July 21, 2024

DisCos may collapse in 3 years, as States break FG’s power sector monopoly- All On CEO

Solomon Ezeme

Dr. Wiebe Boer, All On outgoing, Chief Executive Officer, has revealed that the State Governments’ commitments to fully participate within the off-grid regulatory framework over the next five years will displace the Federal Government’s monopoly of the entire power sector, consequently collapsing the operations of the electricity distribution companies(DisCos) within the next three to five years.


Boer made this known on Monday, on Power Solution  (#PowerSolutions) radio show monitored by EnergyDay, featuring discussion on some of his insights on the obstacles to local solar system entrepreneurs especially as it relates with seeking capital and how All On is helping them bridge the gap.


The All On  CEO  made that position against the backdrop of the recently passed constitutional reform bill that permit states to supply electricity in their territories thereby breaking the monopoly of the Federal Government on the entire sector. This according to him  will address the many years of endless cycle of power failures in Nigeria.


Recall that the Nigerian-born Dutchman is planning to quit All On in the next few weeks to advance his career journey at Calvin University, Grand Rapids, Michigan , U.S.A. where he has been appointed as the 11th President of the institution, in March , 2022.


According to him, the since the Nigerian National Assembly has agreed to alter the provisions of the 1999 Nigerian constitution “to allow states generate, transmit and distribute electricity in areas covered by the national grid, the journey for the solution in the country power sector has commenced.


He said, “We have realised that with the legislation being put in place within the next three to five years, say by 2025, some of the existing electricity distribution companies(DisCos)  will be going bankrupt.


“We have seen that played out in the government’s take over of both Ibadan and Yola DisCos since they both became bankrupt at one time or the other.


“All the DisCos would definitely go bankrupt because their business model is not sustainable and the up-scale of the off-grid market model would overwhelm and displace them.


“Some would collapse while some of the successful off-grid emerging companies would take over operations of the generation and distribution system in the power sector after exit of the present players.


“Evidently, the off-grid power system is actually where the future of Nigeria electricity system is, but not the national grid system.


Boer further revealed that the inability of the on-grid electricity system to optimally address Nigeria’s power need, despite huge investment put into the entire framework, has persistently proven that it is the worst and unsustainable means of providing electricity for the citizens.


He said, “We realised this within the last 5 years at All On, that the national grid system can’t provide the lasting solutions to the country’s power sector.


“Private sector players operating within the off-grid space hold the key to the power solutions in Nigeria. They are doing off-grid system from batteries, coupling the inverters panels to providing the end to end operations in delivering power to average end users in a satisfactory manner.


While speaking on the topic: “Building a Sustainable Off-Grid Sector,” he recounted his experience in the last 5 years leading All On, revealing that the company has built an investment portfolio of almost 50 investee companies in the Nigerian renewable energy industry.


He also revealed that 40 out of the 50 companies funded by All On are fully-owned by Nigerians who are mostly young entrepreneurs, adding that the company has had an impact on the Nigerian renewable industry “in many ways”.


Boar said that the company has promoted young Nigerian entrepreneurs to the extent that young innovators are presently the ones leading the renewable space.