Nigeria may never have stable power supply if there is no appropriate tariff across the Gas to Power value chain. This is because not paying an appropriate tariff in any of the value chains would affect all the systems from the gas producers to the power distributor, and this will continue to lead to inadequate supply of gas to the power sector.
An official of the Ministry of Petroleum Resources who spoke with BDSUNDAY said that it would be in the best interest of all stakeholders, especially consumers and the government to ensure power supply is stable and accessible by everyone in the country to address the issue of reflective tariff in the power sector and stop the blame game between power operators and gas supply/producers over payment for what is supplied.
He said that there is enough gas for the country to meet its power need and jump-start its economic activities but there must be enough incentives for investors to participate in the development of the Gas to Power value chain.
He said gas is available judging from the current reserves that the country is having. He however, said there is no gas for anyone now because there are no enough incentives for investors to look for a new sources of gas.
Meanwhile, Nigeria’s gas reserve has hit 200.79 trillion standard Cubic feet (scf), one year ahead of its planned target. This is about five trillion higher than what was obtained in 2018.
However, infrastructural challenge is preventing her having the full benefits of this resource as many of the potential consumers cannot get it for use.
Oil and Gas industry sources which confirmed this stated that the Federal Government has actually planned to achieve this figure by 2020.
The country’s reserve has for many years hovering around 186 trillion standard cubic feet of gas with most of it coming from associated gas.
The sources said the increase is as a result of recent encouragement and policy directives rolled out by the government which are aimed increasing the nation’s gas reserve for the purpose of boosting her economy.
They said the potential for gas growth in the country is very high provided there is enabling environment for investors to operate.
The country currently produces 8 billion SCF of gas domestically with 3.5billion of this going for LNG and 1.5billion for domestic market.
Nigeria’s gas sector has proven to have the potential of been a key player in the emergent global natural gas market. There have been different development concepts and solutions for the effective exploitation and utilisation of this abundant natural gas reserve of which some of this gas reserves are termed ‘stranded’. Economics and profitability of new and existing industrial gas projects been considered to increase gas utilisation with hope of solving the energy crisis in the country.
Effective utilisation and monetisation of the nation’s ‘stranded’ gas reserves has the tendency of solving the energy crisis in the country.
Experts, DisCos Nigeria’s external debt rises to N25.7trn
Despite spending N1.5trillion on the country’s power sector in the last two years, the Federal Government yesterday said it is in the process of investing a fresh $3 billion (N915bn) World Bank loan into the sector.
The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, disclosed this during an interview with journalists on the sidelines of the World Bank/International Monetary Fund (IMF) meetings holding in Washington DC, United States.
Vice President Yemi Osinbajo had in September said the federal government invested about N1.5 trillion in intervention fund in the Nigeria’s power sector in the last two years. Osinbajo said this at a power sector roundtable hosted by Mainstream Energy Solutions Limited (MESL) at its Kainji Hydropower Plant in Niger State last month. The Vice President, who was represented by the Minister of Power, Sale Mamman, said “the Federal Executive Council (FEC) approved the third round of intervention funding for the sector, with a total of about N1.5 trillion in the last two years.
But yesterday in Washington DC, the Finance Minister said she would be holding further discussions with the management of the World Bank to explain how the fresh $3.5bn loan it is seeking would be disbursed for the country’s power project. She said based on the plan of the Federal Government for the power sector, the loan would be used for the development of transmission and distribution networks to enhance the delivery of electricity. The minister also said the loan would be used in addressing some of the challenges that the country is currently facing in the power sector.
She said, “There is a proposed $2.5bn to $3bn facility for the power sector development programme in Nigeria and this will include development of the transmission and distribution networks as well as removing the challenges that we currently have now in the electricity sector. “We are going to have a full meeting to discuss the power sector recovery programme and back home we have been working a great deal with the World Bank to design how this programme will be implemented.
“So we have an opportunity now to have a direct meeting with the leadership of the bank and to tell them the plan we have and how much we need from one to five years.” The minister disclosed that the government would be disbursing the $3bn facility in two tranches of $1.5bn each. When asked to comment on concerns being raised by the IMF about Nigeria’s debt which stands at N25.7tn, the finance minister said, ‘‘Nigeria does not have a debt problem.’’
She said what the government needed to do is to increase its revenue-generating capacity in order to boost the revenue to about 50 per cent of Gross Domestic Product. She said with Nigeria’s current revenue to GDP ratio standing at just 19 per cent, its underperformance is significantly straining the government’s ability to service its debt obligation. The minister said, “Nigeria does not have a debt problem. What we have is a revenue problem. “Our revenue to GDP is still one of the lowest among countries that are comparable to us. It’s about 19 per cent of GDP and what the World Bank and IMF recommended is about 50 per cent of GDP for countries that are our size.
We are not there yet. What we have is a revenue problem. “The underperformance of our revenue is causing a significant strain in our ability to service debt and to service government day-to-day recurrent expenditure and that is why all the work we are doing at the ministry of finance is concentrating on driving the increase in revenue.’’
FG got N1.2trn for power sector projects between 2015 and now
An analysis by Daily Trust has shown that the federal government took steps to borrow $3.311 billion (about N900bn) externally since 2015 to finance power sector projects.
The analysis of external funding for the Transmission Company of Nigeria (TCN) being the sole public utility in the power sector value chain indicates that the Company sought loans and grants to raise the transmission wheeling capacity from 8,100 megawatts (MW) to 20,000MW. TCN is obtaining $1.661bn (N601.3bn) multilateral loans from five agencies which it said, it is using for the procurement and installation of projects under its Transmission Rehabilitation and Expansion Programme (TREP).
The breakdown of the fund obtained by this paper indicates that the World Bank is the highest donor with $486m for a fresh Nigeria Electricity Transmission Project (NETAP), and $27m for transmission project tagged, North Core. The African Development Bank (AfDB) gave $410m loan for transmission expansion projects; the French Development Agency -AFD and European Union (EU) gave $330m for the northern corridor transmission project.
While the Japanese International Corporation Agency pegged $238m for Lagos/Ogun transmission project, AFD gave another N170m for the Abuja transmission ring scheme. Between 2017 and 2018, the federal government collected a $1 billion (about N362bn) Performance Based Loan from the World Bank to fix the power sector in what it called the Power Sector Recovery Programme (PSRP).
The World Bank is also processing another $350 million (N127bn) loan for the Rural Electrification Agency (REA). The Central Bank of Nigeria (CBN) in May also announced the disbursement of N120.2bn to different electricity distribution companies (DISCOs), power generating companies (GENCOs), service providers and gas companies, in order to address the liquidity and funding challenges facing the power sector.
Power firms express dissatisfaction
But the power Distribution Companies (DisCos) had recently reacted to the borrowing by TCN which it said is not yielding results in the sector.
In a statement by the Executive Director, Research and Advocacy of the Association of Nigerian Electricity Distributors (ANED), Chief Sunday Oduntan said even with the TCN multilateral funding, its poor equipment caused over 100 electricity grid collapses since privatization in 2013, and nine collapses this year. ANED said TCN analogue system caused 5,311 interface disruptions in a single DisCo within 18 days of September 2019 and that it was despite the $1.6 billion investment TCN said it has made.
The DisCos which said they have invested $1.4 billion in their networks, said despite TCN saying it is implementing a Transmission Rehabilitation Expansion Programme (TREP) with the $1.6bn fund, “the reality is otherwise. TCN finds it difficult to move away from analogue-based and informal communications systems and frequent explosions and burnings of transmission sub-stations and transformers.”
Nigeria records rise in public debt to N25.7trn
Meanwhile, Nigeria’s total public debt rose to N25.7 trillion as at June 2019, indicating an increase of about N754billion since the Debt Management Office last report in March earlier in the year. The document also showed that the CBN exchange rate of N306.40/$ was used in converting the figure. The document further indicated that FG accounted for the biggest external debt stock in the country with about N7.01 trillion while states and the FCT accounted for N1.3 trillion.
The Federal Government also accounts for the biggest domestic debt, accounting for N13.4 trillion, out of the N17.3 trillion, while states and FCT accounted for N3.9 trillion. This indicates that the federal government debt stood at N20.4 trillion out of the N25.7 trillion while the states and the FCT accounted for the remaining N5.3trillion. The country recorded total debt stock of N24.9 trillion as at March 31 2019 while at December 2018 its debt stock was N24.3 trillion.
Experts have expressed concern over the country’s high debt profile, worrying that the accruing loans may cost the country in the long run. Professor of Development Economics, University of Abuja, Professor Sarah Anyanwu, said the burden of servicing these debts is huge. She noted that not all borrowings should be considered good and that government should borrow externally only for projects with guaranteed return on investment that will be able to pay back the loans.
“It is not the borrowing that is the problem it is the usage of the money. The problem is not taking loans and incurring debt either internal or external, the problem in Nigeria is diversion of the loans to other purposes. If the loans are used for the purposes that they have been stated for then there won’t be a problem. The important thing is that there must be accountability and it must be used judiciously,” she said.
She also called for revalue orientation for management and usage of the FG loans and not for government officials to believe it is their birth right. Also speaking from the same department, Professor Mohammed Yelwa expressed worry over the consistent increase in the debt stock, saying the implication is that the country will get to a point that its revenue will no longer be able service its debt.
To demonstrate its diversity of engagement in transforming the sector, the European Union recently announced a €30 million sustainable energy investment fund for off-grid solution development in the country.
The world is not on track to meet the 2030 global energy targets, set as part of the Sustainable Development Goals, but real progress is being made in certain areas – particularly expansion of access to electricity in developing countries, especially Nigeria and ensuring renewable energy penetration.
The adoption of renewable energy is gaining traction in the electricity sector, although this is not being matched in transportation and heating – which together account for 80 per cent of global energy consumption.
While global trends are disappointing, recent experiences in Nigeria offer encouraging signs. There is mounting evidence that with the right approaches and policies, the country can make substantial progress in clean energy and energy access, and improve the lives of millions of its people.
Reports show that as of 2015, the world obtained 17.5 per cent of its total final energy consumption from renewable sources, of which 9.6 per cent represents modern forms of renewable energy such as geothermal, hydropower, solar and wind. The remainder is the traditional uses of biomass (such as fuelwood and charcoal).
Based on current policies, the renewable share is expected to reach just 21 per cent by 2030, with modern renewables growing to 15 per cent, falling short of the substantial increase demanded by the SDG7 target.
In fact, Nigeria ratified the 2030 Sustainable Development Agenda I 2015 and signed the Paris agreement on climate change in 2017, which commits the country to a reduction in greenhouse gas emission, ranging from 20 per cent to 45 per cent by 2030.
As part of ways to implement the National Determined Contributions (NDCs) mitigation targets, the Federal Government is implementing an ambitious power sector reform totally with its commitment to provide by 2030 affordable and reliable energy and increase share of the renewable energy to 30 per cent as well as upscale the generation capacity to 30GW.
Nigeria’s electricity grid faces many challenges, including the insufficient grid-connection capacity to meet demand, inadequate infrastructure to make the country’s abundant gas available for power generation and an inefficient transmission and distribution system with limited coverage.
Consequently, 50 per cent of the electrical energy consumed in the country is produced off-grid by diesel and gasoline generators of all shapes and sizes and there is unmet demand amongst the rural populace. These energy gaps can be reduced with renewable energy resources potential such as solar, wind, biomass and hydropower energy.
The European Union (EU) is leading the way in improving access to the sustainable supply of electricity in Nigeria, particularly for the poorest within the framework of the 11th European Development Fund (EDF) National Indicative Programme 2014-2020, and has allocated €150 million to the achievement of the national targets.
The purpose will be achieved by strengthening the capacity of relevant agencies in developing policies and tailoring regulations to improve the functioning of the sector. It includes further liberation of the sector, encouraging energy efficiency and diversifying further into sustainable energy sources.
Similarly, the programme will improve the enabling environment for the electricity sector, the development of renewable sources, including vocational training and by strengthening the oversight capacity of non-state actors.
To demonstrate its diversity of engagement in transforming the sector, the European Union recently announced a €30 million sustainable energy investment fund for off-grid solution development in the country.
The fund, Electrification Financing Initiative, (ElectriFI,) would be granted to Renewable Energy (RE) firms that meet some set criteria, including the viability of ideas, with the ultimate aim of growing strategic moves to close Nigeria’s energy gap.
Head of EU Delegation to Nigeria and ECOWAS, Ketil Karlsen, said finding the right mix to diversify Nigeria’s energy supply is important and has to be fueled by investments and infrastructure to give opportunities to entrepreneurs and developers in the sector.
Karlsen noted that the new fund comes after earlier support of a global window fund of €126 million of which Nigeria was a beneficiary. However, the new facility is solely a Nigerian window fund.
He said: “The current generation of power in Nigeria is similar to one of the smallest EU countries, Latvia, with less than two million inhabitants, even if Nigeria’s population is more than one hundred times bigger.”
According to him, how Nigeria approaches this challenge is vital. “Nigeria has the right to development, but there are win-win approaches that can provide the necessary supply while taking into consideration that we need to deliver a better world to the next generations.
“The adverse effects of climate change already has impacted the economy, peace, and stability in Nigeria. We need to keep that in mind as we design our policies.
“This is why we have made the provision of affordable and renewable energy a key priority for our engagement with Nigeria. Upscaling investments, putting in place new finance for electricity mechanisms and providing €165 million grants for specific projects and processes.”
Ambassador Karlsen observed that what the EU does in Nigeria is in effect a reflection of its understanding that there are common but differentiated responsibilities.
“The EU is indeed trying to lead by example, by reducing our own emissions and increasing energy efficiency. Just some month’s back, on December 2018, the EU has established new binding renewable energy targets at 32 per cent for 2030,” he said.
“This is only the beginning, and science has paved the way for potentially reaching 100 per cent within just a few decades. This effort can only be successful if we all contribute. That is why EU Delegation launched fully solar fuelled courtyard and meeting rooms as the first step towards full climate-neutral power consumption,” he said.
Many who are now adults grew up screaming “Up NEPA!” each time the then state utility, the Nigerian Electric Power Authority (NEPA), restored power supply, sometimes after days of power cuts. Now their children are still raising the chant indicating that it is not yet Uhuru for Nigeria’s power sector.
Nearly six decades after independence, Africa’s largest economy has been unable to keep the lights on for millions of its populace beyond five hours a day outside major city centres, a development that sees Nigeria import more generators for household power supply than any other country in the world.
The rule of thumb for an industrial nation is about 1MW for every thousand of population. Therefore, Nigeria’s energy need is about 190,000MW for a population of 190 million, but the most the grid offers is a paltry 4,000MW on good days. Nigeria’s highest ever peak output was Thursday, 7 February 2019 at 21.00hrs when the Transmission Company of Nigeria (TCN) announced that the national grid had successfully transmitted a new generation peak of 5375MW.
Analysts have blamed issues of vested interest, lack of collaboration, corruption, low tariff, energy theft and many years of decay the ineffectiveness and inefficiency that have dogged the power sector for several decades.
The history of Nigeria’s chequered power sector started in 1896 when the first (20MW) power plant was built at Ijora, near Lagos. A structure began to emerge in 1951 with the formation of Electricity Corporation of Nigeria (ECN) to regulate electricity supply and generation. By 1960, the Niger Dam Authorities (NDA) set up to manage dams in Nigeria with a total installed capacity of 50MW.
To consolidate pockets of power generation in different areas, in 1972, NDA and ECN merged to form NEPA, a state-owned vertically integrated power utility that held sway till 2013 with the privatisation of assets of the Power Holding Company of Nigeria.
NEPA was bogged by years of poor investment, inadequate maintenance of power assets, a bloated labour force and government subsidies that fed Nigerians the notion that electricity should be free.
The Federal Government privatised the sector in 2013 modelling it after India’s power sector privatisation. This led to the creation of 11 power distribution companies managing the downstream operations and five generating companies acquiring power generation assets.
Five years after privatisation which earned the Federal Government about $3 billion, the Nigerian government has provided about $10.33 billion, according to BusinessDay calculations, in the form of intervention funding and loans to the players. Actual power supply has risen from about 2900MW to between 3000MW and 4000MW on average. Nigeria’s population grows at over 2 percent annually so entire cities report power cuts that last for weeks.
The power privatisation policy was organised to have the distribution companies (DisCos) who would collect and pay the Nigerian Bulk Electricity Trading (NBET) plc, who will then pay every other operator in the value chain – generation companies (GenCos), gas companies (GasCos) and the Transmission Company of Nigeria (TCN). It was assumed that the DisCos would collect a cost-reflective tariff hence a Multi-Year Tariff Order (MYTO) was developed.
However, “the challenge was assumptions that fed into tariff changed”, said Chuks Nwani, an energy lawyer. And DisCos began to default badly. Inflation jumped from single digit, gas prices rose and foreign exchange went through the roof. This set in liquidity challenges in the system. Operators say the regulator, the Nigerian Electricity Regulatory Commission (NERC), erred by failing to enforce sanctions on defaulters. DisCos withheld more than they should without penalties and political interference marred the process.
Analysts say the privatisation exercise was abused towards the end, when the competent people driving the process were fired and replaced with those pliable to special interests, the regulator was weakened and became susceptible to political interference and the DisCos became the enfant terrible of the electricity market.
By 2 February 2016, power generation which rose to 5074MW crumbled when Niger Delta militants blew up the Forcados pipeline which fed gas to all the critical gas-fired plants in the country and Nigeria’s power sector collapsed.
Babatunde Fashola, former minister of power, works and housing, began an incremental power programme. In 2017, the government secured approval for a Power Sector Reform Implementation Programme along with the World Bank and African Development Bank for a $7.6 billion funding for the sector and began a phased implementation of aspects of the programme.
The same year, Fashola announced that Gencos could now sell power directly to eligible customers and a competition transition charge was arranged to assuage the concerns of the DisCos that they will lose huge market share.
NERC has approved a mini-grid regulation which has provided an opportunity to deepen energy access for rural communities. The Rural Electrification Agency (REA) is ramping up efforts to help communities without access to the grid or those who are underserved to get power through renewable energy sources.
In 2018, NERC approved a Meter Asset Provider policy to stop the DisCos from billing customers using their discretion.
Analysts say more of these reforms are needed to get the power sector out of the current situation.
“We need to make tough decisions and elevate long-term planning above politics, nepotism and vested interests,” said Ayodele Oni, energy partner at Lagos-based Bloomfield Law Practice. Oni counselled that the DisCos need to clearly list what their challenges are and the regulator should listen.
“These will be things such as a cost-reflective tariff and ensuring a national grid that can wheel out generated electricity. On the other hand, the regulator needs to adopt a robust carrot and stick approach, with clear Key Performance Indicators (KPI) and enforceable sanctions,” Oni said.
“This might mean that the performance agreement contracts will have to be reopened and reviewed, and we really have hit the reset button in the power sector and get serious,” he said. In August, the regulator signalled an intention to begin to address the lack of cost-reflective tariff by reviewing the MYTO electricity pricing template which raises the price on average by 30 percent. Reforms have also been announced to help the TCN deliver better wheeling capacity.
In July, a power agreement was signed between the Nigerian government and Siemens, a leading German electric company, that will see the German company upgrade transmission and distribution networks which could double Nigeria’s electricity generation and raise distribution capacity three-fold to 11000MW by 2023
President Muhammadu Buhari said he directed Siemens to fix the power distribution and transmission aspect of the electricity challenge in a road map brokered by German Chancellor Angela Merkel when she visited Nigeria in 2018. Analysts are optimistic that such collaborations may help dent Nigeria’s poor power output.
But an operator who was an executive director in the defunct National Electric Power Authority (NEPA) said when Nigeria is ready for electricity, it would go for it.
“I don’t believe Nigeria is good enough for steady power supply. The tariff is not right and there is huge energy theft, yet the government is telling investors to go to court. How can there steady power supply?” said the operator who does not want his name mentioned
Experts and stakeholders have stressed the need for adequate financing of the energy sector in Nigeria for any meaningful progress to be achieved.
This emphasis was made at the 2019 Power Nigeria Exhibition and Conference which held at the Landmark Centre Lagos. The conference is the largest power event serving West African utility, commercial, industrial and key-end user markets brought together experts from the financial sectors including, the Central Bank of Nigeria, FBNQuest Merchant Bank and Nigeria Infrastructure Debt Fund to discuss collaborative strategies to close the financial gap in the Power sector.
At the programme, experts in attendance shed light on the reforms needed in the energy sector to attain its full potential and yield returns on investments. They also discussed how lack of access to capital is hindering the electricity sector.
Also highlighted were frameworks for assisting companies with funding requests; risk mitigation tools in projects or expansions; electricity-focused mutual funds/collective investment schemes in Nigeria; returns investors can expect and how lending rates can be improved in the next two years.
Speaking at the conference, the Commissioner, Ekiti State Ministry of Infrastructure and Public Utilities, Mr Bamidele Faparusi, explained how good customer relationships are essential for improving the quality of power in the country.
Using Ekiti state as a case study, the Commissioner said, “Improving the power sector in Nigeria calls for collaborative effort between the government, private sector and the end users.
“Unpaid electricity bills affect the proper running of the sector, hence, a need for DisCos to build trust and maintain good relationships with the end users so as to minimize default in payments and address power issues.
“In addition, huge financial investments should be made in distribution networks to attain smartness and profitability while regulatory agencies should ensure compliance with stipulated rules and guidelines”.
On her part, Head –Energy and Natural Resources, FBNQuest Merchant Bank, Ms Rolake Akinkugbe-Filani, said there is a huge financial gap in the sector that needs to be urgently addressed to meet sector growth.
According to Ms Akinkugbe-Filani, “The Nigerian Power Sector needs to rid itself of legacy debt of over 300 Billion Naira if any progress is to be made.
“There is a need for private funding to be injected into the system and for an urgent shift in the funding landscape from investment banks to SME initiatives. Private sector investment could come in terms of advisory, capacity building for project developers as well as financing for capital projects.”
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Vice President Yemi Osinbajo has said the federal government has injected about N1.5 trillion intervention fund into the power sector in the last two years, even as frequent outage persists across the country. Speaking at a power sector roundtable hosted by Mainstream Energy Solutions Limited (MESL) at its Kainji Hydropower Plant in Niger State on Tuesday, Osinbajo who was represented by the Minister of Power, Engr. Sale Mamman, said “the Federal Executive Council (FEC) approved the third round of intervention funding for the sector, with a total of about N1.5 trillion in the last two years.
“However, if the country is to achieve its aim of channelling funding to other critical sectors, it is pertinent that structural reforms be put in place to enable the power sector fund itself sustainably,” Osinbajo stated. Daily Trust reporTED that N213 billion was given by CBN in 2015 to settle legacy debts of the privatised firms. Another N701bn was given to help Generation Companies (GenCos) to cover operational expenses between 2017 and 2018. The FEC in 2019 approved another N600bn for the GenCos which totalled N1.7 trillion.
Falls & ups Copy video url Play / Pause Mute / Unmute Report a problem Language Mox Player Shortly before declaring the meeting open, Osinbajo said President Muhammadu Buhari plans to lift 100 million Nigerians out of poverty in 10 years, noting that it can only be achieved with a thriving power sector to drive industrialization. “I implore all key power sector players to resolve to think of the solutions to the challenges in the sector,” he said.
The chairman, Board of Directors of MESL, Col. Sani Bello (rtd) urged the federal government to intervene in ensuring that monthly invoices’ payment for energy generation was improved from the paltry 15 percent it is getting. “As at May 2019, we only received 15%. I don’t think any GenCo can survive with that,” he noted and urged government to provide cost reflective tariff. Col. Bello said MESL operates Kainji and Jebba hydropower plants adding, “when we took over these plants about six years ago, their capacities were less than 300 megawatts (MW). But today, we have more than doubled that.”
MESL at the meeting tagged, ‘Next Level for the Nigerian Power Sector – Unlocking Real Liquidity’, said both plants now have 922MW capacity, generating 25 percent of the national grid energy. To expand the plants, MESL has awarded a $27 million contract to recover Unit1G7 at Kainji plant. It will also spend $60m to rehabilitate Unit1 G8 and 9 turbines in the plant. For Jebba plant, MESL said it will spend $32m to rehabilitate its turbines while budgeting for the maintenance of other turbines. MESL will also invest $109m to expand the Kainji plant by installing two turbines to generate 240MW additional power to the national grid.
It has also spent N1.4 billion on 109 community enhancement projects around the dam sites of its two power plants. At a panel session, the Partner and Chief Economist of PwC Nigeria, Mr Andrew Nevin, said PwC suggests that the electricity market could get N400bn liquidity if industries’ tariff was raised to N80 per kilowatt hour (kwh), and 50% electricity is dedicated to industries.
The Managing Director of the Transmission Company of Nigeria (TCN) Mr Usman Gur Mohammed, commenting on the sector privatization said, “Yes we have made significant progress since privatization. “Generation has reached 7500MW, transmission has gone to 8100MW and distribution moved from 3000MW to 5000MW. We have made progress but not as fast as we thought it would be”, he said.
The United States Trade and Development Agency (USTDA) is providing funding for three projects that will help to electrify many rural communities and deliver critical gas resources to support economic activity and job growth while helping US companies export goods and services.
The organisation said it has committed funding for a feasibility study to help Xenergi Nigeria Ltd. expand and construct a natural gas gathering and processing plant that will substantially increase access to customers in the Niger Delta region.
USTDA also committed funding to help the Abuja Electricity Distribution Company provide electricity to underserved communities through the implementation of up to 1,370 solar-powered minigrids with energy storage systems. USTDA Colorado’s Rocky Mountain Institute will carry out the study.
USTDA is further providing funding for a study to assist Havenhill Synergy Limited to develop off-grid solar and storage minigrid sites in up to 110 Nigerian communities. That study will be completed by Colorado-based Odyssey Energy Solutions, Inc.
“While this is a validation to the quality of the work we do in Nigeria, most importantly, it helps us to develop a portfolio of 110 solar mini-grids projects that will be finance ready at the end of this feasibility study and will impact over 300,000 off-grid population,” said Olusegun Odunaiya, CEO Havenhill Synergy Limited.
Havenhill says it wants to carry out development activities in 110 communities across Nigeria that will potentially host its portfolio of off-grid smart solar mini-grids which will serve as the first access to clean electricity by the inhabitants of the community.
According to Havenhill, this study will be done in collaboration with Odyssey Energy Solutions Inc. who will provide the technical support required for the development of the project. US firms will also have the opportunity to help Xenergi in conducting the study.
Though the organisations did not disclose how much funding is involved, findings show the USTDA receives over $50million yearly in funding. In 2017, it requested for of $80.7 million and got 25 percent more according to the US-based Center for strategic & International Studies.
While the USTDA has been targeted for elimination, “The agency boasts an export multiplier of $85 for every $1 spent on programs,” says the Center for Strategic & International Studies.
USTDA says these activities all support Power Africa, a U.S. government-led initiative to increase electricity access across the continent, and Prosper Africa, a U.S. government initiative to substantially increase two-way trade and investment between the United States and Africa.
“Nigeria is a dynamic market with many opportunities for cooperation between our private sectors,” said USTDA Acting Director Thomas R. Hardy. “USTDA’s support for these energy projects will strengthen important business ties between our countries and deliver important results for the Nigerian people.”
USTDA has now funded more than 70 projects in Nigeria focused on energy, telecommunications, transportation, healthcare, and agribusiness over the past 27 years.
The U.S. Trade and Development Agency helps companies create U.S. jobs through the export of U.S. goods and services for priority development projects in emerging economies. USTDA links U.S. businesses to export opportunities by funding project planning activities, pilot projects, and reverse trade missions while creating sustainable infrastructure and economic growth in partner countries.
The Ministry of Science and Technology says it will play a leading role in resolving the nation’s perennial power crisis through the deployment solar energy in public buildings.
Minister of Science and Technology, Dr Ogbonnaya Onu, who said this in Abuja on Monday at a press briefing, added that the ministry was tapping into various forms of renewable energy, including solar and thermal sources of power.
Already, according to him, four agencies under the ministry were working with other government bodies to harness solar energy to provide electricity across the country.
He listed the technology agencies as Energy Commission of Nigeria, Nigeria Building and Road Research Institute, National Agency for Science and Engineering Infrastructure and Project Development Institute.
According to him, the agencies were working with the ministries of power, works and housing, environment and industry, and trade and investment to deploy various energy solutions.
The plan, which involves the mounting of solar panels on public and private buildings, is expected to provide solar-powered electricity to private homes, schools, hospitals, markets, petrol stations and rural communities.
Onu said the ministry intended to approach the Federal Executive Council with a memo to seek the approval of the plan to mount solar panels on the roofs of buildings across the country.
In an article for Bloomberg, Judd Devremont and Todd Moss highlight the rapid urbanization of Africa, arguing that the success or failure of Africa in the global economy will depend on its cities. In Nigeria, this can be seen most clearly in Lagos.
At independence in 1960, Lagos had an estimated population of 763,000; today it is about 13 million. Together with Lagos state, the population reaches 21 million. While Lagos is by far the largest city in Nigeria, security concerns, rural poverty, and hopes for greater economic opportunity are driving people to cities all over the country. In the decade between 2007 and 2017, Nigeria’s urban dwellers increased from 41 percent of the population to about 50 percent. In 2019, there were 7 cities with a population of one million or more, 80 with a population ranging between one hundred thousand and one million, and 248 with a population between ten thousand and one hundred thousand.
But much of this urbanization is unplanned and chaotic. According to a World Bank report about African cities, “Africa’s cities feel crowded precisely because they are not dense with economic activity, infrastructure, or housing and commercial structures.” They lack “formal housing in reach of jobs, and without transport systems to connect people living farther away,” forcing residents to “forgo services and amenities to live in cramped quarters near their work.”
The realities of life in Nigerian cities are hard. In Lagos, about two of every three people live in a slum. Less than 10 percent of residents have access to piped water (for those that do, it is often riddled with sediment and unsafe to drink), forcing urban households to purchase water from vendors at up to three times the normal price charged by Lagos state. Only six percent of urban households have a flushing toilet that is connected to a sewage system.
But life goes on. For all its shortcomings, Lagos is the center of much of what is dynamic and vibrant about Nigeria, a point Judd and Todd stress about African cities in general. The informal economy provides employment incompletely captured by statistics. In Lagos, there are few beggars; everyone has a hustle. Vendors working the city’s ubiquitous traffic jams (“go slows”) sell everything from mops and buckets to juju materials to the complete works of Shakespeare.
Others provide services, such as washing the feet of market ladies several times a day. It is the home of Nollywood, a home-grown film industry that is widely influential in Africa and spreading around the world. It is the center of Nigerian telecommunications, and cell phone use is ubiquitous. The Nigerian Communications Commission stated that Internet users in Nigeria numbered 116 million in March 2019—well over half of the country’s estimated population.
The most modern of financial and other services are available to clients in the Lagos-Ibadan corridor, the capital Abuja, and sporadically elsewhere. Information technology and sophisticated financial services are starting to power the modern sectors of the economy, though not to the same extent as in South Africa or Kenya, though the economy of Lagos state is larger than that of Kenya. Hence, as Judd and Todd argue, they require attention for their enormous potential, both good and bad.
President Muhammadu Buhari has approved the re-appointment of Mr. Ade Ipaye as Deputy Chief of Staff to the President.
Ipaye who was former Attorney-General and Commissioner for Justice in Lagos State works from the Office of the Vice President.
The President has also approved the re-appointment of Dr Adeyemi Dipeolu, Special Adviser to President on Economic Matters; Mrs Maryam Uwais who retains her position as Special Adviser to the President on Social Investment Programme as well as Senator Babafemi Ojudu, Special Adviser to the President on Political Matters.
Ade Ipaye reappointed as deputy chief of staff
Also, re-appointed is Dr. Jumoke Oduwole, who will now serve as the Special Adviser to the President on Ease Of Doing Business.
Equally, President Buhari has also appointed Ime Okon as Special Adviser on Infrastructure, Mr. Obafela Bank-Olemoh, as Senior Special Assistant on Education Interventions, Mr. Louis Odion as Senior Technical Assistant on Print Media, and Mr. Ajuri Ngelale as Senior Special Assistant for Public Affairs in the Presidency