Nigeria's electricity sector is rapidly going from bad to worse as power generation, which was hovering around 4,600 megawatts (MW) on May 29, last year, when President Bola Ahmed Tinubu assumed office, now stands at a meagre average of 3,000MW.
Nigeria's electricity sector is rapidly going from bad to worse as power generation, which was hovering around 4,600 megawatts on May 29, last year, when President Bola Ahmed Tinubu assumed office, now stands at a meagre average of 3,000MW.• Generation crashes as 36 states, FCT ration 2,994mw• Minister inherited current challenges, Elatuyi insists
Privatised about 10 years ago, it was expected that by now, over 40,000MW of electricity will be supplied to homes and industries, but the sector has remained in ruins as most electricity companies are already at the verge of bankruptcy. In the last seven months, Adelabu has not unveiled a single policy document; most of his pronouncements regarding license revocation, sales of gas in Nigeria, unbundling of the Transmission Company of Nigeria , focus on off-grid solutions, among others, always announced from Ibadan, the Oyo State capital, were not only accidental but also having a reactionary negative impact on the volatile market.
In 2023, out of the N700 billion accumulated from subsidy in the last seven months of the year, only N300 billion was paid. This year, the subsidy has moved to N2 trillion, which is about N167 billion monthly. Last week, the Federal Government paid $120 million out of the $1.3 billion indebtedness to gas companies for the supply of gas to run gas-fired power plants.
Ajibola, who admitted that the whole concept of DisCos and GenCos was poorly conceived, added that players have failed to live up to expectations either in terms of power generation, transmission or distribution.“Unless the entire template that gave birth to DisCos and GenCos is revisited, the parlous state of power generation and distribution may remain.
“With many government agencies owing electricity bills, the unsustainable subsidy on electricity tariff would only worsen the ever increasing market shortfall. So, if you ask me if leadership is the primary issue affecting the power sector, my answer would be yes. Kunle said the sector is failing both in leadership and management of all the critical stakeholders, stressing that retooling the entire industry structure, funding the industry gaps and decoupling the Nigerian Gas Company from Nigerian National Petroleum Company Limited for privatisation were critical steps that must be taken.
Professor Emeritus, Wunmi Iledare, who specialises in energy economics, said while it could be ill-advised to personalise the failure of the power institutions in Nigeria, the governance of institutions in the country were too individualised and personality focused. Energy market analyst, Lanre Elatuyi, said the situation of the market was not surprising because resource adequacy has been on a decline for the past few years as evidenced in the dwindled generation capacity mainly due to mechanical faults and feedstock.
According to him, the quickest intervention is for the government to clear the debts owed the GenCos so that they could carry out maintenance and also pay gas suppliers’ debts. The Edo State Governor, Mr. Godwin Obaseki, on Friday, flagged off the “Feed the Hungry” initiative, committing over N1b monthly to feed the poor and vulnerable residents of the state amid the hardship and suffering occasioned by the dire economic challenges.
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