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National Union of Electricity Employees, NUEE, has decried the worsening electricity supply across the country eight years after the privatization of the assets of the defunct Power Holding Company of Nigeria, PHCN.
President of NUEE, Engr. Martin Uzoegwu, in Lagos, contended that the only workable and practicable option for resolving the challenges facing the power sector was “a total reversal of the whole privatization exercise because it is not working and cannot work.”
According to him: “We reiterate like we have done in the last 13 years that the solution to the power challenge in the Electric Power Reform process is total commercialization of the sector. This option will give the companies the opportunity to charge economic tariffs with human face considering the purchasing power of the citizens and the regulatory directives.
It will help to solve the twin problems of funding and investments in the whole value chain of the power sector. Power is not only a business but also a social service and one of the commanding heights of the economy.
“If we resolve the power debacle, Nigeria will solve a lot of socio-economic problems with one stone. These may include but not limited to reduction in unemployment, reduction in the rate of organised crimes and other social vices, creation of small and medium enterprises in the rural and semi-urban areas, reduction in the cost of energy for manufacturing firms thus reducing the cost of goods and services and increase in turnover which could lead to more direct and indirect employment, reduction in rural-urban migration, rapid development of our industrial capacity and increased life expectancy as a result of less stress, better health management etc.
It will also lead to more revenue for government as access to electricity will increase income from tariffs, rapid development of the country in the area of industrialisation, foreign direct investment, FDI, more worker-friendly environment with good pay and welfare packages and reduction or elimination of power poverty.
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According to him, “in Nigeria the power sector, long neglected by successive governments was primed for privatization. This feat was achieved in 2013 when the PHCN was unbundled to 11 Distribution and six Generation companies and sold to different private companies while one Transmission Company is still owned by the FG.
The government mantra was that the private sector would provide infrastructure and utilities more effectively and attract investment.
“A long list of reasons was given why the privatization of the sector must happen.
They include Grid energy insufficiency and instability, network infrastructure challenges (overloaded transformers and feeders, obsolete equipment, limited network, lack of automation, etc), Gas limitation to the generation companies, annual water shortages at the hydro-generation station, metering challenges (huge metering gap of over 6,000,000, estimated billing, poor meter maintenance, etc), operational challenges (long feeders, quality of workforce, large operational areas, etc), funding challenges (absence of long term “patient” capital (equity/debt) to fund capex investment, high cost of borrowing, poor history of DisCos, etc), lack of investment/upgrade of equipments and facilities, lack of diversification to other forms of energy, health, safety, and environmental issues.
He said since the privatization, “tariffs have been increased three times and the fourth increase is imminent.
This continues to put additional burdens on Nigerians who do not actually enjoy adequate power supply. The only beneficiaries of this regime are generator importers who continue to have a field day.
Uzoegwu, “This year marks the eighth anniversary of the privatisatiion exercise, and the same issues have remained unsolved. Citizens and industries still do not have reliable power supply. Even with installed capacity at 12,522 MW, the nation has not been able to generate beyond 4,000 MW, which is insufficient for the population of 200 million. Added to these are the periodic price hikes, a variety of tariffs and estimated billing.
Recall that electricity on the grid on November 1, 2013, when the sector was privatised was around 3,400MW. Since then, the highest peak power ever generated and transmitted in Nigeria was 5,802MW on March 1, 2021, which was evacuated at a frequency of 50.09 hertz. Nigeria is supposed be generating over 20,000MW by now. While the transmitting capacity has improved to wheel well over 8,000 MW through the GRID, we still have less power to pass through the system for the Country.
And we continue to pay them for doing nothing to upgrade the capacity in the Country. As we speak, power generation has again dropped to below 4,000 MW.
Disturbingly, the GenCos have jettisoned the primary objectives of generating power as contained in their MOU to sundry businesses around the power stations. We can authoritatively say without fear of contradiction that some prefer these other businesses to revamp the generating machines.
Source: Vanguard News
This post was written by Chinedu Ibeakanma.
The views expressed here belong to the author and do not necessarily reflect our views and opinions.