[size=18pt]We Will Resist Privatisation Of Electricity[/size]

Wednesday, 08 December 2010 01:41 Moses John, Abuja



Vice President of Public Service International Africa, (PSI) Comrade Peters Adeyemi has said that privatization of Electricity in Nigeria would not guarantee steady power to households but would rather lead to a regime of tariff increase for the consumers.

He said rather than the planned privatization, government should provide investments needed to stimulate the economy for rapid growth,saying this would impact directly on all households in the country .

Adeyemi who doubles as the deputy president of NLC and the general secretary of Non Academic Staff of Nigerians Universities (NASU) made this known at the PSI Africa and Arab Countries strategic think-tank meeting in Abuja yesterday.

According to the union leader, a recent World Bank study of investment in electricity and other infrastructure in Africa shows that private companies provide only 10 percent of total investment in the sector and that all of that is in Independent Power project (IPP).


http://www.leadershipeditors.com/ns/index.php?option=com_content&view=article&id=20870:we-will-resist-privatisation-of-electricity-&catid=16:headline-news&Itemid=102

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They say that when your surroundings are unsuccessful in what they are doing, in order for you to be successful you do the opposite. If government control of electricity has been unable to provide us with light since the beginning of the countries existence, I see no reason why trying something new would hurt. What could go wrong, the privatization of electricity causing us to have to steady power or power period? But them what would be the difference of that and now? hmmm.

Here is an article suggesting that we'll need $100 Billion to get to 40,000 MWH:
http://www.vanguardngr.com/2010/12/power-nigeria-needs-100bn-to-attain-40000mw-ptfp/


Where the hell is the money going to come for this? The Nigerian gov't cannot afford it. We need private capital, private investors if we want power in the country.

Alright, here is a screenshot of a powerpoint presentation I googled. Basically, generating electricity requires enormous amounts of cash. If we keep it in the hands of the gov't, it will never happen. It needs to be privatized so people have a profit incentive to come up with the billions of dollars required. If gov't managed, the gov't will underfund it and mess it up.

http://i55.tinypic.com/v33iv4.png

EDIT: Here is a link to the (Lagos-specific) powerpoint I saw this in: http://www.cbcglobal.org/CBCG_Library/AYO%20Gbeleyi,%20Power.ppsx

DapoBear, take am easy o! Thought I Ws disgusted by d guys senseless talk until I saw rave. Pele o! Dt shows how selfish and vile our people r, oyinbo man is not our problem but our very evil minded selves.

homerac7:

DapoBear, take am easy o! Thought I Ws disgusted by d guys senseless talk until I saw rave. Pele o! Dt shows how selfish and vile our people r, oyinbo man is not our problem but our very evil minded selves.

I apologize for cursing and edited my initial post.

The problem is the guy is a slowpoke. Or doesn't do research, have common sense. If electricity is not working and has never worked while under government management, why should anyone believe that the gov't continuing to run it will bring about progress?

Can somebody please put a gag tape around Comrade Adeyemi's mouth in the public interest?





Statist, socialist policies have failed us spectacularly. Now is the time to allow the private sector to take charge of Nigerian development.

chyz:

[size=18pt]We Will Resist Privatisation Of Electricity[/size]

Wednesday, 08 December 2010 01:41 Moses John, Abuja



Vice President of Public Service International Africa, (PSI) Comrade Peters Adeyemi has said that privatization of Electricity in Nigeria would not guarantee steady power to households but would rather lead to a regime of tariff increase for the consumers.
http://www.leadershipeditors.com/ns/index.php?option=com_content&view=article&id=20870:we-will-resist-privatisation-of-electricity-&catid=16:headline-news&Itemid=102

What makes him think it won't guarantee steady power? I think it will. If it's privatised and the company does not supply electricity, you simply stop paying. They lose out. So they'll try as much as possible to provide steady light. Besides, I don't think many people would mind increased tariffs as long as there is constant electricity.
As long as it's still in the hands of the government, they'll have nothing to lose. It'll simpy be another avenue true which more money can be stolen.
Is it not even a shame that we provide electricity to other nations and we don't have it.


He said rather than the planned privatization, government should provide investments needed to stimulate the economy for rapid growth,saying this would impact directly on all households in the country.
What does that have to do with electricity?
How much has the gorvernment already "invested"? What has it yielded? Man should go and sit down with the money he has stolen. Rubbish. Even if new "investments" impact positively on all households, it simply means more people will have money to spend on generators, inverters and whatnot which is not great for the environment.
That is IF any average household gains from it.
PS: What is NLC?

This MYTO (multi year tariff order) seems to be 95% of the problem:

http://234next.com/csp/cms/sites/Next/Home/5534749-146/story.csp

Basically, the price of electricity is capped at something ridiculously cheap like 4.3 cents (6.31 Naira) per KWh, and is only allowed to increase slowly over time.

The base cost to produce electricity is likely double or triple that amount, probably something like 15 Naira per KWh. This seems to be the major reason there is no power in the country. Whenever a good or service is sold at less than cost, there will always be a shortage.

Independent Power Projects, like the one Lagos did, for some reason they have to sell their power to the national grid rather than using it themselves. I guess they are forced to sell to the grid at this price which is cheaper than production cost.

I still think that electricity needs to be privatized. But even more than that, MYTO needs to be gotten rid of, ASAP. That way, selling electricity in Nigeria can be profitable (or at least you can break even.)

If Lagos State for example didn't have to follow MYTO and could set their own price for electricity, there will be 24 hour electricity in the state very rapidly. They could just expand their existing IPP project to cover the needs of their state. Their IPP is based on natural gas, so you could buy natural gas from the Niger Delta (or from overseas, if the militants start blowing up stuff.) The Lagos State government could then sell the electricity effectively at cost to its citizens, knowing that this would boost the economy.

Why is the Nigerian gov't so incompetent?!?!

"Comrade" Adeyemi better be warned. NLC is trying too hard to make themselves the new enemy of the Nigerian public.

They better be careful not to provoke people to violence, because when we finally have some semblance of movement in the country (even though, still little), fools addressing themselves with stup!d titles like "comrade" wake up and start farting through their mouths. We will fight them down.

The guy is not speaking for Nigerians.

How can you dare resist a move in the right direction?

What is the outcome of all the billions of petrodollars that have been spent on the sector?

Privatization is the way forward or we will just be making the same mistakes over and over again.

That guy should just shut up! Its obvious he is a part of the problem.

Even if electricity tarrif shoots up by 200% and is available 24/7, its more cost effective than running generators for only 6 hours daily!

Its happened before in the telecoms industry and unless it happens in the energy sector, we are going no where.

What is he doing about the lawmakers' unjustifiable allowances? Nonsense!

DapoBear:

Here is an article suggesting that we'll need $100 Billion to get to 40,000 MWH:
http://www.vanguardngr.com/2010/12/power-nigeria-needs-100bn-to-attain-40000mw-ptfp/


Where the hell is the money going to come for this? The Nigerian gov't cannot afford it. We need private capital, private investors if we want power in the country.

Alright, here is a screenshot of a powerpoint presentation I googled. Basically, generating electricity requires enormous amounts of cash. If we keep it in the hands of the gov't, it will never happen. It needs to be privatized so people have a profit incentive to come up with the billions of dollars required. If gov't managed, the gov't will underfund it and mess it up.

http://i55.tinypic.com/v33iv4.png

EDIT: Here is a link to the (Lagos-specific) powerpoint I saw this in: http://www.cbcglobal.org/CBCG_Library/AYO%20Gbeleyi,%20Power.ppsx

I seriously doubt that figure. I read the source you quoted. Papers should stop pulling figures from thin air. Yes It will be expensive and in the billions of dollars to get 40000mw, but nowhere near 100billion dollars.

we will resist non privatization of electricity too, it must be privatized, we Nigerians support it

Increased tarriff? oh pls, like the Generators don't already cost us too much. People have lost their lives cos of generator fume and we spend so much money on diesel.

Sky Blue:

I seriously doubt that figure. I read the source you quoted. Papers should stop pulling figures from thin air. Yes It will be expensive and in the billions of dollars to get 40000mw, but nowhere near 100billion dollars.

Nah, looks pretty legit (minus my typo of MWH instead of MW.) Coal and natural gas prices have soared it appears, bumping up the price to like $2-3k per KW:
http://www.nytimes.com/2007/07/10/business/worldbusiness/10energy.html?_r=1

So $2 or $3 per watt, 40K MW, , roughly $100 billion seems reasonable.

I strongly dislike this 10 year plan the article has in mind, that is too pessimistic and slow.

If you empower the state of Lagos to provide electricity for itself and charge market rates, I think they can do it in 3 or 4 years. They already have an IPP project (http://www.aes.com/aes/index?page=country&cat=NG) that generates 270 MW through 9 gas-power barges (7% of the nation's supply.)

Not quite clear how much this can be scaled up (perhaps for technical reasons one cannot go from 9 barges to 40 or 50 barges), but at least in theory I really think that Lagos could supply all of its own power needs (other states might have difficulty getting foreign investors to supply the billions in capital required, Lagos on the other hand doesn't have this type of problem.)

That is, assuming that Lagos could charge its citizens fair value (or slightly above) for the electricity generation. Unfortunately, due to moronic federal government policies, Lagos (or any other state) is not allowed to do this. . .

Comrade Peters Adeyemi, i'm ready to pay 5 times the amount i currently churn out to keep my generator running for constant electricity.

They say that when your surroundings are unsuccessful in what they are doing, in order for you to be successful you do the opposite. If government control of electricity has been unable to provide us with light since the beginning of the countries existence, I see no reason why trying something new would hurt. What could go wrong, the privatization of electricity causing us to have to steady power or power period? But them what would be the difference of that and now? hmmm.

@chyz,
this adeyemi of a man may look silly before every nigerian EXCEPT ME. the number one responsibility of every govt is to provide basic armenities to the citizenry so if our govt cannot provide us with electricity, what else are they governing?
if we allow the privatisation of electricity, it is as good as finished. if there is anything due for privatisation now, it is aso rock.
if jonathan thinks he cannot handle this, let him resign because millions of nigerians can including me. this idea of continuing privatisation from where obasanjo stopped will encourage these thieves to sell nigeria to themselves paying with our funds to themselves.
nigeria has no airline, lagos raods are sold to tinubu, no telecommunication owned by govt, now our electricity will be sold to jonathan and he will pay us back with our money. soon, the air we breathe will be pay as u go under the privatisation madness.
if only jonathan will be man enough to fight those who stole our funds, even $100 billion will be nothing to raise.

@1025: Right now, electricity from PHCN is sold at 1/2 of the cost it costs to produce. Of course, there is never enough electricity, since nobody wants to sell someone for less than it costs (would you like to sell pounded yam at half the cost it costs you to farm it, for example? Obviously not.)

So my question for you is, would you like to keep buying this 1/2 price electricity (roughly 6 Naira per KWh) from the PHCN, but for only 6 hours a day? Or pay slightly above the cost to produce it (say 15 Naira per KWh), and have it guaranteed for 24 hours a day? Note that if you stay with PHCN and keep using your generator, you are likely paying 25 KWH or something similar by using your gen. Not to mention maintenance costs, etc, etc.

this adeyemi of a man may look silly before every nigerian EXCEPT ME. the number one responsibility of every govt is to provide basic armenities to the citizenry so if our govt cannot provide us with electricity, what else are they governing?

you have missed it completely - does govt the west provide electricity, telephony, water, gas, or are these done by private companies?

more to the point, to rehash a peeve i have repeatedly spammed any power topic with

i have three generators and an inverter (which has its own issues) - i have recently replaced one of these generators; another refused to start last night.

i have been telling myself i will get earplugs when turning them on - i'm sure its affecting my hearing

when i came in at 10pm last night i had to change the oil of one of the generators


i have four upses , one of which needs its batteries replaced


i have several stabilizers

i have gone through one inverter and 2 three sets of batteries. i am strongly contemplating replacing the inverter i have.

i spend 6000 or more a week on petrol

i also spend undetermined figures on engine oil, spark plugs and servicing

i do not have an air conditioner, because that will imho necessitate buying a much larger generator

all of this is happening because those incompetent, thieving idiots in phcn have held us to ransom for so long

as an electrical engineer, it is particularly galling. when we have power issues in the close they call the electrical engineer to meet with phcn. as an informed profssional, having to listen to their bs is beyond galling - we need to replace this cable at 40,000; and you know the cable is alright, costs 20k at most and is in their store  - but you challenge them and they start the typical oho you want to teach me my job?

privatize phcn and free up my cash. take my issues and multiply them and you can imagine what phcn is doing to industry in nigeria. generator costs fuel costs maintenance costs power protection costs failures due to surges etc.

i seriously doubt if privatisation of phcn can come to 40k / month and wasted man hours buying petrol, troubleshooting, changing spark plug, checking house for what is tripping off the inverter, waiting for generator technician, swearing when phcn blows an appliance , running on gen becuase phcn is delivering overvoltage . . .

Vice President of Public Service International Africa, (PSI) Comrade Peters Adeyemi: i dont want to believe that this man is in nigeria. let him leave the increase in tariff to us to pay. We need light. We all know how much we spend on diesel and petrol to run our generators daily. The new tariff can never be more than that monthly.

We need regular electricity supply for now. He's one of the people that are frustrating the effort of the FG to get PHCN privatized. GOD will take him out of the place for people to enjoy regular electricity.

i think u nigerians should take the comrades advise!we have tried it here in ghana and it did not work. a private monopolist only thinks about profit and not efficiency. privitasation of electricity in ghana only brought price hykes and absurd inefficiencies.

its like saying we will resist progress

T

nkoso:

i think u nigerians should take the comrades advise!we have tried it here in ghana and it did not work. a private monopolist only thinks about profit and not efficiency. privitasation of electricity in ghana only brought price hykes and absurd inefficiencies.

in most developed countries electricity is privatised and there is fierce competion. Nigeria is too big to have just a player, and I think the govt can provide subsidy.

I support privatization, because it will bring about competitive prices and eventually a drop in cost of electricity and also a more stable supply of electricity, just like in the telecom industry,any provider that you feel offers better services at cheaper rates is who consumers would naturally patronize.

Why do people see privatization as a bad thing?

Government is supposed to concentrate on governance and not business. The reason why most governments delve into business it to prevent monopoly and provide subsidies of key socio-economic facilities.

But we all know that the aim is defeated here in Nigeria . . . There's just no avaiability in the power sector and resources are often diverted to makeshift/alternative sources of power supply.

Privatization will bring about availabitly and relative affordability . . . look what happened with NITEL!

The government has tried , they should make way for other to try!

I think these PHCN workers are just protecting their selfish interst!

DapoBear:

This MYTO (multi year tariff order) seems to be 95% of the problem:

http://234next.com/csp/cms/sites/Next/Home/5534749-146/story.csp

Basically, the price of electricity is capped at something ridiculously cheap like 4.3 cents (6.31 Naira) per KWh, and is only allowed to increase slowly over time.

The base cost to produce electricity is likely double or triple that amount, probably something like 15 Naira per KWh. This seems to be the major reason there is no power in the country. Whenever a good or service is sold at less than cost, there will always be a shortage.

The MYTO is NOT the issue, you need stable price signals going years into the future so you can do reasonable profit predictions and NPV calculations on a proposed investment.

You can’t simply move tariffs in one go or completely deregulate the market, because that will cause distortions in electricity provision - benefitting some and putting others at a disadvantage.

The prices need to go up, but in a predictable manner that will allow for increased investments.

The greater issue is determining the domestic gas price - if this price competitive, then IOCs will be more inclined to supply domestic power generation instead of seeking only to export.

Once that is settled, you can then set the MYTO working on the basis that gas/fuel costs make up say 40% of electricity costs and then set the tariffs accordingly.

Secondly, I don’t agree with the $100bn required to generate 40,000 MW.

Right now a 1,000MW CCGT costs ~£500m to build, so 40 of those will cost £20bn.

Add on another £10bn for transmission and distribution facilities and you have a total of £30bn, which comes out at roughly $45bn for 40,000 MW and not 100bn.

which comes out at roughly $45bn for 40,000 MW and not 100bn.

senators must to chop na

all of this is happening because those incompetent, thieving idiots in phcn have held us to ransom for so long

@oyb,
i read with pains ur points above and i was going to ask u if u have stolen my points. ur pians are exactly mine and that of many nigerians. among everyother points of urs, i choose to discuss the one on quote above.
uncle, do u believe that it is only in nigeria that everybody know Mr. B as a kidnapper, an armed robber and all that, yet he is a free man. in nigeria, tony annenih, obj and host of other politicians are known to be fraudulent yet they are freemen. if u ask jonathan today, tomorrow or next, he will openly tell u that the major problem of nigeria is corrupt leaders. if u and i know and jonathan knows even the police knows that a particular man is a criminal, what are we waiting for.
mtn is boasting till tomorrow that nigeria has been their largest market since inception, why? bcs we are corrupt and anything to make money and settle the top shots goes. i bought an mtn fast link and paid subscription for a connect that takes 5 hrs to open a page and am sure millions of nigerians fall for the same trap - corperate fraud.
show me a written confirmation/guarrantee that if we privatise electricity today, it will become stable in nigeria.
there is a word in economics called subsidy. this is the role a FG in protecting the citizens of a country when it comes to the price of basic armenities.
are we not blessed that our wether is friendly? in dubai, electricity and airconditioners are not luxry but necessities. ppl die of heat and all that.
assuming we privatise this phcn, what will be the percentage of ppl who will afford this prices?
are u telling me that if our president is not corrupt, he will be friendly with a corrupt governor? as long as aso rock is corrupt, every sector including phcn will remain corrupt wether privatised or not.
if u happen to be a worker with phcn and u know that a senator goes home at the end of every month with N15.9m allowances not inclussive, will u be happy to be going home with N9,000?
obasanjo made our senators to over earn just for his selfish intentions of buying them over on third term.
we have water boardthat gets part of our yearly budgets but u and i know that they only exist on papers.
how can a country live and exist on privatised products and how is our aso rock a govt house and what responsibilities will be theirs.
our roads are privatised, our airlines are privatised,telecommunications is in the same lane, soon and i mean soon, nigerian police army and navy will all be privatised.
in all, as long as corruption is institutionalised in nigeria, privatisation of the air we breath will never be a solution.

DapoBear:

@1025: Right now, electricity from PHCN is sold at 1/2 of the cost it costs to produce. Of course, there is never enough electricity, since nobody wants to sell someone for less than it costs (would you like to sell pounded yam at half the cost it costs you to farm it, for example? Obviously not.)

So my question for you is, would you like to keep buying this 1/2 price electricity (roughly 6 Naira per KWh) from the PHCN, but for only 6 hours a day? Or pay slightly above the cost to produce it (say 15 Naira per KWh), and have it guaranteed for 24 hours a day? Note that if you stay with PHCN and keep using your generator, you are likely paying 25 KWH or something similar by using your gen. Not to mention maintenance costs, etc, etc.

You know that's precisely why what such basic amenities are meant to be provided by the government.

They are partly paid for by tax payers's money funds generated from the contry's natutal resources (through the government budget). It's not purely a commercial institution and should not be charge as such.

If we are not going to enjoy subsides from the government then we might as well throw it open for the private sector to handle, at least we'll then be sure of constant supply!

1025:


@oyb,
i read with pains your points above and i was going to ask u if u have stolen my points. your pians are exactly mine and that of many nigerians. among everyother points of urs, i choose to discuss the one on quote above.
uncle, do u believe that it is only in nigeria that everybody know Mr. B as a kidnapper, an armed robber and all that, yet he is a free man. in nigeria, tony annenih, obj and host of other politicians are known to be fraudulent yet they are freemen. if u ask jonathan today, tomorrow or next, he will openly tell u that the major problem of nigeria is corrupt leaders. if u and i know and jonathan knows even the police knows that a particular man is a criminal, what are we waiting for.
mtn is boasting till tomorrow that nigeria has been their largest market since inception, why? bcs we are corrupt and anything to make money and settle the top shots goes. i bought an mtn fast link and paid subscription for a connect that takes 5 hrs to open a page and am sure millions of nigerians fall for the same trap - corperate fraud.
show me a written confirmation/guarrantee that if we privatise electricity today, it will become stable in nigeria.
there is a word in economics called subsidy. this is the role a FG in protecting the citizens of a country when it comes to the price of basic armenities.
are we not blessed that our wether is friendly? in dubai, electricity and airconditioners are not luxry but necessities. ppl die of heat and all that.
assuming we privatise this phcn, what will be the percentage of ppl who will afford this prices?
are u telling me that if our president is not corrupt, he will be friendly with a corrupt governor? as long as aso rock is corrupt, every sector including phcn will remain corrupt wether privatised or not.
if u happen to be a worker with phcn and u know that a senator goes home at the end of every month with N15.9m allowances not inclussive, will u be happy to be going home with N9,000?
obasanjo made our senators to over earn just for his selfish intentions of buying them over on third term.
we have water boardthat gets part of our yearly budgets but u and i know that they only exist on papers.
how can a country live and exist on privatised products and how is our aso rock a govt house and what responsibilities will be theirs.
our roads are privatised, our airlines are privatised,telecommunications is in the same lane, soon and i mean soon, nigerian police army and navy will all be privatised.
in all, as long as corruption is institutionalised in nigeria, privatisation of the air we breath will never be a solution.

^^^^

the telecoms industry is a clear example of the benefits of privatisation

competition and accountability

i can still remember queuing outside nitel phone booths to make international phone calls and receiving phone calls in a neigbours house.

when mtn came on board - sims were 15k, chrges were per minute. today a sim is 150n and there are all sorts of plans - why - competition!

as long as the industry is fully deregulated, we will all benefit immensely, as it is competition. we will also be able to hold the power companies liable.

to be fair to phcn, it is their distribution workers, especially those in lagos that are really corrupt.

the fg has failed woefully as far as phcn is concerned.

most of those nepa workers want things to continue as is. who wants to be accountable?

Ujujoan:

You know that's precisely why what such basic amenities are meant to be provided by the government.

They are partly paid for by tax payers's money funds generated from the contry's natutal resources (through the government budget). It's not purely a commercial institution and should not be charge as such.

If we are not going to enjoy subsides from the government then we might as well throw it open for the private sector to handle, at least we'll then be sure of constant supply!

is that 'i pass my neigbour' you bought during the fuel scarcity still working

^^^
Telecoms is a lot easier to privatize.
There is fixed infrastructure in power (distribution network), that has to be controlled by somebody aligned with the national interest. In telecoms, there's only regulation required. No 'distribution'.
But I am sure you know all of that.

oyb:

^^^^

the telecoms industry is a clear example of the benefits of privatisation

competition and accountability

i can still remember queuing outside nitel phone booths to make international phone calls and receiving phone calls in a neigbours house.

when mtn came on board - sims were 15k, chrges were per minute. today a sim is 150n and there are all sorts of plans - why - competition!

as long as the industry is fully deregulated, we will all benefit immensely, as it is competition. we will also be able to hold the power companies liable.

to be fair to phcn, it is their distribution workers, especially those in lagos that are really corrupt.
the fg has failed woefully as far as phcn is concerned.

most of those nepa workers want things to continue as is. who wants to be accountable?

PHCN on it's own is a failure. They should be able to checkmate corruption in their establishment.

It's this 'government work' metality that's their problem. That's why they should be allowed to rest!  

is that 'i pass my neigbour' you bought during the fuel scarcity still working

It is oh my broda . . .  

Although i've spent more than the cost price replacing random parts and making repairs brought about by wear and tear.

Kai, what's taking that milloniare hubby so long