Politics of the power sector (2)

(By Favour B. Afolabi) 

Although the country has been ill-famed for the wrong reasons, not many know that the NIPP is the single largest power project by any country in the world right now. It is a massive undertaking that is replacing the country worn radial infrastructure with a loop system that would ensure multiple sources of power supplies to consumers across the country.

Continued from yesterday

ALSO, the NDPHC has added 274 kilometres (km) of transmission lines to the national carrying capacity through the completion of six transmission projects namely, the 330KV DC Ajaokuta-Lokoja-Gwagwalada lines, 222Km; 330KV DC Ihovbor-Benin Main-Oshogbo Line A, 17km; 330KV DC Papalanto-IkejaWest-Ayede line, 16KM; 330KV DC Ganmo-Jebba-Oshogbo SC-Turn In/Turn Out Line, 12KM; 330KV DC Omotosho-Ikeja West Line, 5Km; and the two-kilometre, 132KV DC Ganmo-Ilorin-Oshogbo Turn In/Turn Out line.

Furthermore, the NDPHC has strengthened the transmission capacity of 12 substations, built three new ones from the scratch and rehabilitated two across the country, with a cumulative capacity of 2,370MVA. In the distribution end of the NIPP project, the NDPHC also has a haul of 30 completed zonal projects as follows: Abuja zone two; Benin zone two; Eko zone nine; Ibadan zone six; Ikeja zone six; Kaduna zone three; and Jos/Yola zone two.

And, as part of the NIPP, the NDPHC is overhauling the country’s transformer system by putting the huge 3000KVA-50000KVA low voltage range of transformers out of service and replacing them with hundreds of thousands complete, self-protective (CSP) high voltage transformers in the 25-50KVA range.

Attached to two or three homes at the maximum, the CSPs are being deployed nationwide to end the phenomenon of plunging whole neighbourhood into darkness whenever the sole transformer serving several streets pack up, among other problems associated with the central transformer system.

Although the country has been ill-famed for the wrong reasons, not many know that the NIPP is the single largest power project by any country in the world right now. It is a massive undertaking that is replacing the country worn radial infrastructure with a loop system that would ensure multiple sources of power supplies to consumers across the country.

(D) State of gas supply to these plants:

The World Bank has begun to provide Partial Risk Guarantees (PRGs) to support Nigeria’s gas sector to bring more electricity to consumers and one of such Gas Supply and Aggregation Agreement (GSAA) has just been executed for Egbin Power Plc/plant between the bank, Power Holding Company of Nigeria, Chevron Nigeria Limited and Deutsche Bank. Under the 10-year GSAA, which is based on the industry template developed by the Nigerian National Petroleum Corporation, Chevron will provide gas to Egbin power plant for power generation. This will be the first time that Egbin power plant will be able to procure gas under long-term arrangements.

The World Bank’s PRGs being provided under the IDA-financed Nigeria Electricity and Gas Improvement Project (NEGIP), is key to enabling long-term gas supply; the PRGs will be used to cover private lenders against the risk of a public entity failing to perform its payment or contractual obligations. The NEGIP PRGs will be instrumental to achieving financial closure of the Egbin GSAA transaction by providing payment security for Chevron for the supply of gas to the plant.

These long-term contracts enabled by the PRG will also help to encourage investments in upstream gas production by international and domestic oil and gas companies; this will help to catalyse long-term private investments in Nigeria’s gas sector and underpin future investments in the power sector. Subsequent PRGs will support other gas supply agreements to these power plants even as the World Bank has already committed itself to a series of PRGs totaling $400 million, of which the one for Egbin is the first to be signed. This template of course will be eventually replicated across all the power plants.

(E) State of the hydro power sources:

The Federal Government is also investing heavily to boost generation through the large, medium and small Hydro plants with the total capacity of over 4,234mw being: Zungeru – 700mw; Mambilla – 3050mw; Gurara second phase -360mw; Itsi – 40mw; Small Hydro plant – 84mw.

(F) State of the Rural Electrification Agency (REA)/projects:

This agency which at inception inherited 2,269 projects from the Ministry of Power has successfully completed and inaugurated 323. A balance of 1,946 of these projects is at different levels of completion. The agency, on its own, awarded contracts for 158 rural electrification projects (113 grid projects and 45 solar-based projects). Sixty-five of these have been completed and inaugurated, while the remainder is at different levels of completion. This agency, which was suspended under the last administration under some controversial circumstances, has been resuscitated by Jonathan’s administration and currently has N10 billion-plus earmarked to it by the Ministry of Power within the 2013 budget to complete these projects.

(G) State of the other sources of power:

Another 1,896mw is being expected from Independent Power Producers (IPPs) such as Aba IPP, etc, while another 806mw is being expected from the Federal Government legal assets before the end of this year, 2013.

There are also no fewer than 50 other Nigerian private IPPs registered by Nigerian Electricity Regulatory Commission (NERC) of different capacities that have either been connected to the national grid already or are being connected to it.

(H) State of the sector before Goodluck Jonathan and his legacy:

Then there is this group that would tell you that “President Jonathan should stop making excuses for his failures in this sector because PDP has been in office for 14 years and that he should not talk about the wasted years of the military when it comes to development of these infrastructure.”  No one can change historical facts. Yes, Jonathan is a member of the PDP but he can only answer for his own time in office; and yes, if the military had invested in power as Jerry Rawlings, also a military man did in Ghana, or Hosni Mubarak, a maximum dictator did in Egypt, the incoming governments won’t be struggling with power as they are doing now and they would have been able to invest such funds elsewhere such as in the Education and Health sectors.

So, these commentators should blame the likes of Buhari, IBB, Abacha, and Abdulsalam and their cronies that ran the nation for many years for not building critical infrastructures like power and others; these commentators are the same people that would begin to quote crazy figures that they believe the PDP has spent on the power sector for 14 years without telling the public that some of these 18 power companies being privatised; 11 NIPPs; five hydro plants; and other transmission grid improvements were built with these same funds.

There is nowhere in the world where a current leader is blamed for the failures of his predecessors even though some of them belong to his political party. That logic cannot hold water in Nigeria – every President and his administration will always have specific successes and failures attached to it by history irrespective of how some commentators try to distort the facts. Obasanjo’s Administration will always be remembered for the telecommunications privatisation exercise that produced the MTN/Econet/Globacom/Etisalat, etc revolution in Nigeria that has now produced more than 100 million subscribers in more than 10 years, as well as communications revolution; the late Umar Yar’Adua government will always be remembered for the Niger Delta Amnesty programme that went on to provide an atmosphere of peace in the region which has allowed the nation to be able to produce 1.5 million barrel of oil per day.

In the same way that Jonathan cannot lay claim to those successes, he can also not be blamed for the failures of those administrations. He will have to be judged by what he is able to achieve while in office. It is now very apparent that Jonathan would be claiming this trophy as regards the power sector – I just hope that when that happens, these same folks won’t come and say “ehn, he is not the one that did it, na Obasanjo and Yar’ Adua do the real work wey hin come enjoy” or “ehn, shebi it is the normal duty of government to provide services to its people, there is no big deal there, South Africa has had 48,000mw for more than 20 years already, wetin we dey celebrate.”

CONCLUDED

• Afolabi is president at Viva Real Estates Company and a consultant to several infrastructural development projects.

“Opinion pieces of this sort published on RISE Networks are those of the original authors and do not in anyway represent the thoughts, beliefs and ideas of RISE Networks.”

 

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