25 Jan 2008: Seth Akintoye, Festus Akanbi and Clara Nwachukwu
Eight months after President Umaru Yar‘Adua promised to declare a state of emergency in the power sector, there are indications that Nigerians may have to wait a little longer for uninterrupted power supply.
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Alhaji Umaru Musa Yar‘Adua
This indication emerged on Tuesday when the Minister of State for Energy (Power), Mrs. Fatimah Ibrahim, told The PUNCH that the declaration would be made after the National Energy Council would have submitted its report.
Investigation by our correspondents revealed that the council, which was set up last September, was yet to hold its first meeting.
The Honorary Presidential Adviser on Energy, Dr. Rilwan Lukman, recently said that the six months given the NEC to complete its assignment was inadequate.
Nigeria, with more than 140 million people, has a total installed output of 3,200 megawatts.
However, the output dropped to 1,200MW in the first quarter of 2007 due largely to shortage of gas, and vandalising of petroleum pipelines in the Niger Delta.
Investigations have also shown that contrary to the claim of the incumbent administration that about $10 billion approved for the energy sector between 1999 and 2007 was squandered by the former President Olusegun Obasanjo administration, about N521bn ($4.07bn) was indeed approved between 1999 and 2007.
The NEC, which is chaired by the President, is the highest decision making body in the energy sector. It is expected to make fundamental decisions that would help pull Nigeria out of the crisis in the entire spectrum of the oil and gas and power sectors.
The 12-member council includes the Ministers of State for Energy, Mr. Henry Ajumogobia(Petroleum); Mr. Emmanuel Odusina(Gas) and Hajia Halima Ibrahim(Power).
The NEC Secretary , Mr. Hassan Tukur, who reacted to the growing anxiety by Nigerians over the worsening power supply problem in the country said the council had not been able to meet because several proposals were being looked into by the National Assembly‘s committees on power, and oil and gas.
These proposals, according to him, needed to be distilled before being brought before the council.
”The council is an advisory body and is supreme. You do not send simple recommendations to them because that would be undermining the ministers who have the duty of running their respective ministries,” he said.
According to him, the National Assembly committees on power had met 44 times and submitted an 80-page progress report to the NEC.
He added that the report suggested some short-term solutions, which would help achieve some improvements in the power sector.
Tukur, who spoke with one of our correspondents on the telephone in Abuja on Tuesday said, ”The work of the committees is done in phases.
“Sub-committees can invite consultants and people in the sector to join them. After completing its work, they will submit it to the plenary, which will now submit it to the NEC, which would now deliberate and advise government on how to address the fundamental problem.”
He explained that the committee was looking into power generation, the existing facilities, the master-plan and major projects.
The secretary said, ”They are also looking into the unbundling of Power Holding Company Nigeria and what is to be done to ensure that synergy between the companies.
“We found out that there was no effective co-ordination between these companies. If Kanji decides that it will not supply water to Jebba, what will happen?”
Tukur also explained that the council and the committees would adopt a systematic approach, which was absent in the past.
”We want to find out the problem, get the solution and find out where we will get the finance to run it, whether it is from the public sector or private sector. After getting the whole picture, we will now begin the implementation mechanism,” he said.
He explained that it was decided that the privatisation of the power and oil and gas sectors be suspended because they were part of what the committees were working on.
He asked Nigerians to be patient because 80 per cent of the committees’ work would have been completed by the time the six months’ deadline the NEC was given expired.
But speaking on the telephone with one of our correspondents, the Chairman, Senate Committee on Power, Steel Development and Metallurgy, Senator Nicholas Ugbane, said there was no bill yet on the power sector at the National Assembly.
”We are yet to visit all the NIPP projects and conduct value audit,” he said.
However, a statement signed last year by the General Manager, Public Affairs, PHCN, Mrs. Efuru Igbo, explained that N521bn ($4.07bn) was approved for the sector between 1999 and 2007 as against the $10 bn figure being reported in the press.
She pointed out that out of the amount, the PHCN only received N264bn ($2.06bn).
The PHCN chief spokesperson explained that the National Integrated Power Projects and the Niger Delta Power Holding Company Plc received N257bn ($2.01bn), which made up the $4.07bn.
She said then, ”It should be appreciated that power sector is capital intensive and has long gestation period. The international benchmark price for the construction of a new 100MW power plant is $100m (N12.8bn).”
According to her, with adequate and timely funding, it takes an average of three to four years to complete a 100MW Greenfield power station and about three years to complete a 100KM high tension transmission line and substation.
She explained that so much had been spent on the rehabilitation of the nation’s power plants due to ” lack of maintenance”.
But power generation went down from installed capacity of about 5200MW to 1,750MW, as compared to a load demand of 6,000MW.
Igbo had said this was because ”only 19 out of the 79 installed generating units were in operation.”
Industry operators have, however, argued that the period given the NEC was enough for it to come out with recommendations to reshape the power sector.
”Six months is enough for any serious committee to do something. But if they say it is not, then they should be able to say exactly how long they will take and why,” the Managing Director, International Energy Services, Dr. Diran Fawibe, said.
Fawibe challenged the council to give a specific timetable for the completion of its assignment.
Investigations revealed that the Federal Government, in collaboration with the states and local governments in 2005, embarked on the construction of new power stations under the NIPP.
The power stations include Calabar 561MW, Egbema 338MW, Gbarain 225MW, Ihovbor/Eyaen 451MW, Sapele 451MW and Omoku 230MW.
NIPP also involves the construction of transmission lines, associated sub-stations and reinforcement of distribution infrastructure. About N257bn ($2.01bn) has so far been funded.
However, Chevron is constructing a 780MW station at Agura, Lagos, at a cost of $750m.
Also, Shell Petroleum Plc is building a 1000MW station at Afam, Rivers State at a cost of $1bn.
When contacted on Wednesday, the Special Adviser to the President on Power, Mr. Joseph Makoju, declined comment on the worsening power supply in the country.
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