CEM REPORT | The Nigerian Institute of Power Engineers have once again excavated the numerous challenges facing the Nigerian power sector which has perpetually kept the sector under abysmal provision of electricity for Nigerians
While some of the challenges are not entirely new to the hearing of Nigerians, the Institute has gone further to outline some profound milestone solutions capable of effecting a turnaround of the sector in the short term and medium to long term, if the government would yield to it.
These are contained in a press statement from NIPE released Wednesday after a long deliberations at an emergency Power Symposium sent to Continental Economy Magazine
The press statement signed by the President of the Institute, Engr. Israel Abraham cast the reason for the symposium on the recent total collapse of the entire system experienced in February which was attributed to failures of supply chain and equipment at the entire network.
“Since February 2022, Nigeria has been going through an unprecedented power supply crisis. Several reasons have been adduced as the causes premised along the power value chain; these include failures of gasfuel supply to Generation Companies, failures at power stations at the Generation Companies (GenCos), failures of the National grid managed by Transmission Company of Nigeria (TCN), and failures with the networks of Distribution Companies (DisCos), amongst other issues such as political interference and regulatory flip flops.” The statement reads.
Amongst the numerous challenges facing the sector, Equipment failure, dependence on foreign companies for equipment supply now being confronted by shortage of forex, use of non-power professionals to manage the sector, weak regulation and undue interference by the government stand out
NIPE therefore outlined far reaching solutions bordering on synergy among stakeholders and operators in the power chain to ensure free flow of inputs such as gas, concessions on forex to facilitate timely import of equipment and unbundling of Transmission Company of Nigeria (TCN) to boost efficiency at the power transmission.
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On the short term, the following are some of the proffered solutions
NIPE says National Integrated Expansion and Maintenance Planning Coordination Centre (NIEMPCC) should be created for Power Generation Plants and Gas Suppliers nationwide. This will ensure that a minimum level of power is available on the grid at all times. In accordance with the Grid Code, the System Operator, under the supervision of the Regulator should be mandated to co-ordinate GenCos and TCN expansion and maintenance program to ensure that there is a time during the year minimum of say 6,000MW of Generated power and TCN wheeling capacity.
NIPE also said, “DisCos should be mandated by the existing Regulation(s) from NERC to invest in critical distribution and transmission networks while urging them to develop a more scientific Revenue Collection Strategy to improve the liquidity in the power value chain.
[Download full statement here ]
“NERC should develop a more scientific approach/model for Estimated Billing. More tariff methodologies or an updated version of MYTO should be made available by NERC to take care of the reality of Nigeria’s financial and economic conditions.
“Power Professionals with management training or cognate exposure should be deployed to head all power-related Ministries, Departments, Agencies and organisations, both public and private. Professionalism should be promoted across the power sector value chain to engender a sector that is business-focused.
“Govt should accelerate the implementation of the Siemens Project, engage more seasoned Power Engineers in its implementation and shield it from undue political interference as prevailing.
On the medium to long term, NIPE outlined the following as some lasting solutions;
“There is a need to break up TCN to allow independence of the Independent System Operator (ISO) and the Independent Market Operator (IMO) for more effective and efficient management of the NESI. The unbundling exercise will thus require a massive funding mechanism by the FGN to support the TCN in bringing this about, and this should be considered a priority by the FGN.
“There is need to renegotiate the DisCos Franchise Areas to more manageable sizes. State by state basis for franchising is recommended. This will increase efficiency in power supply as each company will have enough funds to adequately invest to meet needs while the host state will find it economically convenient to partner as an investor with a dedicated DISCO to make life better for its citizens
“The power sector should be given a 5-year foreign exchange concession to procure equipment and materials while simultaneously but deliberating tasking, through incentives, indigenous power engineering professionals and manufacturers/Investors to build capacity needed to produce all equipment and spares required to get the sector sustainable.
[Download full statement here ]
