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Power Sector: A Huge Economic Challenge

Independent 5 days ago
Shell

During the presidential campaign of former President Muhammadu Buhari, Mr. Babatunde Raji Fashola, hailed as the golden boy of the party, repeatedly em­phasized the urgency of address­ing Nigeria’s power challenges. At various public events, includ­ing the 7th Annual Colloquium in Lagos, Fashola asserted that the ineptitude of the previous administration should not be repeated, boldly stating that “Any serious government can fix the power problem within six months.” Nigerians placed their trust in him, influenced by the transformation witnessed under his leadership in Lagos between 2007 and 2015.

In 2014, during a significant ceremony held at the Blue Roof, Lagos Television premises, to mark Mr. Fashola’s 2,600 days in office, he made a bold assertion: “The only way to get uninter­rupted electricity supply in the country is to vote out the ruling Peoples Democratic Party (PDP) in the forthcoming 2015 general elections.” This statement was backed by his notable achieve­ments, including effectively han­dling the Ebola crisis and creat­ing approximately 500,000 jobs for the citizens of Lagos State over eight years. Mr. Fashola’s administration also left a last­ing legacy with the construction of three bridges, including the iconic Lekki-Ikoyi link bridge, and the completion of five (5) Independent Power Projects, no­tably the one at Alausa, which significantly reduced reliance on generators. Given his im­pressive track record, it’s un­derstandable why many believed in Fashola’s assurance that the ruling party would address the national power grid issues and ensure adequate power supply to the people.

The country is in dire need of an immediate solution to its power supply issues. Many young citizens possess the drive and passion to contribute to the nation’s development, yet they are hindered by the lack of ad­equate power supply. Without reliable electricity, aspiring en­trepreneurs find it exceedingly difficult to establish and sustain businesses, such as operating POS services, due to frequent power outages and the inability to charge devices. The current state of total darkness or errat­ic power supply significantly hampers the growth of small and medium-scale enterprises. It’s crucial to recognize that no nation can achieve sustainable growth and development with­out ensuring reliable access to power.

The Egypt Megaproject stands as a testament to Sie­mens’ historic achievement, delivering 14.4 GW of power capacity to Egypt’s grid in a re­cord-setting 27.5 months from financial closure. This monu­mental endeavor not only allevi­ated persistent power shortages but also propelled Egypt toward long-term power security, cru­cial for industrial growth. Addi­tionally, the swift completion of two simple cycle power plants in Assiut and West Damietta, total­ing 1,500 MW, within just eight months in 2015, further exem­plifies the efficacy of visionary leadership and practical imple­mentation. While comparing ourselves to China’s Belt and Road Initiative may seem ambi­tious, studying such initiatives could offer valuable insights into addressing our own chal­lenges with consistent power shortages.

It is evident that effective leadership is paramount in driv­ing the reform agenda for our country, and the support of the people is crucial in this journey towards a greater Nigeria. The Ministry of Communication, In­novation and Digital Economy deserves commendation for its proactive measures, including the introduction of the 3 Million Technical Talent (3MTT) Pro­gram. This initiative has been well-received by Nigerians as it offers a promising platform for success in the IT sector. Howev­er, to truly maximize the impact of such programs, reliable elec­tricity is indispensable. Access to power is essential for pow­ering up gadgets and enabling active participation in training programs. Therefore, it is im­perative that efforts to improve electricity supply align with the goals of the ministry to ensure the success of initiatives aimed at empowering Nigerians in the digital age.

When the current minister was appointed, his first initia­tive was to start a weekly politi­cal socio-event, capturing all his former political associates from his former political party. This went on for months, neglect­ing the core mandate given to him by the presidency. It raises questions about the minister’s understanding of the urgency and uniqueness of the minis­try’s challenges, as evident in his preoccupation with political mandates extending far beyond his current tenure. The current minister is not in sync with the presidency’s renewed hope agen­da. The country needs an urgent solution but often times when we see the minister appear in a gathering, it has always been in a political setting which wouldn’t have a positive impact on the general populace. The will and experience aren’t there and neither of the two can be forced into a man’s ability. Given the critical nature of this ministry, it was a mistake to treat it as a trial-and-error endeavor. It is ev­ident that the current minister is completely bewildered. This calls for a reassessment of our approach.

Despite numerous challenges, the Transmission Company of Nigeria has failed to fulfill its mandate of efficiently trans­mitting power from generating stations to the people. Presently, the country boasts an installed power capacity of 12-16,000MW, yet even if we assume we’re generating 50% of this capacity, roughly 7GW, the transmission network has only managed to transmit about 4-5GW of power over the last eight years. This stagnant performance under­scores the dire need for struc­tural reforms within the agency. Given the pressing necessity for change, the co-ordinating minis­ter should prioritize a compre­hensive overhaul or restructur­ing of the agency.

Egypt’s energy strategy has evolved beyond thermal sta­tions, with a concerted effort to diversify into renewable sources. Beginning in 2016, the government prioritized solar, wind and conventional pow­er, incorporating gas turbines while halting the development of hydropower stations. During the period from 2010 to 2022, significant progress was made, adding 16GW of power, largely attributed to wind and solar en­ergy. Given the immense poten­tial and demand in this sector, it is crucial to appoint a leader who not only comprehends the role but also possesses a resolute and non-controversial demean­or.

The advancement proposed could significantly benefit small and medium-scale enterprises (SMEs), but it is essential for the president to take decisive action and assume control of the min­istry. The progressives, typically afforded considerable leniency, have expressed dissatisfaction with the ministry’s performance thus far. It’s crucial to communi­cate the citizens’ discontent to the presidency promptly. There’s still ample opportunity to enact meaningful changes and rectify the course. However, failure to address the shortcomings of the ministry could have dire conse­quences.

The country has been experi­encing total grid collapse since time immemorial, however, be­tween 2017 and 2023, the nation witnessed 46 grid collapses. It is accounted that in 2023 alone, the grid collapsed 12 times, ac­counting for 26%. The data re­ceived in performance hasn’t improved and if proper analy­sis of the Disco’s are examined also, it will equally give the same retrogressive output. No nation that is desirous of prog­ress can actually achieve such with the present state of things. In the latest data released by the Nigeria Electricity Regulatory Commission, NERC, most Dis­cos have low performance in cash collection with very high billing efficiency, which has a very adverse effect on the AT & C losses of the companies. Of­tentimes, there are regulations to improve the performance of the distribution companies but the major stumbling blocks are still with the government. If ur­gent action is not taken, we will continue to drag the same issues in 2027.

Tunisia with a vision has re­cently concluded a plan to em­bark on a special power project called Tunisia-Italy Interconnec­tor (ELMED). The ELMED Inter­connector Project is a planned bi-directional power exchange link between Italy and Tunisia. The 600MW capacity project will be the first direct current con­nection between Europe and Af­rica. These are the kinds of ini­tiatives that we know President Asiwaju for but unfortunately, no one can drive it in the Minis­try of Power. Solutions to each of the various value chains in the power sector must be item­ized and implemented as soon as possible, to guarantee adequate and uninterrupted power supply to the country.

The citizens of the country want to stay back and develop their nation, which will give them the chance to compete with the rest of the world, but they need an adequate power supply. The only hope that they have is the belief that your capability is undoubted to deliver the re­newed hope agenda. The young Nigerians who will benefit through the enormous jobs are counting on you while the SMEs don’t want to lose hope either.

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