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Tuesday, October 24, 2023

Experts canvass investments to bridge Nigeria’s power deficit

Power plant


For Nigerians to enjoy constant electricity supply, there is need for more investments in the sector that will culminate in the country being able to generate 200,000 MegaWatts (MW). This implies Nigeria needs additional 195,400 megawatts to meet its electricity needs, because it currently generates an average of 4,600MW for a population of 200 million people.

The Group Managing Director, Mojec International Limited, Chantelle Abdul, who disclosed this at the yearly strategic international conference of the Association of Energy Correspondents of Nigeria (NAEC), in Lagos, said low energy generation is responsible for frequent blackouts being experienced in the country.

The power subsector is also being plagued by inadequate metering of customers. Despite the two per cent change in the metering rate, the metering gaps have remained, resulting in about seven million unmetered customers.

According to the Nigerian Electricity Regulatory Commission (NERC) 2023 second quarter report, as of June 30th, 2023, there are 12,561,049 registered electricity customers with 44.16 per cent (5,546,483) of them metered leaving 55.84 per cent (7,014,566) of customers unmetered.

NERC said over the course of 2023/Q2, 178,864 end-user customers were metered, which increased the metering rate by 0.85pp relative to the 43.31 per cent recorded in 2023/Q1 with a two per cent change in metering rate by the DisCos.

While the meter crises remain defiant, the NERC said average available generation capacity of the 26 grid-connected power plants has dropped to 4,387.91MW (4.73per cent) compared to 4,605.72MW recorded in 2023/Q1.

NERC explained that the drop was due to gas constraints and mechanical faults affecting gas-fired thermal power plants, unscheduled maintenance, shutdown, total overhaul, depletion of dam reserves, and water management affecting hydro-dams.

The report stated that 16 out of the 26 grid connected power plants recorded a decrease in total generation in 2023/Q2 compared to 2023/Q1, resulting in a decrease of -5.17 per cent (-483.19GWh) from 9,350.24GWh generated in 2023/Q1.

NERC further reported that the average hourly generation of available units decreased by 6.33 per cent (- 274.47MWh/h) from 4,334.41MWh/h in 2023/Q1 to 4,059.94MWh/h.

On the metering issue, the electricity regulator further disclosed that Ikeja, Ibadan, Abuja and Enugu DisCos had the highest number of meter installations in 2023/Q2 accounting for 72.69 per cent of total installations.

“Relative to 2023/Q1, eight DisCos recorded improvements in the number of meter installations with Benin (+28.40 per cent), Kano (+25.99 per cent), and Eko (+15.85 per cent) recording the greatest improvements. Conversely, Yola (-24.55 per cent), Kaduna (-6.27 per cent), and Enugu (-2.83 per cent) recorded a decline in the number of meters installed compared to 2023/Q1.”

NERC report further stated that out of the 178,864 end-use customers metered in 2023/Q2, 94.15 per cent customers were metered under the Meter Asset Provider (MAP) framework, 5.20 per cent were metered under the National Mass Metering Programme (NMMP) framework, 0.64 per cent under the Vendor Financed, and 0.01per cent under the DisCo Financed framework.

On the metering progress under NMMP, MAP, Vendor and DisCo finance, the report stated that under MAP framework, a total of 168,397 meters were installed in 2023/Q2 representing a 5.92 per cent increase compared to the 158,992 MAP meter installations recorded in 2023/Q1 as Ikeja DisCo recorded the highest number of installations (47,080) representing 27.96 per cent of the total number of customers metered under the framework during the quarter, noting that Yola DisCo did not record any installation under the framework in 2023/Q2.

The report revealed that Abuja, Ibadan, Ikeja, and Port Harcourt DisCos have exhausted their meter allocations under the NMMP Phase 0. It further stated that there was no change in the number of meter installations by Benin, Enugu, and Kano DisCos while Eko, Ibadan, Jos, Kaduna and Yola DisCos reported a decrease in customer metering under the NMMP in 2023/Q2 compared to 2023/Q1, noting that the decrease was due to the winding down of NMMP Phase 0.

Abdul, in a presentation at the conference, said: “Based on international standards of 1 GW (1000MW) to one million people, the country is expected to at least generate 200GW (200,000MW) to give the population better access to electricity.”

According to her: “Nigeria has the capacity to generate 12.5GW (12,000MW) of electricity, but owing to different reasons, the 29 generation companies (GenCos) are only able to generate, transmit and distribute between 3GW to 5GW (3,000MW to 5,000MW)”.

She said that Nigeria, which is Africa’s most populous country with over 200 million people, faces surging electricity demand owing to rapid urbanisation and industrialisation.

She said before 2023, there were 26 gas-powered plants and three hydro plants, but the approval of 11 new GenCos in 2023 has taken the country’s electricity generating plants to 40.

According to her, the current transmission wheeling capacity is about 8.1 GW (8,100MW). She expressed hope that the new electricity Act would pave way for more investment into the sector, thereby, allowing states to generate, transmit and distribute own electricity.

On the metering gap, stakeholders in the industry have emphasised that the two per cent change in the metering rate barely scratches the surface of the country’s metering needs.

Executive Director, PowerUp Nigeria, Adetayo Adegbemle, said the number of unmetered customers would continue to increase. He pointed out that to close the gap, sustainable policy has to evolve and a continued maintenance of the required level of installations.

“Funds and unsustained policy are the bane of metering in Nigeria. The MAP Regulation has not been able to bridge the gap, hence, we need to evolve an infrastructure investment fund and seek out investors that are able to provide the massive funds for metering,” he said.

Similarly, Executive Coordinator, NEPA WAHALA NG, power sector consumer awareness and protection initiative, Emeka Ojoko, said the two per cent change is abysmal as no penalties were built into the MAPR 2018 to motivate DisCos in keeping to the timeline.

He added that the reasons for the low increment are not too implausible as the takeoff of the second phase of NMMP has been unduly delayed.

“The DisCos are unable to keep to the timelines for meter installation after customers have paid for them, World Bank loan for meter procurement and installation has been delayed due to well-founded objections by local manufacturers about the structure of the bidding process, hence, combination of these factors is responsible for the current situation,” he said.

Currently, Egbin has the highest capacity as a gas plant to produce 1.39GW (1,390MW), and Kainji Jebba Power Plc has the highest capacity as a Hydro plant to produce 1.33GW (1, 330MW).

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Michael Maren
Michael Maren
Former marine biologist who likes to spend as much time in the tropics as possible, due to a horrible time I once had in Alaska. Brrrr.

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