escort ankara

Pressure Mounts for Recapitalisation, N1.6trn Funding of 11 DisCos

There are rising calls for the capitalisation of the 11 power Distribution Companies (DisCos).

Daily Trust in this exclusive piece dissects the content of a memo that stipulates injecting $4.3 billion (about N1.556 trillion) into DisCos’ networks, and increasing government representatives sitting on the DisCos’ boards.

The document was addressed to the former Minister of Power, Works and Housing, Mr Babatunde Fashola on May 22, 2019 which it was gathered constituted part of his handover note shortly before he left office.

The Transmission Company of Nigeria (TCN) said the DisCos lack revenue collection capacity and that TCN solely relies on them for payment to finance transmission services.

“The DisCos because of their general weak capacity are collectively remitting about 30% of the Market Operator (MO) invoices and have accumulated over N231 billion outstanding due to be paid to TCN as at March 2019.”

It also complained of rising voltage during the rainy season where it alleged that the distribution networks are weak and with the massive loss of energy load due to tripping of several 33 kilovolt (KV) at the slightest weather turbulence or rainfall.

A similar memo was addressed to the minister in January 2019.

It said ‘DisCos’ network is currently in a very weak state and requires significant investment to fix it; this can only be achieved by recapitalising the DisCos.’

TCN at a recent briefing had said it simulated the investment requirement of DisCos which shows they need $4.3 billion (about N3 trillion).

With over eight million registered electricity customers in Nigeria, the company said that figure will help the DisCos to match transmission network expansion that targets 20,000 megawatts (MW) wheeling capacity by 2021. At present, transmission wheeling capacity is at 8,100MW, generation capacity is over 7,500MW while distribution capability is around 5,500MW.

The Managing Director of Mainstream Energy Solutions Ltd (MESL), operators of Kainji and Jebba GenCos, Engr. Lamu Audu had in June joined the call for capitalisation of the DisCos.

“The DisCos should be made to capitalise because there is little investment and the electricity sector is a value chain. If one end is not doing well, it will affect the others.”

How to use $4.3bn funding

The memo said the $4.3bn investment should be used to rehabilitate and upgrade the existing poor distribution network, build new injection substation to cover the 316 unprotected interface the 11 DisCos share with the transmission network.

Out of the 737 total interface where transmission facilities deliver power to distribution facilities, 421 of them have adequate protection but the 316 others have not.

The DisCos should build new feeders and injection substations to take more supply from existing and new transmission substations. The memo which was also sent to the Presidency advocated a tariff from the Nigerian Electricity Regulatory Commission (NERC) to support the capitalisation. “

It is expected that with long term loan with five years moratorium and 10 year repayment period, the tariff will be reasonable because the capital will be used to reduce the Aggregate Technical Commercial and Collection (ATC&C) losses during the moratorium before interest kicks in,” it noted.

The Federal Government should compel NERC to do regular minor reviews and in line with Eligible customer regulation, all agencies that can pay for power should be removed from any the Nigerian Bulk Electricity Trading Plc (NBET).

Other 132kv customers and foreign customers (Niger, Benin and Togo) which were not part of DisCos performance contracts should also be removed.

Process for $4.3bn recapitalisation

Referring to the 2013 privatisation, the memo said it was marred with technical flaws and financial incapacitation of the investors.

To address these mistakes, the federal government which still hold 40 per cent shares in the DisCos must divest and use the $1bn Power Sector Recovery Programme (PSRP) and World Bank loan, and $500 million loan from the French Development Agency (AFD) for its 40% fund. The private investors should bring their equity of 60% recapitalisation fund.

Shareholders agreement of the DisCos should be amended to have proportionate representative of government and the private owners at the Boards, the memo suggested.

Instead of the one Director from BPE representing government, there should be four from government to match the six from the private sector owners.

“The Ministry of Finance Incorporated (MOFI) should also be empowered to represent the government on the Boards of the companies. This will remove the current conflict of interest in which BPE that is managing the performance contract with DisCos and is also representing government on their board,” it said.

Source: Dailytrust

Nigeria Needs N36 Trillion Investment to Achieve Stable Power Supply

It will take not less than $100 billion, approximately N36 trillion, to enable stable power supply in Nigeria. This is according to the Electricity distribution companies (Discos).

The Discos said the N36 trillion worth of investments will be needed over a period of 20 years.

How the investments will be deployed: The Discos disclosed that the investments will include over $10 billion (about N3.6 trillion) in distribution networks over the next 5 years.

The entire power supply value chain of the Discos, according to them, will also gulp about $40 billion (about N14.4 trillion) over the next 20 years.

READ MORE: Manufacturers spent over N246 billion fuelling generators

The Discos would also have to invest about $4.2 billion in the interface project developed by the transmission network in furtherance of TCN’s expansion plan.

Need for stable electricity: The need for electricity to be stable in the country cannot not be over-emphasised. According to the November 2018 edition of the Monthly Business Expectations Survey Report of the Central Bank of Nigeria (CBN), the most compelling factor constraining businesses in Nigeria is insufficient power supply.

The survey underscored the fact that electricity is a very necessary and important ingredient required for businesses to function properly and to expand. Higher electricity costs drive business costs higher and reduce business competitiveness. This is because as costs of electricity rises, businesses look for alternative power sources like generators leading to reduced output and productivity thereby rendering them less competitive.

Similarly, a recent research by the World Bank reveals “that power outages and deficient power infrastructure in Sub-Saharan Africa had a measurable negative impact on economic growth over the period of 1995−2007”.

Can lingering power supply instability be solved? Aside from being Africa’s largest economy, Nigeria is blessed with large oil, gas, hydro and solar resource. Thus, the country has virtually all that it needs to meet it’s electricity needs. All that is missing is the political will.

Source: nairametrics

Power Generation Falls to 3,390MW, Seven Plants Idle

The nation’s power generation dropped to 3,390.7 megawatts on Monday as seven plants, including three built under the National Integrated Power Project, sat idle.

Electricity generation has been hovering around 2,600MW and 3,800MW as of 6.00 am every day since the start of this month, according to data obtained by our correspondent. It plunged to 2,692.7MW on June 7.

Seven power plants, namely Afam IV&V, Alaoji NIPP, Olorunsogo NIPP, Gbarain NIPP, Okpai IPP, AES IPP and ASCO IPP, did not generate any megawatts of electricity as of 6.00 am on Monday.


Total generation fell slightly to 3,429MW as of 6.00 am on Sunday from 3,461.7MW on Saturday, data from the Nigeria Electricity System Operator, an arm of the Transmission Company of Nigeria, showed.

The amount of electricity produced by the nation’s 27 power plants stood at 3,898.9MW as of 6.00 am on Friday, the highest level achieved so far this month at that time of the day.

The plants generated 4,050MW as of 6.00 am on May 30 but their total output dropped to 3,161.6MW on June 1, according to the data.

The system operator put the nation’s installed generation capacity at 12,910.40MW; available capacity at 7,652.60MW; transmission wheeling capacity at 8,100MW; and the peak generation ever attained at 5,375MW.

The nation generates most of its electricity from gas-fired power plants, while output from hydropower plants makes up about 30 per cent of the total.

Last month, the power grid experienced what the Managing Director of TCN, Mr Usman Mohammed, described as the worst system instability since he assumed office.

The data from the system operator showed that power generation plunged to zero megawatt as of 6.00 am on May 9 and 10.

The TCN, which manages the national grid, is still fully owned and operated by the government.

The grid has continued to suffer system collapse over the years amid a lack of spinning reserve that is meant to forestall such occurrences. It has suffered seven collapses so far this year.

Spinning reserve is the generation capacity that is online but unloaded and that can respond within 10 minutes to compensate for generation or transmission outages.

Out of the five power stations meant to provide spinning reserves, none has any actual reserve, with the contracted reserve put at 295MW.

The power stations are Egbin, Delta, Olorunsogo NIPP, Geregu NIPP and Omotosho NIPP.

More than five years after the privatisation, the investors who took over the six generation companies and 11 distribution companies that emerged after the unbundling of the Power Holding Company of Nigeria are still grappling with the old problems in the sector.

The sector is plagued with problems of gas supply shortages, limited distribution networks, limited transmission line capacity, huge metering gap, electricity theft, and high technical and commercial losses, among others.

The financial viability of the Nigerian electricity supply industry remains the most significant challenge threatening the sustainability of the power sector, according to the Nigerian Electricity Regulatory Commission.

Source: Punchng

porno - mobil porno - türkçe porno - sex izle - seks hikayeleri - sohbet numaraları
Translate »
escort sakarya escort edirne escort kayseri escort konya escort ısparta escort bornova