Power: Are we really serious about it? by Lateef Adewole

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DisCos agree 2 months free electricity for Nigerians

The Insight by Lateef Adewole

Sometimes in February this year, there was a viral photo of a little girl, Dele, who was using the light from a bank’s ATM gallery along Yaba road, in Ondo, to do her school assignment. She is a primary school student of Hope of Glory Academy, Ondo. There are many other pictures online of university students reading under the street lights. What quality of education is expected from such students?

Dele’s case is just one instance out of myraid of other situations where lack of electricity has made life unbearable. Is it at the hospitals, offices, homes, etc.? What about companies, factories and industries? Many of them have packed up, thrown their workers to labour market, and relocate to other neighbouring countries where there is relatively stable power supply. The root cause of our problems is majorly power instability. This has led to poor economic conditions, slow developments, poor standard of living, insecurity and so on.

The above underscore the importance of having stable power supply in the country. Sadly, as of today, Nigeria with a population of 200 million people still battles with 3000 to 4000 megawatt of power after 60 years of independence. This is the “giant” of Africa. Whereas, those who are “less giants” like South Africa with a population of 58 million (29% that of Nigeria), now has about 51,309MW. This is 1,282.7% of Nigeria’s 4000MW. Ghana, with 29.7 million people (15% of Nigeria), produces about the same power as Nigeria’s 4000MW.

Let us not go to the advanced countries like China, USA, UK, Canada, and the rest. They are incomparable. Over the years, Nigeria has not invested proportionally in power as the population exploded. For decades, the many power infrastructures remained dilapidated, especially as it was bogged down with corruption, like every other thing in Nigeria. It was on the exclusive list until 2013. Before then, only the federal government had the constitutional mandate to provide electricity for the whole country. The Electricity Corporation of Nigeria (ECN) transitioned to National Electric Power Authority (NEPA) in 1970, which monopolised the sector.

The global standard is 1000MW to 1 million people. If we have to go by that, the country is supposed to be producing 200,000MW by now but here we are. At best, the total installed capacity of all GenCos in Nigeria today is 12,522MW. Only about 7,141MW of this is available, while actual production is about 4000MW. The transmission segment cannot wheel more than 5000MW at optimum, despite the installed capacity of 7000MW. The distribution segment run by the DisCos, distribute between 3000 and 4000MW. The highest ever in the history of Nigeria was 5,122MW.

President Muhammadu Buhari urged to probe N16 trillion spent on power by previous administrations
President Muhammadu Buhari urged to probe N16 trillion spent on power by previous administrations

With statistics like these, how do we expect to have uninterrupted power in our homes, offices, schools, hospitals, industries, and so on?

I have attended many conferences of Nigeria Society of Engineers (NSE), the COREN Assemblies and the Nigerian Institute of Electrical and Electronic Engineers (NIEEE) for some years. Every time they ended, I was always left with sour tastes in my mouth and a heavy heart. Why? This was because, I always saw how Nigeria is so endowed with numerous, exceptionally brilliant Engineers in many fields, including power, both from the academics and the industry, within the country, not to talk of Diaspora. I kept wondering what Nigeria’s problem was.

The effort to change this narrative culminated in the privatisation of the power sector after what seemed like eternity. The process was frustrated for decades. But the successful deregulation in the communication sector gave the federal government the needed fillip to pursue it. Even the obiquitous Obasanjo could not solve the power problem. He initiated National Integrated Power Project (NIPP), where he spent an humongous 16 billion dollars! What was done with such huge amount still remains a mystery. Many times, one wonders why cost of projects in Nigeria are always in multiple of the cost of similar projects in other countries.

It was former President Jonathan, who, against all odds, successfully privatised the power sector. Despite all the anomalies that encumbered the process, the government was able to break the monopoly of PHCN, as NEPA was later called. The distribution was privatised with government still having 40% equity and broken into 11 companies called DisCos. Transmission is wholly owned by Nigeria but privately managed by Manitoba Hydro International. Generation was broken into 6 completely owned by private companies (GenCos). That privatisation has been a subject of criticism and controversy since the new administration came on board in 2015.

One issue that has remained recurrent is the tariff. The discos were expected to run a Multi-Year Tariff Order (MYTO), which would have seen them regularly increased the tariffs based on cost-reflective model. This was to enable them recover their investments. This was also predicated on certain things which both parties must do. The discos were expected to reduce the technical and commercial losses substantially, invest in infrastructures to be able to take the generated power and distribute efficiently to the final consumers. Also, they were supposed to meter all consumers. Their failure to do so compelled the government to transfer that responsibility to separate organisations; Meter Asset Providers (MAP).

DisCos planned to increase electricity tariff on July 1
DisCos planned to increase electricity tariff on July 1

However, all these are still a mirage. The discos prefer estimated billing. The cumbersome process of getting the meter and the attendant cost discouraged many from getting them. This gave discos the opportunity to continue to arbitrarily increase the estimated bills given to consumers, even when they do not have power. There is so much irregularities that major issues with the citizens are about excessive billings.

Still, there was the plan to increase the tariff by this week, Wednesday 1st of July. It took the intervention of the national assembly leadership to suspend it for now. While it was agreed that there is need for it, they premised their position on the citizens’ financial difficulties due to coronavirus and that discos need to ensure that the consumers are metered before any increase. How sustainable that position is remained to be seen. This is because, the increment was sanctioned by the regulatory body, National Electricity Regulatory Commission (NERC). It was supposed to be a “service reflective tariff” rates, which to me was sensible. Consumers are to be charged at rates reflective of how many hours of electricity they enjoy per day. That has been suspended for now.

But, are we really serious about getting stable power supply? Our attitudes and dispositions to the sector show negative affirmation. When I look at the industry, all stakeholders do not exhibit seriousness and sincerity of purpose. It is like everyone is simply out for what they could grab. Unfortunately, this is costing Nigeria from all angles.

Apart from the lack of economic development it caused, the burdensome finacial wastages as a result is enormous. It was reported that this administration has spent over 1.3 trillion naira (4.26 billion dollars) on the power sector in the past 5 years. That’s different from the Obasanjo’s 16 billion dollars majorly down the drain. Where is the power? The system is enmeshed in corruption. From the privatisation, which gave the power assets to political cronies, many of whom do not have the financial muscle to invest the kind of money requires to revamp the sector and or technical competence to manage the system.

Also, failure on the part of government to fulfil their end of the bargain, particularly to the discos, did hamper their performances and gave them alibi for their own irresponsibilities and failures.

Former Nigeria President Goodluck Jonathan privatised the power sector
Former Nigeria President Goodluck Jonathan privatised the power sector

Many of those who bought the power assets might have done so with the mindset of the telecommunications privatisation that became money spinners. Unfortunately, the terrains are not the same. The technology requires to deliver power is more cumbersome, tedious, complicated, more risky, takes longer time before maturity, and with less security and control, unlike telecommunications.

So, many of them could have been disappointed and frustrated, resulting in transfer of such “aggression” to the final consumers by their “crazy” estimated billings. The reductions in technical and commercial losses promised are yet to be seen. They have also not been investing adequately in the sector. In many areas, the consumers still buy their transformers, conductors and cables, pay for installations, maintenance and repairs, and so on. What are they collecting money for then?

The NERC which was established by the Electric Power Reform Act of 2005 has remained a “toothless bulldog”. The power companies do not respect them. How will that even be, when they were said to benefit from discos directly or indirectly. “T’enu ba je dodo, enu o ni s’ododo mo” (when people are compromised, they will not be able to speak the truth again). On countless occasions, NERC issued directives to the discos who simply observed them more in breach. Things like: no meter no pay, no disconnection without notice, apologies for power interruptions by discos, and many others. They are only on paper. Not enforced.

What about the citizens themselves? Do we really need power stability? Many of our actions speak to the contrary. Let me start with the worst part; energy theft. This remains the biggest problem in the power sector. Many Nigerians use light they do not pay for. There are people who are not on the register of any disco at all. They just connect their houses or factories to the grid and continue to use power without paying. Many of those who have meters (prepaid or post-paid), simply bypass them. They steal from the discos. They steal from all of us because, some people will have to pay for it through those estimated billings.

What about vandalisation? One of the public (now private) assets most susceptible to vandalism are power infrastructures. The citizens do not take ownership of properties in their communities, making them vulnerable to theft. Overhead conductors, armoured cables, and even step down transformers can be stolen. There were cases where parts of the transmission lines conductors and towers were stolen. It was incredible.

Nigerians love free things. But even in Freetown, there is no free lunch! We like to push the minutest of responsibilities to government. So, many do not feel obligated to pay for the power they consume, thereby resulting in piling up of their electricity bills. These are parts of the burden which discos bear. How can any business survive when customers refused to pay for goods consumed or services rendered to them? That’s why discos also deploy the “agbero-style” in their collection approaches. Afterall, we are all Nigerians. We can all chose to be “mad”.

In all of these, there is need for introspection by all of us from top to down. We need to ask ourselves if we sincerely desire a stable power supply or not. If so, then, our attitudes must change. With such consensus, all that look like gigantic problems and seem insurmontable will simply begin to fall in place.

Import duties of 10-15% on imported chips by local meter manufacturers and 35% on wholly imported meters need to be addressed if we want all customers to be metered. The meters should be given free or allow the customers to pay for it as they vend over time. It should also be transferable from one location to another, just like phones. Adequate gas feed to the power plants should be ensured by the government.

Many off grid solar power which was started should be expanded further. It’s being done for some markets and schools now by FG. Lagos State government also deployed it to power about 172 schools and 11 clinics totalling about 5MW. This is different from their IPP used to power many state infrastructures and communities. Other states can replicate that. Off-grid captive power should be encouraged. Transmission system needs upgrade. Capacity expansion is critical to evacuate whatever GenCos can produce. Increasing generation capacity without this will amount to a waste.

DisCos should invest more on their infrastructures. The situation where they reject power from TCN while Nigerians are still without stable power is appalling. It is unacceptable. Old transformers, weak high tension and low tension lines, bad cables, etc, need to be replaced. They should also improve on their collections by checking and monitoring many of their unscrupulous staff who prefer to take bribes from customers who refused to pay or stealing power.

Citizens must also be responsible and responsive. They should pay their bills as and when due. They should protect power assets within their communities. Individuals can also help themselves by going solar. This may look costly at initial stage but extremely cheap in the long run. I know because I have been on that for 8 years. I have not run my generator for over 3 years now and enjoyed 24/7 electricity round the year, despite having poor public power supply to my community from the DisCo.

If every stakeholder does their parts, fresh life will be breathed into the sector, the system will be reenergised and will kick-start the much desired revolutionary developments in all sectors of our economy and lives. With such, Nigeria can begin to occupy its rightful place in the comity of nations. And become the country we can all be proud of once again!

But, are we ready?

May God continue to protect us and guide us aright.

God Bless Nigeria.

Lateef Adewole is a political analyst and social commentator can be reached by email [email protected] or via WhatsApp +2348020989095 and @lateef_adewole on Twitter