No quick fixes to Nigeria’s electricity problem- Pedro Omontuemhen, PwC Nigeria Energy leader cautions top presidential aspirants
Pedro Omontuemhen, Energy, Utilities & Resources Leader, PricewaterhouseCoopers, PwC Nigeria, in this special chat with EnergyDay Nigeria, during the 13th edition of PwC’s Annual Power & Utilities Roundtable themed ‘Setting a New Power Agenda Post-2023 Elections’, cautioned top presidential contenders in the 2023 presidential election against thinking that there are no quick fixes to Nigeria’s electricity crisis. He also recommends an interactive session between the aspirants and major stakeholders in the power sector, to expound their plans and programmes for recovery of the power sector.
What is your view about the power programmes of the Presidential aspirants?
The next administration, whether right, left and middle, or a combination of all the three, must set a serious power sector programme, capable of guaranteeing adequate, sustainable, and appropriate electricity to all Nigerians. PwC Nigeria has, therefore, mobilised stakeholders within the power sector to review some of the promises made by the Presidential aspirants, with the clear agenda of properly helping them situate the real issues affecting the power sector. There is no better time to do this than now. It is not too late to set the agenda for them having identified some weaknesses in all their manifestos.
We have therefore realised that the various segments of the industry including generation, transmission, distribution, gas supply to the power plants, and alternative energy sources are facing serious challenges. It is not realistic to promise 24/7 in less than four years for all Nigerians, the solution has to be incremental over time.
Whoever wins the 2023 Presidential Election should not focus on one, but concentrate on the entire value chain. The incoming administration must come up with solutions that would guarantee sustainable and reliable power supply to every Nigerian.
Apparently, there are no quick fixes to addressing the critical issues facing Nigeria’s power. The right thing must be properly done. It would surely take time and we need to be consistent in our approach.
We need to take up the challenges from the previous administration, irrespective of the years it has taken them to achieve the little gains, whether four or eight years. The Government of the day must be consistent by sustaining the right policies of the previous administration, with a commitment to meeting the yearnings of Nigerians, concerning the power sector.
What can be done to address the negative impact of vested interest in the Nigerian power sector?
No Government has the capacity to completely stop the influence of vested interest in critical segment of the economy. What the President or Minister of Power should do is to rise above the interest of the few, by focusing on the interest of the majority of the citizens. Of course, there would be vested interests, a responsible administration will identify those with genuine interests and ensure that those interests align with the general interest of the country.
How has the privatisation of the power sector fared in the last nine years?
In one way or the other, we have made significant progress in the power sector. One of such is the listing of Geregu Power Plc into the Nigerian Exchange Limited, NGX, the first Genco to be listed on the NGX Main Board. A lot of investors have invested in the power company due to its demonstrable records of accomplishments.
Azura independent power plant (IPP) is another success story of the power sector reform. Mainstream the manager of Kainji dam is making a significant impact in the entire value chain. The company is selling power to the Republic of Benin, Togo and Niger Republic. There are other success stories across the wide spectrum of the power sector value-chain. The Generation companies have achieved more success than distribution companies, DisCos. Some of the distribution companies have failed in their mandates.
Are you suggesting a complete reform of the DisCos?
No really. To fully deal with the problems associated with the distribution company, we need to first understand what the real issues are. Part of the problem is that owners of the DisCos acquired the assets with the thinking that it was going to be another juicy investment like the telecom success. Most of them do not have sufficient resources to mobilise fund to finance the distribution infrastructure. Without proper investment, there can’t be adequate returns. Although, some of the eleven DisCos have been more successful than others, and that is responsible for the Government’s takeover of the DisCos struggling to meet minimum standard.
What role can the State Governments play in addressing some of the challenges facing the power sector?
The State Governments should be allowed to participate effectively in the Nigeria Electricity Supply Industry(NESI) by coming up with the strict legislations against power theft and vandalism. We can’t continue to bash the DisCos for not collecting enough, while the big men and public servants keep stealing power. Although there are established laws in the electricity reform act already, the law is still very mild on criminals stealing power. Most Nigerians don’t take stealing of electricity as a serious issue, as far as they are concerned, it is ordinary tapping. Some of them have this feeling that electricity is their share of the national cake.
This is where the intervention of the state’s is mostly needed. The State Government who also have sufficient resources can also invest in embedded power to augment supply to the underserved parts of the state. The state can also collaborate in the area of buying prepaid meters for the citizens. The next administration should be looking at how to make state Governments major stakeholders in the power sector.
What is your assessment of the green alternative power sources ?
The Federal Government has invested a lot in the renewable industry and the success stories are there to be seen. Solar power in rural areas has proven to be a reliable source of energy solutions to millions of underserved Nigerians. It is expensive to install transmission and distribution networks in these areas. The Discos are struggling to improve revenue collection in those areas because of the distance between these communities and the city centers where the headquarters of the DisCos.
The Nigeria Rural Electrification Agency (REA) has increased electricity access to unserved and underserved Nigerians in the Northern part of the country. Through the efforts of the REA and the private sector, some people in the North now have access to electricity for the first time through the solar home solutions. The next government must therefore mobilise private sectors’ funds into these areas.
Available data from the developers of solar home solutions and the REA in some of the states have shown that people in rural communities are willing to pay for power because it is digitally controlled. since it is paid as you use it. The rural dwellers understand why they should switch off their appliances when they are not in use.