The above are some of the results of the terrible macro/micro conditions we have created in our Nigeria Electricity Supply Industry, NESI, which makes it almost impossible for the experts to believe we are going to have stable power supply in the near future if we continue on this part to perdition.
With the experience of BPE in attempting to sell our NESI assets to foreign investors, it is clear that it would be foolhardy to expect Foreign Direct Investment, as part of the strategy to get our Power industry on a good footing, because it is simply unprofitable as it is in the short term.
Here are some ideas we are suggesting to redeem the country from this malice:
Organize a 3 day experts forum followed by 3 days stake holders forum
Disengage Manitoba and all the so called technical partners retained by our DISCOs
Stop building new generating plants, but complete all ongoing projects and revive the old but recoverable plants
Break down the DISCOs into smaller units after activating the BPE sales clauses requiring certain levels of investment which all the DISCOs have failed to meet
Remove tariff collection from DISCOs and give multiple companies
Government should assist companies acquire loans on favorable terms
Alternative energy and off-grid solutions should be vigorously pursued, backed with legislation
Domesticate key line materials and equipment
The 3 day conference of mainly Nigerian Technical people would examine the challenges from all aspects and proffer practical and cost effective solutions to the challenges in a graduated format, with time line and achievable milestones. This would then be followed by another 3 day conference to look at social, economic, legal, financial and environmental requirements, effect and implications of implementing the solutions proposed by the technical people. Pathway would then be created.
Paying Manitoba $7million yearly to manage our transmission network and technical partners (over $20m yearly, nationwide) to manage our DICOs and GENCOs is unnecessary drain on our scarce foreign reserve; as the involvement of these guys have not brought any significant improvement on our network.
We already have installed generating capacity in excess of 12,500MW, so we don’t need to start building new plants, but instead use the money available now to restore the recoverable plants and complete the ongoing plants, except where there are strategic advantages to be gained in building new generating plants.
As I earlier demonstrated, the DISCOs are two big to be effective, so they should be broken down into smaller units, starting from states. The legal implications and cost to government should be reviewed against the background of poor investment by all the successor companies against what they promised BPE in writing and because they bought the asset at less than 20% of the initial cost anyway. States who can afford it should be encourage to generate and supply electricity to their people.
New private companies should be given the task to collect tariffs instead of the DISCOs, which would put everyone in the value chain on their toes. This will immediately increase collection from the present 20% of the pre-privatization era.
As we have enumerated throughout this part of the discussion, finance is a major issue; that is even the main reason why the government privatized the NESI. So the government must work out a comprehensive financing scheme for the whole industry to help shore up investment that would help strengthen and stabilize the industry.
Legislation, finance and right environment needs to be created to allow off-grid renewable organizations to thrive; for example, to provide electricity to residential estates, industry, communities and such settlement that wish to diversify their sources of powe, whether or not they are within the grid connected areas.
Government using both carrot and stick should strategically force all the players in the NESI value chain to buy ONLY NIGERIAN products; after all we the professional bodies have domesticated all standards available to NIS for all Electrical materials. For the information of readers, we have many companies in Nigeria, producing Transformers, Feeder Pillars, Cross arm, Angle iron, Cables, Insulators and so on; so it is stupid not to patronize these organizations in favor of the foreign ones, whose malfunction cannot be penalized directly by us.
The feeder pillar I designed and built almost 30 years ago at Aba, for a factory, is still in service till today.
We hope this gets to some policy people who are desirous of moving our nation forward, as there are a lot of studies over the decades that have demonstrated a direct correlation between the Electricity availability per citizen to economic prosperity of a country.
I repeat once again that we have enough technical expertise in Nigeria to turn things around, given the right environment.
NEXT: This concludes for now, this section of EMS part 4. As promised, we shall move to PART 5, where we intend to discuss Building Services.
However, because we may start a relationship with a major player in this Industry from first quarter of 2017, we shall quickly discuss CABLES, to retain our independence of thought.
©Tunde Y. Salihu, 2016