    The association said the real sector was currently uncompetitive from the high prices used to generate power from alternative sources.

    Mr Segun Ajayi-Kadir, Director-General, MAN, made this known in an interview on Friday in Lagos.

    Recall that the Nigerian Electricity Regulatory Commission (NERC) said the increase was in response to the rise of the pump price of premium motor spirit (PMS), the rise in inflation rate which was  at 22.41 per cent, and a shift in the exchange rate from N441 to N750.

    Ajayi-Kadir said a 40 per cent tariff increase at this time would engender higher costs of production, lower profit margin, manufacturing activities paralysis, lower revenue remittances to government among others.

    He stated that the absence of stable, effective and fairly priced electricity supply in Nigeria had been a long-standing challenge  for manufacturers which compelled them to supplement with alternative energy sources.

    Regrettably, he noted that the available alternative energy sources such as diesel had become exorbitantly expensive.

    The MAN director general said that manufacturers spent at least N144.5 billion on sourcing alternative energy in 2022, up from N77.22 billion in 2021, translating to 87 per cent increase in the cost of access to alternative energy sources.

    He said  the fact that government itself was owing N75 billion in unpaid electricity bill was indicative of how burdensome the cost of electricity had become.

    “Already, we have power constituting between 28-40 per cent in the cost structure of manufacturing industries.

    “You can imagine the impact on manufacturing industries that are energy-intensive such as metal processing, heavy machinery, and chemicals manufacturing.

    “A spike in the electricity tariff will erode the profit margin of the manufacturers and reduce their ability to expand operations and create new jobs.

    “Manufacturers will ultimately pass on the additional cost to the consumers of their products and this will increase the cost of the products in the market and complicate the rising inflation rate in the country.

    “Also, the sector’s competitiveness will definitely worsen as the high cost of the products will make locally produced items less competitive, when compared with imported alternatives,” he said.

    Ajayi-Kadir advised the Federal Government and Nigerian Electricity Regulatory Commission (NERC) to instead,  ensure improved electricity generation, transmission and distribution to meet the revenue needs of the electricity supply industry stakeholders.

    He stressed that government should ensure that at least , 90 per cent of electricity consumers were metered to ensure consumption reflective electricity bill payment.

    He also tasked government to formulate electricity policies that would aid investments in energy industry to increase generation capacities and usher in large scale production of electricity.

    “There is an urgent need for  diversification of energy sources and intensifying infrastructure investment in the power sector.

    “As it is today, the manufacturing sector, which is the engine of growth, is still struggling as a result of inclement production environment in Nigeria.

    “The expectation is that government will engage in extensive and intensive consultations with the manufacturers; focus on measures that will salvage the sector and halt the trend of shutdown of factories, knowing the implications and the multiplier effects on employment and the economy.

    “Care should be taken to avoid introducing burdensome measures that will further strangulate the manufacturing sector and the whole economy,” he said.

  • What we are doing to ensure improved electricity supply – FG

    What we are doing to ensure improved electricity supply – FG

    Permanent Secretary, Ministry of Power, Mr Temitope Fashedemi says the Federal Government is making efforts to further improve, stabilise and sustain power supply.

    Ms Chinwe Udouwem, spokesperson of the ministry stated in Abuja on Thursday that Fashedemi made the declaration when the Special Adviser to President Bola Tinubu on Energy, Ms Olu Verheijen visited the ministry.

    “We are hopeful that you will identify some of the issues confronting the sector as technical directors and heads of agencies under the ministry brief you on on-going or concluding projects,’’ Fashedemi said.

    In her remarks, Verheijen said the power sector was critical to growth and productivity of nations.

    She noted that reforms embarked upon in the power sector over the years would bring about the much-desired positive impact.

    She stressed the need for synergy between stakeholders in the power sector and a holistic approach to achieve a lasting solution.

    “We must create an enabling environment that allows the private sector to grow and arrive at affordable electricity tariffs for households, the major consumers of electricity,’’ she said.

    Earlier, technical directors and heads of agencies under the ministry took turns to speak on challenges and the way forward to make the power sector an enviable one.

  • Lack of electricity forces Anambra Tribunal One on long recess

    Lack of electricity forces Anambra Tribunal One on long recess

    …as panel rejects LP offer of free fuel

     

    Despite being forced to take a long adjournment due to lack of electricity in the courtroom to play a video recording introduced by the Independent National Electoral Commission(INEC) and other energy-powered basics, the National Assembly Election Petition Tribunal One panel chaired by Hon Justice L. O. Ogundana however turned down the offer by lawyer to one of the respondents to provide the tribunal with diesel to power the court’s generating set to enable things proceed on schedule.

    The petition ref EPT/AN/SEN/05/2023 was brought before the three-man panel by the Anambra Central Senatorial candidate for the All Progressives Grand Alliance (APGA), Hon Dozie Nwankwo, popularly called “Onyendozi” against Chief Victor Umeh of the Labour Party seeking his ouster.

    The literally steaming and discomforting courtroom made the panel to adjourn to Saturday and Sunday, July 8 and 9,2023.

    This was with the hope that the poor electricity supply would have improved or fixed.

    The adjournment came after turned down an humble offer by Chief Alex Ejesieme(SAN), counsel to INEC to offer a self will donation of large quantity of diesel for the court complex generating set.

    The panel’s Chairman, Justice Ogundana politely declined, saying he didn’t want petitions flying around against the panel over the gesture.

    He however bemoaned the unfortunate situation where the tribunal sits in very uncomfortable atmosphere. There was no lighting, fans or airconditioners. He compared the hot, dusty, and unfriendly courtroom with broken windows to his experience in Edo State that was so clement with 24hours electricity supply with all the air conditioners in proper condition.

    However,Ejesieme (SAN),assured that he would take the matter to the Anambra State Chief Judge immediately after the session.

    Earlier while giving witness in one of the petitions brought against him, this time from Princess Helen Mbakwe, a legal practitioner Senator Victor Umeh insisted that the logo of the New Nigeria People’s Party on the ballot papers used for the Anambra Central senatorial election on Feb 25,2023 was the actual one approved by the national secretary of the party during parties meeting ahead the election at the INEC headquarters.

    Umeh’s stand contradicted the position of NNPP’s candidate that her party’s logo was not on the ballot papers for the election.
    Umeh stayed till now.

  • Electricity customers increase to 11.27m in Q1 2023 – NBS

    Electricity customers increase to 11.27m in Q1 2023 – NBS

    The National Bureau of Statistics (NBS) says the number of Electricity Distribution Companies (DisCos) customers in Nigeria increased from 11.06 million in Q4 2022 to 11.27 million in Q1 2023.

    According to the NBS Nigeria Electricity Report for Q1 2023 released in Abuja on Wednesday, the figure showed an increase of 1.89 per cent.

    The report focuses on energy billed, revenue generated, and customers by DISCOS under the reviewed period.

    The report said on a year-on-year basis, customer numbers in Q1 2023 increased by 5.99 per cent from 10.63 million reported in Q1 2022 to 11.27 million in Q1 2023.

    It said in Q1 2023, the number of metered customers stood at 5.31 million from the 5.13 million recorded in Q4 2022, this indicated a 3.61 per cent increase.

    “ On a year-on-year basis, this grew by 5.71 per cent from the figure reported in Q1 2022 at 4.79 million. ”

    Similarly, the report said that estimated customers stood at 5.96 million in Q1 2023, this was higher by 0.40 per cent from the 5.93 million recorded in Q4 2022.

    On a year-on-year basis, estimated customers increased by 1.99 per cent in Q1 2023 from 5.84 million recorded in Q1 2022.

    The NBS said revenue collected by the DISCOs in Q1 2023 was N247.33 billion compared to the N232.32 billion collected in Q4 2022.

    The report said on a year-on-year basis, revenue generated rose by 20.81 per cent from N204.74 billion recorded in Q1 2022.

    It said electricity supply increased to 5,852 (Gwh) in Q1 2023 from 5,611 (Gwh) recorded in Q4 2022.

    However, the report said on a year-on-year basis, electricity supply declined by 1.74 per cent compared to 5,956 (Gwh) reported in Q1 2022.

  • President Tinubu: From Renewed Hope to renewed ‘shege’?

    President Tinubu: From Renewed Hope to renewed ‘shege’?

    Less than a month, Nigerians have already started feeling the impact of President Bola Ahmed Tinubu’s administration which was inaugurated on May 29th.

    On inauguration day, Tinubu made the controversial decision to remove fuel subsidy payments, and the price of Premium Motor Spirit (PMS), popularly known as petrol, immediately skyrocketed across the country.

    Petrol that hitherto sold between N210 and N220 per litre went as high as N850 per litre in some locations across the country and has remained in the range of N500 and N520 per litre.

    While Nigerians were still grappling with the effects of the removal of fuel subsidy payments, the Central Bank of Nigeria (CBN) announced a devaluation of the Naira, aligning with Tinubu’s commitment to a unified exchange rate.

    While the intention is to streamline the foreign exchange system, the devaluation has already begun to affect businesses and investors. Industries such as Dangote Group are already feeling the initial repercussions.

    These developments have stirred concerns and comparisons to the biblical story of King Rehoboam, raising questions about the future of the Tinubu administration and the welfare of Nigerians.

    When Rehoboam was made King, the whole assembly of Israel came to him and said, “your father put a heavy yoke on us but now you should lighten the burden of your father’s service and the heavy yoke he put on us, and we will serve you”.

    However, as the popular Bible story goes, Rehoboam answered, “Go away for three days and then return to me”. Then King Rehoboam consulted with the elders who had served his father and the young men who had grown up with him.

    While the elders advised Rehoboam to make the yoke of the people lighter, the young men advised him thus: “My little finger is thicker than my father’s waist! Whereas my father burdened you with a heavy yoke, I will add to your yoke. Whereas my father scourged you with whips, I will scourge you with scorpions”.

    True to the letters, after three days, when the whole assembly of Israel returned to the King, he answered the people harshly, rejecting the advice of the elders and spoke to the children of Israel as the young men had advised.

    When all Israel saw that the King refused to listen to them, they answered the king: “What portion do we have in David, and what inheritance in the son of Jesse? To your tents, O Israel! Look now to your own house, O David!”

    When King Rehoboam sent out Adoram, who was in charge of the forced labour imposed on the Israelites, they stoned him to death, leaving the King running for his dear life. Rehoboam’s reign was marked by rebellion against the house of David.

    The sudden removal of fuel subsidy payments and the Naira devaluation have already ignited dissatisfaction and unrest among the populace.

    The hasty implementation of these measures without adequate consideration for the impact on ordinary citizens raises concerns about the potential consequences and stability of Tinubu’s leadership.

    As if these are not enough, there are already indications that the administration will very soon supervise the increment of electricity tariff by the Nigerian Electricity Regulatory Commission.

    According to reports, electricity tariffs are set to increase by over 40 per cent in the coming days, a development which may eventually end all forms of energy subsidy in the country. The tariff hike is reportedly due by July 1.

    More still, President Tinubu recently signed the Student Loan Bill into law, which many have said will make life miserable for Nigerian students and their parents.

    As Nigerians brace themselves for the implications of the policies of the Tinubu administration, the cautionary tale of King Rehoboam serves as a reminder of the perils of disregarding the concerns and well-being of the people.

    The response to these initial decisions will shape the course of Tinubu’s presidency, as the fate of his leadership hangs in the balance.

    Already, Nigerians have changed the renewed hope slogan of President Tinubu to renewed ‘shege’.

    Will Nigerians rally behind him or seek refuge in their own tents, questioning their place under the rule of President Tinubu? Only time will tell.

  • Harder days ahead for Nigerians as Tinubu moves to end electricity subsidy by July 1

    Harder days ahead for Nigerians as Tinubu moves to end electricity subsidy by July 1

    Harder days ahead for Nigerians as the government of President Bola Ahmed Tinubu has concluded plans to discontinue with subsidy on electricity tariff in the country, IgbereTV has learned.

    This is in line with the ongoing reforms by the administration in the energy sector.

    The electricity tariff is set to increase by over 40 per cent in the coming days, a development which may eventually end all forms of energy subsidy in the country.

     

    With a monthly subsidy of about N50 billion still in the electricity sector owing to revenue shortfall, the tariff hike due from July 1, may be another acid test for the President Bola Ahmed Tinubu administration’s market reform.

     

    The administration has already removed subsidies on Premium Motor Spirit (PMS) and floated the naira, decisions that have complicated the price-setting of the Nigerian Electricity Regulatory Commission (NERC) 2022 Multi-Year Tariff Order (MYTO).

    Although the power sector players have been unable to meet the threshold of supplying at least 5,000 megawatts a year after signing contracts with NERC, NERC’s current Service Based Tariff (SBT) was benchmarked on an exchange rate of N441/$ and inflation of 16.97 per cent.

    Going by the NERC’s orders, in 2015, the average tariff across distribution companies (DisCos) and classes of end-users was N25 kilowatt, in order of 198/2020, which came into effect on September 1, 2020. The average tariff went to N60 per kilowatt; in the MYTO for 2022, the average tariff was N64 across classes of customers.

    The foreign exchange rate used in determining the 2015 tariff was N198.97/$, N383.80/$ was used in 2020, while N441.78/$ was used in 2022. The inflation used in the 2015 MYTO was 8.3 per cent, 12 per cent was used in 2020 and 16.97 per cent in 2022.

    Currently, the inflation rate is 22.41 per cent and some experts have projected that it would hit 30 per cent by the end of June given the floating of the naira and subsidy removal on PMS.

    Coming as the metering gap remained at over seven million, gas prices, losses and actual generation capacity are other elements in determining the tariff.

     

    While NERC’s projected tariff for July 2023 was expected to remove subsidy and increase the previously frozen tariff band D and E, increasing the bands from N54.59/kilowatt to N62.16 for band D and N48.37/kilowatt to N61.16 on average with an average increase across the bands moving to N67/kilowatt, the prevailing floating of the naira and spike in inflation is projected to move the new average tariff to about N88/kilowatt for the sector to recover the cost.

    Most stakeholders told a national daily that while the increase is unavoidable due to the changes in the parameters, households and small businesses, which should power the economy, may head for serious problems with energy costs alone rising to over 70 per cent as purchasing power remains a challenge in the face of unemployment and poverty.

    At the time of filing this report, available electricity on the grid stood at 3,057.7MW from 17 power plants. The average load intake of all the DisCos in the last four months averaged 3,000MW, a development that follows the persistent push to make the DisCos meet up with 100 per cent of their remittance orders.

    With the question of affordability emerging as a major consideration as the grid remains unreliable, forcing it to make losses, stakeholders have expressed fear that Nigerian Electricity Supply Market may face tougher times managing outlook due to apathy that may come from consumers who are losing hope in the system and resorting to alternative energy.

    Energy expert, Prof Wunmi Iledare, said the restructuring of the forex market creates worries as it appears as a devaluation of the naira, adding that he’s not comfortable blaming subsidy removal and paying the right tariff for decoupling Nigeria’s economy from forex instability.

    According to him, people must support the government in its effort to stop the dollarisation of its economy even if electricity tariff and petroleum products prices rise to a not-too-comfortable market-clearing price.

     

    Iledare, however, questioned the current energy pricing in the country, adding that the PMS pricing which stayed after the NNPC announcement is anticompetitive based on the dominant firm market structure.

     

    “Price hike cannot just depend on forex in the electricity market. Market fundamentals are key to rate determination in a decreasing cost industry producing essential commodities, like power,” Iledare noted.

     

    Energy lawyer, Madaki Ameh, said the never-ending upward reviews of power tariffs have become some sort of blackmail on electricity consumers and should be addressed through the Consumer Protection Council or an organized body of electricity consumers.

     

    “Indexing the cost of electricity on the dollar is a huge mistake because most of the inputs for electricity supply are local. The DisCos are also holding Nigerians to ransom by failing to increase the supply base, thereby spreading the tariffs across a broader spectrum of consumers to reduce the unit cost of electricity,” Ameh said.

     

    He insisted that as long as there remain many unmetered consumers and many others not connected to the grid at all, the few consumers on the grid would continue to be subjected to unjust tariffs, which are not reflective of the quality of service delivered.

     

    Ameh hoped that the signing into law of the new Electricity Act would mark “the beginning of light at the end of the long tunnel of inefficient and epileptic power supply in Nigeria.”

    President of Nigeria Consumer Protection Network, Kunle Olubiyo stated that while the last major review of electricity tariff was benchmarked at $1/N400, the floating of Naira and harmonisation of the exchange rate put the exchange rate at about N750/$.

    “It will affect the tariff template and result in an upward review of electricity tariff.

    “As important as this may be, two things are quite imperative to help in achieving a win-win for the demand and supply side of the coin.

     

    Moving forward, governments through relevant regulatory institutions should liberalize end users’ customers ‘ access to effective metering and mass metering to help in drastically closing the ever-increasing huge metering gaps,” Olubiyo said.

    He asked the government to look into gas pricing and align it with domestic gas obligations.

     

    “Gas to power generation plants/ thermal plants should be allowed to access gas which should be traded in local currency,” Olubiyo said.

    Electricity Market Analyst, Lanre Elatuyi said the new tariff rate would have an impact on the tariff, stressing that the “naira devaluation is a big challenge to companies with dollar loans to pay,” a development, which he said, would affect the power generators who have dollar loans repayment obligations.

     

    “They will need more naira today to buy a dollar. They need to manage their exposure to foreign exchange risk. Even operators of hydro plants pay their concession fees in dollars. So, wholesale electricity price will be adjusted upward and this will get to the end users’ tariffs too,” Elatuyi said.

    Executive Director at PowerUp Initiatives For Electricity Rights (PowerUp Nigeria) Adetayo Adegbemle said while increasing tariff appears normal due to the prevailing situation, there is a need to review the whole process and encourage basing the electricity tariff against the naira going forward.

    “We have seen changes in the review yardstick before, and this could be an opportunity to review our tariff process,” he stated.

    Former President of the Chartered Institute of Bankers of Nigeria (CIBN) and professor of Economics at Babcock University, Segun Ajibola, said there is still a disconnect between the cost of electricity and the value exchange.

    “Nigerians are still struggling to keep pace with the cost of energy for business and household use. If the electricity tariff goes up as envisaged, the question remains if there will be value for the quantum of electricity so paid for.

    “The truth remains that if electricity supply is constant, of the right quantity and quality, the envisaged upward review in the tariff will be gladly absorbed by the populace,” he said.

    Ajibola disclosed that the positive multiplier effects of a regular power supply in a country like Nigeria would more than compensate for the anticipated increase in electricity tariff when the increase is compared with the cost of alternative sources of energy to SMES, other businesses and households.

    He noted that in the long run, the costs of some of the public infrastructures to the populace are expected to in the short run rise to the peak, then flatten and decline subsequently.

    “I believe the short-run pains of the higher cost of hitherto subsidized public infrastructures will turn to long-run joy for the generality of Nigerians with improved quality of management and accountability in our government-owned suppliers of those services.

    “The move to open up the production and supply of those items and services such as fuel, electricity and transportation is designed, I believe, to promote economic efficiency and accountability in making the products and services available for the generality of Nigerians.

    And if the current efforts at driving such public sector accountability are sustained, which I believe the new administration has the wherewithal to do, then Nigeria is on the march towards greater greatness,” Ajibola said.

  • Resolving Nigeria’s electricity conundrum – Dakuku Peterside

    Resolving Nigeria’s electricity conundrum – Dakuku Peterside

    Every Nigerian knows that we have an electricity problem. It has been a recurrent sound bite in development discourse in Nigeria post- independence. This challenge is generational and has defied all attempts in the past to solve it. And Nigerians are gleefully looking to the incoming administration to end the search for the solution to this hydra-headed problem and terminate Nigeria’s electricity conundrum. Whether this administration will succeed where others have failed in unravelling the electricity conundrum depends on its careful study and understanding of the problem. It will entail an in-depth review of all previous initiatives to solve the problem, and the current state of the whole electricity value-chain in Nigeria as well as providing bespoke strategies to provide sustainable electricity supply that meets the massive demand in Nigeria. Electricity, especially in Africa, connotes light, which signifies progress, knowledge, and awareness. Therefore, literarily, the absence of light is darkness; metaphorically, the lack of electricity connotes the dominance of darkness, which Africans associate with everything negative – witchcraft, poverty, stagnation, and even death. Little wonder the availability of electricity, or lack thereof, is significant to Nigerians.

    However, several studies have empirically proved that a lack of electricity correlates with poor human development indices. And on the flip side, access to reliable power can dramatically unlock higher quality of life. Three pertinent questions merit consideration: what is the current state of our electricity challenge ? What are some of the negative consequences of Nigeria’s electricity conundrum? And what solutions can the new administration pursue to solve the problem? Answers to these questions, though limited in detail and a rather snapshot of the current realities, provide a clear picture of the way forward for Nigeria and a bird’s eye view of the electricity ecosystem in Nigeria.

    The current state of electricity generation, transmission and distribution in Nigeria is a study in crisis. This crisis has become endemic and defied logic and common sense. First, Nigeria’s installed electricity generation capacity is said to be about 13,000 MW. However, actual generation capacity delivered to the national grid for transmission to Nigerians has during the past 8 years stagnated at an average 4100MW – 4200MW daily, even though during the past 2 years there has been a marginal improvement in energy quantities delivered to the grid reaching 4,753MW on February 2023. The consistent inability to deliver much beyond 33% of total installed generation capacity is a function of fairly long- standing market, infrastructure and regulatory challenges. This is for a population of over 200 million. Egypt’s installed electricity generation capacity was approximately 58,000 MW, making it one of the highest in Africa, with 100% access, for a population of about 80 million people. As of 2021, the installed electricity generation capacity in South Africa was approximately 58,000 MW, with 84.4% access for a population of about 60 million people. These two countries, with a similar economic size to Nigeria, produce and distribute about 15 times more MW than Nigeria, whose population is almost three times more.

    Second, Nigeria’s electricity distribution infrastructure needs to be updated and requires substantial investment. Transmission and distribution losses are high, resulting in a significant waste of generated electricity. Frequent system failures, such as blackouts and voltage fluctuations, are common due to inadequate infrastructure. Third, the regulatory framework for the Nigerian electricity sector has faced criticism for needing to be more effective and conducive to attracting investments. Inconsistent policies, bureaucratic hurdles, and difficulties enforcing regulations have hindered progress in the power sector. Fourth, electricity theft and non-payment of bills pose significant financial challenges for power distribution companies in Nigeria, affecting their ability to invest in infrastructure improvements and sustain operations effectively.

    Fifth, lack of a systematic, integrated approach to investment in the sector and a need for sufficient diversification among gas, solar, wind, nuclear, and hydro sources. And finally, inadequate planning in anticipation of demographics, domestic and industrial power needs, and sabotage of public power supply to favour the generator lobby. These factors compound our electricity conundrum and render most efforts in improving electricity ineffective.

    The consequences of this electricity quagmire are dire. Nigeria’s failure to actualise its full potential is partially attributed to this electricity conundrum. Studies have shown how the lack of reliable, affordable, and quality electricity has systematically underdeveloped our country in the past 30 years. And I will point out a few ways lack of electricity has stagnated our development or underdeveloped us.

    The first is that it impaired economic productivity. Electricity is a fundamental requirement for industrial and commercial activities. Without reliable power, businesses face operational difficulties, reducing productivity and competitiveness. Lack of electricity also limits the establishment and growth of new industries, hindering job creation and economic growth. As a result, the country’s inadequate power supply has induced low economic development and a high unemployment rate. The Africa Industrial Index Report and World Bank data show Nigeria has had a low industrial growth rate over the past two decades.

    The second is that it  significantly limited access to essential services. Electricity is a fundamental aspect of modern life and vital in providing critical services such as healthcare, education, food security and clean water supply. Without electricity, healthcare facilities struggle to operate medical equipment, schools face challenges in delivering quality education, and communities may lack access to safe drinking water. This limited access to essential services hampers human development and perpetuates the country’s poverty cycle. This partially explains why our poverty rate is one of the highest globally.

    The third is that it creates social and political tensions. The lack of reliable electricity can exacerbate political instability, particularly in fragile or conflict-affected states, and it can limit the government’s ability to provide essential services and create a sense of angst and frustration among electricity consumers. This has led to social unrest, political instability, and sometimes violence in the country.

    The fourth is the environmental consequences. The reliance on fossil fuel-based generators as an alternative power source contributes to increased carbon emissions, air pollution, and ecological degradation. Inadequate electricity infrastructure impedes the development and adoption of renewable energy sources, slowing the transition to a more sustainable and low-carbon energy system.

    The final impact is on security. Power outages and unreliable electricity supply have security implications. In urban areas, the absence of street lighting during blackouts can increase crime rates and compromise public safety. It can also negatively impact the operations of security systems, such as surveillance cameras and alarm systems, affecting overall security measures.

    We appreciate this electricity challenge and how it has played a crucial role in our stagnated development, and we keep trying to fix it. However, we have been making cyclic movements – “motions without movement” in the same spot. The government created NEPA, embarked on massive electricity power sector reforms in 2005, started Nigeria Bulk Electricity Trading Company in 2010, privatised Distribution Companies in 2013 and Generation Companies in 2014. Yet the challenge remains. Progress has been marginal. Power generation on the grid rose from a meagre 3,183 MW in 2013 to 4,753.9 MW in 2023. With about a sixth of our population, even Ghana has a dependable electric power generation of 4,710 MW, with the access of 85.9% against our 57%.

    How can the incoming administration rescue Nigeria from this intractable and malignant malady of electricity poverty?

    The new administration must understand the four-fold snags the electricity industry faces: an exponential increase in the demand for electricity due to a rapidly increasing population without commensurate investment in the supplyend; pervasive insecurity threats to power installations and gas infrastructure given that about 80% of grid-tied generation are gas fired; high electricity transmission and distribution losses; over-reliance on generators which last year cost more than $5.2billion for importing and running generators; and liquidity challenges faced by distribution companies due to low collection efficiency and theft.

    This understanding must lead them to declare a state of emergency on electricity. We can only imagine the multiplier effect of the government getting electricity right on our way of life. Nigerians over the generations have yet to experience sufficient electricity. The culture shock most Nigerians have when they go abroad is experiencing a constant electricity supply, and it takes a while to get used to it. This government must take Nigeria out of this “self-inflicted” electricity conundrum and put us on the road to sustainable electricity sufficiency.

    I will suggest a cocktail of options available to the government. The government must create the right policy environment and framework for increased private investment in power generation, leading to the modernisation of transmission infrastructure and management. It must work towards greater diversification of energy sources, emphasising renewable and clean energy sources. It is time the government considered nuclear energy as an option. If South Africa , Iran and Turkey can build nuclear power plants , we have no excuse not to. Government must review existing distribution concessions with greater due diligence on the financial health of distribution companies. It must implement a steep upward review of tariffs on generator imports after a given period of grace to discourage generator dependency, and the government must do this simultaneously with improvement in power supply. The government must upgrade and modernise the national grid to make it more flexible and compliant with current global trends. State Governments , with the new constitutional provisions must play a critical role in our drive towards power sufficiency .

    I am unconvinced that Nigeria is doing enough to fix this intractable electricity challenge that has held our development down from pre- independence. It’s from one tell-tale to another. Like a new chapter, the beginning of a new administration is not a time to blame past governments, the private sector, contractors, or consumers for our serial failure to fix power. It is time to assemble our best hands wherever they may be, be single-minded and drive the optimisation of electricity as a national project to unlock our true potential. The leadership of our country must show real commitment and strong will to improve the generation, transmission, and distribution of electricity. Nigerians expect nothing less. Failure is not an option—Nigeria’s economic, social, and political future hinges on solving our electricity conundrum.

  • TCN threatens to sanction erring electricity market participants

    TCN threatens to sanction erring electricity market participants

    The Transmission Company of Nigeria (TCN) has threatened to sanction erring electricity market participants, having given them notices and time to comply with the market rules.

    The market participants in the power sector are the generation, transmission, and distribution companies.

    TCN’s Market Operator (MO), Mr Edmund Eje, in a statement issued in Abuja on Tuesday, warned that one of the fallouts of the sanctions would be the partial or complete disconnection of defaulters from their point of connection to the grid.

    According to the MO, it is natural that some of the sanctioned players may attempt to politicise the action to score cheap points and whip up unnecessary sentiments.

    He, however, advised that consumers should be sensitive to the real issues, which is efficiency and survival of the Electricity Supply Industry (NESI).

    ”NESI is governed by rules which are absolutely necessary for the viability and sustainability of the sector. As such these rules are sacrosanct and must be complied with by all existing or new players in the sector.

    ”Essentially, the players in the power sector are the generators, transmission, and distribution companies.

    ”For all the players to interact effectively and create the requisite harmony for growth, efficiency, profitability and of course, continued sustenance of the sector.

    ”The rules set for governance and regulation of relationship between all in the sector must be obeyed and upheld,” he said.

    Eje said that some of these rules are domiciled with the MO, adding that adherence to the Market Rule is below expectation.

    He said that NESI market indiscipline was one of the major factors dealing a disastrous blow to the scalability and growth of the market.

    ”Participation Agreement is signed by all participants, but to comply with them is usually an uphill task for many.

    ”If the rules of every game are observed, there would be no need for sanctions,” he said.

    On the suspension procedure, he explained that when a participant violate the market rules the MO would first notify the participant in writing, specifying the violation and requesting that corrective action be taken within a specified period.

    Eje said that if the participant failed to comply with the notice, the MO may issue a notice of intention to suspend a participant’s access to
    the market.

    ”This notice will specify the reasons for the intended suspension, the proposed duration of the suspension, and the conditions for lifting the suspension.

    ”If the participant still fails to comply with the “Notice of Intention to Suspend’, the Market Operator may issue a ‘Notice of Suspension’, which may last for 30 business days.

    ”After the suspension period, the participant may apply for reinstatement by providing evidence of compliance with the market rules and any other conditions specified in the ‘Notice of Suspension’.

    ”The MO will review the application and make a determination on whether to lift the suspension or not,” the statement read in part.

  • NERC gives reasons for increasing rate of electricity tariffs

    NERC gives reasons for increasing rate of electricity tariffs

    The Nigeria Electricity Regulatory Commission (NERC) has disclosed the reasons behind the increasing rate of electricity tariffs across the country.

    TheNewsGuru.com (TNG) reports Aisha Mahmud, NERC Commissioner in charge of Consumers Affairs made the disclosure at the Customers’ Complaints Resolution Meeting Organised on Tuesday in Jos.

    Recall NERC had remained silent after it was first confirmed by TNG that electricity distribution companies in the country quietly hiked electricity tariffs across their franchise areas.

    The tariff hike was first observed on the Tariff Band A Non-MD, which increased from N57.55 per unit it was in December 2022 to N68.2 per unit in January 2023. It has remained so, checks confirm.

    However, according to Mahmud, the increasing rate of electricity tariffs was due to inflation, rising exchange rate, cost of gas, labour generation and other economic realities in the country.

    ”Inflation has gone up to double digit. The exchange rate, even the official rate, is crazy. Operators purchase most of their equipment abroad using the current exchange rate.

    “The cost of labour keeps increasing, among other factors,” the NERC Commissioner in charge of Consumers Affairs explained.

    On the meeting with customers, Mahmud said the commission was in Jos to educate customers on their rights and listen to their complaints with a view to addressing them on the spot.

    Speaking further at the meeting, she disclosed NERC will soon provide four million prepaid meters to electricity consumers in the country.

    Mahmud, who described the shortage of meters in the country as one of the biggest problems currently facing the commission, hinted that the challenge would soon be a thing of the past.

    She said that modalities had been put in place to provide the meters through the National Mass Metering Programme (NMP) of the Federal Government.

    ”Actually, metering is one of the biggest challenges that we have been facing in the last couple of years in the commission.

    ”I don’t think this is funny given that so much investments have been made in the power sector.

    ”It is said that in Nigeria, electricity generation started in Lagos as far back as 1826 with 20 megawatts. 126 years down the line, we are still talking about basic things as metering, a phase we should have passed a long time ago.

    ”Aside many interventions in that regard, including the zero phase of the NMP where over one million meters were provided, the first phase of the initiative will make available four million meters to customers,” she said.

    Mahmud, who said that all preparations had been concluded for the mass metering programme, explained that funding for the project would come through the Central Bank of Nigeria (CBN)

    ”We shall make available these meters to customers through the distribution companies and this is to show that the regulator is not just sitting but making efforts to see that all Nigerians have access to metres.

    ”So, we shall do all it takes as regulators to ensure that the issue of metering becomes a thing of the past. I strongly believe that with the plans ahead, we will overcome this challenge soon,” she said.

    Also speaking, Mr Abdu Mohammed, the Managing Director of Jos Electricity Distribution Plc (JED), said that the concerns raised by the customers at the meeting would be addressed immediately.

    ”Quite a lot of issues, ranging from metering, billing, power quality, complaints about our staff, among others, were raised.

    ”I want to promise that all these issues will be addressed immediately and, in terms of metering, we are very much on track.

    ”Few days back, we purchase 12,000 meters and they are currently in our store. We are expecting 305,000 meters in the forthcoming NMP phase one and the over 100,000 from the World Bank Intervention

    ”So, very soon, you will see traction in all pur franchise states and all our customers will be metered,” Mohammed said.

  • NDDC targets 3-month completion of electricity project for seven LGAs in Ondo +Photos

    NDDC targets 3-month completion of electricity project for seven LGAs in Ondo +Photos

    The Niger Delta Development Commission (NDDC) has set a 90-day completion target for its 132/33kv sub-station in Okitipupa, Ondo State.

    Speaking during an inspection visit to the project site at Okitipupa, the NDDC Executive Director, Projects, Mr. Charles Ogunmola, stressed that the contractor must work towards meeting the completion target since the project has hit 95 percent execution.”

    Mr. Ogunmola stated that the NDDC is committed to providing electricity to oil-producing communities in Ondo South Senatorial District that have been without electricity for the past 15 years, adding that the speedy completion of the sub-station in Okitipupa will help achieve that goal and move the people from the 20th century to the 21st.

    Mr. Ogunmola said: “We are committed to lighting up the seven local government areas and the oil-producing communities in Ondo South Senatorial District that have not been connected to the National Grid for the past 15 years.”

    According to the NDDC Executive Director, Projects, completion of the sub-station project will boost economic activities in Ondo State, address the people’s needs and improve their living standards.

    He said: “Access to electricity is essential for economic development and improving the quality of life. The lack of electricity has hindered growth and development in many communities in the Niger Delta region. Therefore, NDDC’s efforts to provide electricity to these communities will have a significant impact on their lives and contribute to the overall development of the region.”
    Mr Ogunmola added: “The completion of the sub-station in Okitipupa is part of NDDC’s mandate to provide infrastructure and development projects in the Niger Delta region. The Commission is committed to fulfilling this mandate by completing ongoing projects, and ensuring that projects are completed on time.”

    Noting that the NDDC is also working towards diversifying the region’s economy from oil-dependent to other sectors such as agriculture, tourism, and manufacturing, the NDDC Executive Director, Projects, said, “the provision of electricity will stimulate economic activities in the region, attract investment and create job opportunities. This is a step towards achieving sustainable development and reducing poverty in the region.”

    He was accompanied on the project inspection visit by the NDDC Director of Project Monitoring and Supervision, Engr. Nelson Onwo, and the Director of the Commission’s Ondo State Office, Mr. Salami Salami.