Segun Atanda/
It may sound like a chicken or the egg causality dilemma, but the Minister of Power, Works and Housing, Mr Babatunde Fashola believes Industrialisation is a major factor in the level of power supply.
Fashola, who spoke midweek in Abuja at an Engagement Workshop on the Power Sector Recovery Programme (PSRP) for Civil Society Organizations organized by the Ministry of Power Works and Housing in conjunction with the Power Sector Communications Team (PSRP), said as a nation Nigeria had taken great strides in the area of development and had the potential to compete favourably with other developed and emerging economies if the citizenry collectively resolved to tackle identifiable challenges.
Responding to questions during the interactive session of the Workshop, Fashola frowned at the penchant of some Nigerians to put the country down in comparison with other countries, in and outside Africa, especially in power production. He explained that the power that any country needed was not only a function of its population but also a function of the level of its development and industrialization.
“Nigeria is a great country, let’s stop putting ourselves down,” Fashola said as he analysed the challenges of power supply in Nigeria and revealed what the Federal Government has done to improve the situation.
The Minister, who took time to explain and respond to questions alluding to the quantum of power available in South Africa and the report that Germany was exporting power, said the power need of a country, also depended on the nature of its economy. He stressed that research and invention driven economies would always require more power, and that South Africa, whose economy largely depends on mining, consumes a lot of power.
He added that with the Federal Government now paying attention to real growth through economic diversification as seen in the development of mining and others, the nation’s Power Sector is being prepared to support such growth.
“We have left mining. We are now in oil and gas. Dr. Fayemi in the Ministry of Mines and Steel is just trying to reset us back. We are trying to support their mining power demands whenever they are ready,” he said, adding that in comparing Nigeria with a country like South Africa, one must take into cognizance that while Nigeria is largely a trading economy, South Africa is already producing nuclear energy, aircraft and military hardware, using more power.
Describing such analogies as out of place, Fashola cited Ashaka Cement industry in Gombe State explaining that as an industrial town, it only utilizes 15 Megawatts of electricity, and that there are not many industrial towns of that type in the country at the moment.
In terms of population as a function of energy need of a country, the Minister said, “Niger is running on 80MW, Republic of Togo 200MW less than Abuja, Ghana is about 3,000MW installed capacity and they are not producing all of that; Lagos alone is getting 1200MW; one state, half of another country. So we must understand the dynamics of electricity use.”
Referring, particularly to a comment by a participant that Germany is exporting Power, Fashola said, “Your country is exporting power too, to Niger, to Republic of Benin, to Togo and we are selling Gas to the West African sub-region.”
Advocating a collective resolve to solving the nation’s challenges, Fashola noted that power is a central contributory factor to a nation’s industrial competitiveness.
“Again, if you read the Economic Recovery and Growth Plan and you read the Power Sector Recovery Programme, when they tell you there are no plans to solve these problems, tell them it is a lie, that they don’t know what they are saying and that there are action points here to deal with the problems.”
The Minister reiterated the Federal Government’s commitment to the full implementation of the Power Sector Recovery programme (PRSP) as means of solving the seeming intractable challenges in the nation’s Power Sector. He said that the commitment could not be doubted because it was encapsulated in the government’s Economic Recovery and Growth Plan (ERGP) where Power forms one of the five major pillars.
According to the Minister, one of the five areas of imminent and immediate activity in the ERGP is the provision of Power, access to Power and delivery of Power. He described the PSRP as one of the vehicles for communicating what was being done in the Sector, monitoring and measuring how well they were being done as well as understanding the challenges being faced in the Sector.
Recommending that all Nigerians read the Power Sector Reform Act to have a better understanding of issues in the Sector, Fashola, who assured that the government had identified and signed on to solving all the problems of the sector, added, “If you don’t understand what we are saying and why we are saying it, it will be difficult to really appreciate where we even make progress.”
He said that the intention behind the PSRP was “to bring it to street level so that in whatever area of the country you are, if you come across this document, you will be able to read it, understand it and make sense out of it, and ultimately use it to measure what we are doing”.
He added that the document, when finalized, would be translated into the three major Nigerian languages for a start.
He said PSRP had been articulated to address all the known and frequently asked questions in the power sector such as, from the generation side, why all of the produced Power could not be sold, or the demand for increase in tariff by DisCos and counter demand from consumers for meters, the demand from the Nigerian Bulk Electricity Trader (NBET) for debt settlement or issues of damaged or dysfunctional equipment, high voltage and low voltage among other problems in the sector.
Defining the PSRP as “everything that is troubling power,” Fashola said, “Today and even in the future, if any new problems come up, we will amend it, a new version and put it inside.”
Fashola added that in articulating the programme, Government did not rely on its experience alone but circulated the document to Parliament for the views of the representatives of the people, to labour, the Manufacturers Association of Nigeria (MAN), the Supreme Council on Islamic Affairs (SCIA) and the Christian Association of Nigeria (CAN) as well as other stakeholders.
The Minister, who noted that the wide circulation of the document was in order to take vital inputs, pointed out that the programme was not about what would happen tomorrow but what was already being done such as Liquidity issues, payment of debts, adding that the Federal Government had identified its debts, verified it and had asked the DisCos to follow up with the state and local governments to recover their remaining debts.
In the case of Metering, he recalled a judgment that was given against the Federal Government under a metering arrangement in 2003 that ended up in court, adding that as a result of the intervention of the Ministry, the Federal Government of Nigeria was saved from a judgment liability of N119Billion.
According to him, the part of the contract sum trapped in a bank as a result of protracted litigation has now been converted into a credit scheme to supply meters and government is now waiting for regulations from the Nigerian Electricity Regulatory Agency (NERC) while the plaintiff in the court case is in the position of funding to the tune of N39 Billion that could go into meter supply. He explained that NERC was also dealing with issues concerning tariff which is their statutory responsibility.
Listing other initiatives of the Federal Government under President Muhammadu Buhari to solve the problems in the power sector to include making provision “for issues of tomorrow” in the Medium Term Expenditure Framework – the National Development Plan, presentation of a 20-Year Transmission Expansion Plan and the approval by the Federal Executive Council of the Distribution Expansion Programme framework to address the unutilized 2,000MW of power, Fashola debunked the notion from some quarters that there is no infrastructure plan for power in Nigeria.
“Again, if you read the Economic Recovery and Growth Plan and you read the Power Sector Recovery Programme, when they tell you there are no plans to solve these problems, tell them it is a lie, that they don’t know what they are saying and that there are action points here to deal with the problems,” the Minister said. “Really and truly, if you get a grip of what all of these things are, you will be able to measure what we have done.”
Responding to questions arising from the interactive session that followed his remarks, Fashola explained that any attempt to invest in the Power Sector without following the established regulations to ensure safety and standard was an effort in futility in reference to the issue raised by one of the participants that his community purchased transformers and cables in expectation of getting connected and being compensated or reimbursed.
The Minister also explained the delay in the 14 Solar Developers making appreciable investment moves months after the signing of Power Purchase Agreements with them. He said that aside the fact that they insisted on another agreement called Put Call Option Agreement (PCOA) which would guarantee them payment if the contract failed, the companies demanded that they be issued the documents in Dollars at a time when the country’s economy was in recession.
Earlier, while making a presentation on the Power Sector Recovery Programme, the Project Manager of the PSRP Implementation Monitoring Team, Mr. Kenny Anuwe, said the PSRP was designed to enhance the achievement of the Federal Government’s Roadmap of Incremental, Steady and Uninterrupted Power with its other deliverables like improvement in sector governance, meter supply, Eligible Customer and Mini-grid Regulations.
Comprising of series of policy actions, operational, governance and financial interventions to be implemented by the Federal Government over the next five years to restore financial stability, improve transparency and service delivery, among others, the PSRP is aimed at resetting the Electricity Supply Industry for future growth.
According to the Executive Summary and Fact Sheet made available to participants at the Workshop, the PSRP, developed in collaboration with the World Bank Group, comprises of components and reform actions in four groups of interventions including financial intervention to fully fund historical and future sector deficits, operational/technical interventions, governance interventions and policy interventions among others.
Also present at the occasion, which took place at the Auditorium of the Ministry, were the Minister of State for Power, Hon. Mustapha Baba Shehuri, the Commissioner of NERC in charge of Consumer Affairs, Dr Moses Arigu, Managing Director of the Nigerian Electricity Management Service Agency (NEMSA) and Chief Electrical Inspector of the Federation, Engr. Peter Ewesor, top officials of other Power Sector regulatory agencies, members of the Civil Society Organizations relating to Power, top officials of the Power, Works and Housing Ministry, members of the PSCT and representatives of the Organized Private Sector among others.
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