Rescuing Power Sector From Cartels

The recent experiences of Nigerians with reference to the erratic delivery of power supply, both for domestic and industrial uses, tend to portray the nation’s quest for stable electricity supply as an exercise in futility.

Nigerians are being held down in their hopes for adequate and uninterrupted power supply amid a system that continues to? collapse in spite of the billions of naira already pumped into the power sector.

Since successive administrations in the country failed to find lasting solution to the myriads of problems in the power sector, the nation automatically became a notorious leader in generator imports in Africa.

Statistics recently released by the Nigerian Customs Service (NCS) showed that Nigeria occupies the unenviable position of leading generator importer in the continent for the past 10 years, spending an average of $8 billion annually running generators of various sizes.

The billions of naira expended by the administration of former President Olusegun Obasanjo to resuscitate the power sector seem to have gone down the drain because the country at the expiration of his regime continued to maintain its candle-light economy.

As assuring, sound and realistic the promise by the late President Umaru Musa Yar’Adua’s administration to attain 6,000 megawatts of electricity supply by December 31, 2009 seemed to have been, it was never fulfilled.

Thus, the greatest challenge posed by the retrogressive trend said to be perpetrated by certain individuals who had constituted themselves into cartels in the sector in order to continue to milk the system is that virtually every household, as well as considerable number of corporate bodies and manufacturers now rely heavily on generators to ensure smooth business operations.

The erratic power supply apart from forcing many manufacturing companies to fold up,and laying off thousands of highly skilled workers has, also, compelled many companies to relocate to neighbouring countries where stable power supply is guaranteed.

Industry watchers had reasoned that a country that aspires to be among the first 20 leading economies of the world by the year 2020 but continues to treat its power sector with levity is not a serious country.

Afolabi Adedeji, a frontline facility manager, told LEADERSHIP that the country cannot have stable electricity supply as long as it allowed the importation of generators into the country, pointing out that the nation has been held to ransom by a powerful cartel who import? generators? and did? not want the reforms in the power sector to succeed.

He said? that the resolve of the government to allow those benefitting from the importation of generators at the expense of the nation’s economy to operate at will showed lack of political will on the part of the government to fight the cartel.

His views are not different from that of Lawrence Ovhuehor, a civil servant who told LEADERSHIP that there were insinuations in some quarters that very important personalities in the country were? behind the importation of generators? and as a result, have been frustrating government’s efforts to reform the sector.

He reasoned that if there was steady power supply, the use of generators would be reduced drastically, if not totally eliminated.

?“I have been to Ghana and Libya and never heard the sound of generators. If a sister country like Ghana who does not have the enormous resources we have could attain the enviable record of uninterrupted supply of electricity for 10 years, what stops our great country from even surpassing that feat?” he queried.

?Despite the glaring challenges aggravated by the recent drop in electricity generation drive in the country, the President Goodluck Jonathan-led administration has vowed to achieve the roadmap to power it unveiled two years ago.

The Minister for Power, Barth Nnaji, who confirmed the presence of? the? cartel in the sector to journalists, accused? them of sabotaging the efforts to improve power supply, emphasising that the reform had survived because of the political will of the President Goodluck Jonathan to pursue the agenda he hoped would ensure sustainable development in the country.

The minister explained that the challenges facing the power sector had been worsened by entrenched interests that were opposed to change, but added that the stage was already set for a change.

According to him:“They (entrenched interests) want things to remain the way they are, so that they will continue to get what they have been getting. This is what we are facing, but because of the will of the President, we have been moving forward.”

Nnaji, apologised to Nigerians for the erratic power situation in the country and urged them to exercise patience.He said government was working hard to address the challenge.

?“We are deeply concerned about the recent experiences of Nigerians with reference to the erratic delivery of power supply for domestic and industrial uses. The entire power sector finds it extremely important to express to Nigerians our deep regrets for this,” he said.

He listed the current challenges that worsened electricity supply in recent times to include inadequacy of gas, seasonal hydro-water shortages and to a lesser extent, inadequate human capacity and insufficient system synergy.

?He noted that with the emergency gas supply plan declared by the ministry of petroleum, there was sufficient guarantee of availability of gas to power the plants.

The minister assured that the stage was now set for a change, pointing out that, “We shall begin to see better days, months and unending years of stable power supply.

“We have the short term, medium term and long term solution to power supply in the country and the minister of petroleum resources is ready to collaborate with us to ensure that we receive adequate gas supply to our gas power plants.”

He affirmed that in the short term (which is in two to seven months) there would be moderately improved power supply and a renewed distribution level, operation of some new power generating plants, transmission lines and a more developed distribution pattern nationwide.

Interestingly, he assured that the medium term which covers? 2013 to 2015, would allow for the privatisation of the generating and distribution centres, adding that it would give higher efficiency and have input of high funding levels to increase power supply to Nigerians.

?“However, key to the citizens of Nigeria is the fact that the divestment plan by the Bureau of Public Enterprises, BPE, will be conducted in a transparent manner to give Nigeria and Nigerians the best investors in this sector,” he said.

Between 2015 to 2020 which is the period tailored for long term approach for power stability in the country, he said that there would be an increased diversification into renewable energy sources that would include small and medium hydropower, solar, bio-waste to energy, coal etc.

The minister who revealed that President Goodluck Jonathan, had received a report on how gas would be supplied under the one-year emergency plan, added that power generation had hit 4,400 megawatts at the beginning of this year, before it nose-dived.

Experts are of the opinion that for government to achieve its aims and objectives for the sector, certain issues that having been frustrating its efforts must be tackled.

One of such is the threat by workers of the Power Holding Company of Nigeria (PHCN) to government’s privatisation plans.

As far as the pundits are concerned, what government owes the PHCN workers are their outstanding salaries, benefits and pensions, including all severance benefits. It is not for workers to determine what happens to or obstruct the privatisation of the unbundled companies.

“It is the government’s abject acquiescence to the workers’ demands and the confusing move of the government that fuels the workers’ arrogant opposition to the implementation of the Act and the roadmap.”

The experts in their submissions, counseled that such recalcitrant?? workers bent on frustrating government’s efforts, should be firmly resisted.

Since the Presidency has set aside N130 billion for the retirement benefits for the workers, the next step they suggested,? would be? for the government to stand firm and accelerate its privatisation plan.

Rather than resort to using the trick of assuring workers of their jobs in a? post-privatisation era in the sector , popular opinion has it that these? workers must be told in no uncertain terms that they should be ready to embrace the reform and face the decision of the new buyers of the plants.

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