The Federal Government in a
bid to curtail the epileptic
power situation in the
country has spent about N5
trillion ($31.45 billion) from
1999 till date. But it has only
been able to increase the
country’s electricity
generating capacity by about
2,500 mega watts over the
last 14 years.
This is a far cry compared to
its peers — South Africa and
Brazil. Brazil recorded an
investment of $58 billion in
its power sector between
1994 and 2008, while it
currently produces about
100,000MW of electricity.
South Africa on the other
hand, currently produces
about 40,000MW of
electricity, with plans to
invest additional $37 billion
over the next couple of years
to triple current capacity.
Investments in power since
1999
Between 1999 and 2013,
Federal Government’s
budgetary provisions for
power stood at N2.8 trillion
of which over N2.326 trillion
went into the National
Integrated Power Projects,
NIPP and various power
intervention projects.
Specifically, yearly allocations
as contained in statistics
from the Budget.
However, these
appropriations do not
include investments by state
governments, who have
since been co-opted to
intervene in their localities to
improve the power supply
situation, as according to the
Nigerian Constitution, Power
is exclusively the preserve of
the Federal Government.
Recalled that the House of
Representatives in 2008,
confirmed that the Federal
Government approved the
sum of N2.544 trillion ($16
billion) for the power sector
between 1999 and 2007,
which led to a public outcry,
as there was hardly anything
to show for it, as the lights
got dimmer instead of
brighter.
The uproar led to further
investigations in which it
was discovered that only
able to disburse N2.067
trillion ($13 billion) was
disbursed in the eight year
period, representing more
than 81 percent funding.
Also, a Presidential Review
Panel on the National
Integrated Power Project,
NIPP, in a presentation to the
National Economic Council,
NEC, in 2009, revealed that as
at 2007, the NIPP got N1.627
trillion, plus the N318 billion
Federal Government’s
counterpart funding for the
Mambilla Hydro Power
project, and N222.6 billion
($1.4 billion) for additional
nine turbines.
The panel however revealed
that only N489.72 billion
($3.08 billion) was funded
and scrutinised with advance
payment guarantees from
first class Nigerian banks and
Letters of Credits issued by
the Central Bank of Nigeria,
CBN. It also stated that over
N238.5 billion ($1.5 billion) of
the sum was still in the
custody of the banks as at
then.
In addition, Mr. James Olotu,
Managing Director/Chief
Executive Officer, Niger Delta
Power Holding Company,
NDPHC, last year disclosed
that the Federal Government
is spending N1.26 trillion on
10 National Integrated
Power Projects across the
country.
He said about N492.4 billion
($3.12 billion) was budgeted
for the first phase of the
project, which started in
2006 and ended in 2007.
This allocation covered seven
power projects, while N920
billion ($5.82 billion) was
budgeted to be utilized in
the second phase starting
from 2007. Olotu further
disclosed that the funds
were kept in the custody of
JP Morgan and the Central
Bank of Nigeria, CBN, while
N882.4 billion had been
disbursed to the NDPHC till
date.
According to him, four of the
projects had been
completed, while six others
are at various stages of
completion. He said; “In
totality, Nigerians have
contributed $8 billion to
build 10 power generation
plants, which after
completion, will give a total
of 4,774MW.
“We are also building
substations, transmission
and distribution lines, as well
as gas pipelines to ensure
that the plants get gas when
they are completed.”
He listed the completed
projects as:
Omotosho in Ondo State –
451MW
Alaoji, Abia State – 1,074MW
Sapele, Delta State – 451MW
Olorunsogo, Ogun State –
750MW
Those close to completion
are:
Ihovbor power project in
Edo State – 451MW
Geregu, Kogi State – 434MW
Egbema, Imo State – 338MW
Gbarain, Bayelsa State –
225MW
Omoku, Rivers State –
225MW
Calabar, Cross River State –
561MW
Concerns over funds’
utilisation
Despite the huge budgetary
provisions, the House of
Representatives’ Committee
on Power still expressed
concern over the poor
utilisation of funds
appropriated for the sector.
Mr. Patrick Ikhariale, the
Committee Chairman
disclosed that whereas the
sum of N75 billion was
appropriated less than half
or N34.7 billion or 46
percent was released to the
Ministry of Finance, while
only N19.7 billion (56
percent) was utilised by the
Ministry of Power.
He argued that this implies
that the Ministry did not
require as much funding as
it demanded, especially as it
lacked the capacity to
implement its capital budget.
This contrasts sharply with
constant claims by the
ministry that the country
required at least $10billion
annually for 10 years to get
power right.
*PHCN transformer
*PHCN transformer
2,500MW added since 1999
Despite these huge
investments, Nigeria has only
been able to increase its
electricity generating
capacity from about
2,000MW in 1999 to about
4,500MW as at today.
There appears to be no end
in sight to the sufferings of
Nigerians as power supply
remains epileptic at an
average of between three to
four hours daily.
Equally, industries,
particularly the small and
medium scale, SME sub-sect
have closed shop on account
of lack electricity to power
their operations. Even
businesses in operation
record their highest
operating costs from
electricity, as many invest in
multiple generating sets to
run their tools.
Commenting on the funds
allocated to the power sector
and its impact on power
generation, Mr. Michael
Olawale-Cole, President and
Chairman of Council of the
Nigerian Institute of
Management, expressed
concern that despite the
huge allocation to the sector
over the years, power
generation is yet to record
significant improvement.
He said, “Government’s
sundry attempts at
generating adequate power
for the nation in the recent
past have ended disastrously
what with the scandals of
monumental
misappropriation of funds
that trailed the various NIPPs
across the country.
“There is no guarantee that
the situation is going to
change for the better in the
near future,” adding that
“the country seems to be at
crossroads with the issue of
power generation at the
moment.”
He argued that “Once the
issue of power generation
and distribution is resolved,
the nation’s firm match to
greatness will be
guaranteed.”
Underscoring how critical
power is to economic
growth, Prof. Rahamon Bello,
Vice Chancellor, University of
Lagos, lamented that in spite
of the abundant energy
resources in the country and
significant government
investments in the sector
over the last ten years,
electricity supply remains a
serious challenge to Nigeria’s
socio-economic
development.
He said majority of Nigeria’s
power infrastructure were
built in the 1970s and 1980s
and due to a freeze in
investment in the sector, lack
of maintenance and
adequate expansion of the
facilities over the years,
Nigeria had to contend with
epileptic and erratic power
supply.

According to him, as at
today, less than 50 per cent
of Nigeria’s population has
access to the national grid
due to inadequate
transmission and
distribution networks.
Impact of power on
economic development
Steady power is essential for
national development,
especially as it positively
influences socio economic
activities as well as the living
standard of citizens.
In addition, ageing and
poorly maintained
infrastructure, weak network
configuration and
overloaded transformers,
result in frequent system
collapse, high transmission
and distribution losses
among others.
Analysts are of the view that
lack of access to electric
power, and modern energy
in general, also has a
negative effect on
productivity and has limited
the economic opportunities
available to developing
countries including Nigeria.
This, they said, is
compounded by the poor
state of existing
infrastructure, which creates
the dual challenge of finding
resources for maintenance
of existing facilities and also
to build new power plants.
They contend that improving
access to modern energy is a
necessary condition for
boosting growth and
reducing poverty in not only
Nigeria but Africa in general.
In comparison to other
countries, Nigeria’s installed
capacity is grossly
inadequate. As at 2010, only
about 3,700 megawatts was
available for a population of
140 million people due to
various reasons including
gas supply constraints,
inadequate maintenance of
equipment that stems from
procurement constraints,
dearth of skilled
maintenance personnel and
the dependence on imports
of parts and foreign experts
to carry out repairs and
overhauls.
Bello, who is a Professor of
Chemical Engineering, noted
that in 2000, power
generation capacity was as
low as 1,500MW, due, mainly
to lack of investment in
maintenance and expansion
programmes on existing
power plants.
Way forward
Even as the implementation
of the Power Sector Reform
Programme is well advanced,
Bello called for appropriate
commercial framework to
support private investments
to the sector.
He maintained that to
proceed with the reform
programme, it is necessary
to develop a comprehensive
action plan to holistically
implement the programme
as encapsulated in the
Electric Power Sector Reform
Act, EPSRA, 2005
He further advocated for a
feasible incentive scheme
backed by policy to
encourage private sector
investment in generation
and distribution.
“Financial institutions and
market systems that will
support power procurement
between generation
companies and distribution
companies should be put in
place. Empowerment should
be given to the office of the
market operator to
commence shadow trading,”
Bello added.
On his part, Olawale-Cole
said, “It is a common
knowledge that Nigeria has
been backward in the areas
of successful start-up
businesses, Small and
Medium Enterprises (SMEs)
and industrialisation
generally which are the core
catalysts for real national
development due to poor
power generation.
“Many companies have
continued to operate at just
break-even point and below
installed capacity while the
ones that cannot cope under
the harsh operating climate
occasioned by ever-
mounting overhead costs
have since closed shop or
relocated to smaller
neighbouring countries
where there is steadier
power supply.”
He also reiterated that
security is key to future
investments in the economy,
while calling on the citizenry
to support government’s
efforts in order to move the
country to the next level.
http://www.vanguardngr.com/2013/04/fg-invests-n5trn-in-2500mw-power/

PDP, POWER TO THIER POCKET.

That is roughly 31 billion US dollars if am not mistaking. At least by now our power supply should be stable and constant.

Kudos to the PDP!!!

.

Black Mamba: Ok...but am i the only person seeing the outlook of this post like a poem?

IT IS A POETIC NEWS FROM VANGUARD.
BUT, DON'T BOTHER TO MEMORISE THE POEM.
DOESN'T WORTH IT. OK?

Dem don milk this country

the govt also needs to invest in the health sector, but in the meantime, overseas hospitals can continue providing care as needed ie to nigerians in need of it.

lord have mercy.

God will help nigeria.

The amount of money spent on electricity generation in nigeria is partially proportional to the megawatt of power generated and inversely proportional to the amount distributed.