Naija Brand Ambassadors TM is a nationwide promotional, and event staffing company founded to satisfy the demand for a professional agency to attend to every possible detail of events and promotional staffing in Nigeria.
Due to the demand of our clients, we are presently looking out for hundred elegant male and female talents to join our staffing team. Emerging talent must be 5.7 to 6fit with model in shape. If you are out there, join us on Saturday the 15th of June 2013, for a job briefing by 10am at 2, Oyetola Idowu Street, Off Sura-Mogaji Coker Road Ilupeju Lagos. (Lagos alone).Please all emerging talent must look hot.No Nigeria Time.
For more information visit www.naijabrandambaasadors.com.ng or call 08078745298.

Naijabrandambassadors is a nationwide promotional and event staffing company managed by Kobo Productions Ltd to satisfy the demand for a professional agency to attend to every possible detail of event and promotional staffing. We combine our close working relationship with thousands of students and graduates with our strong presence across university campuses, to drive our unique Graduate Recruitment offering. Presently, there are several opportunities available for people who are interested in putting their skills to work as event professionals.
Our Event Staffing division is in need of experienced event staffers to provide support in various venues as:

EVENT MANAGERS (Male & Female Nationwide)
Major Responsibilities Include:
• Pre-event coordination and orientation
• Management of supplies and equipment
• Management of team at event
• Event set-up and management of screening software and other equipment
• Supervision of on-call and vendor staff
• Communication and coordination with client representatives and post-event activities
• The ideal candidate will have five years of previous experience in managing corporate and promotional event within multi-location with project management experience.
• Commitment to continuous quality and efficiency improvement and a team -oriented collaborative model.
• Anticipates upcoming challenging interactions and how to best respond.
• Demonstrated ability to manage numerous events within a state and ensure deliverables at the highest quality level including supply management, staff management, and logistical management.
• Must be able to engage team and ensure appropriate staffing at all events.
• Demonstrated level of trust to maintain privacy and abide by Naija Brand Ambassadors policies and to be able to work in an autonomous and branch location.
• Must be a positive role model for the client, staff, and vendors.
• Must be a problem solver and thrive in solution-driven thinking.
• Must have dependable transportation and willingness to travel and work some weekends.
Educational Requirement
All applicants must be a graduate with anticipated event marketing, management and project management experience
If you have the required experience and believe you have what it takes to excel in this position, please submit your cover letter and resume. This position is a contractual position with an anticipated length of up to 9 months. No phone calls please. Naija Brand Ambassadors promotes diversity and an environment of inclusion.

EVENT ACCOUNT/RELATIONSHIP MANAGERS (Nationwide)
The role: To manage profitable, prestigious client events, using staff and other resources in the preparation, planning and delivery. Globally exceeding client business objectives and expectations. To identify new opportunities and leads for existing and new business development, working with the Account Director to expand the client portfolio.
Client Liaison and Development
• Assist the Account Director in the implementation of the Account Development Plan
• Liaise with and advise clients, using knowledge and event experience to ensure that their business objectives are met
• Build, maintain and develop long term relationships with clients
Overseeing Project Management
• Ensure that the highest standards of event planning and delivery are maintained through the effective management of Event Managers and Event Coordinators
• Work with the Account Director to add value to clients’ events through advising on beneficial additional services; creative ideas; business solutions and negotiation with 3rd party suppliers in order to achieve maximum contribution
• Ensure usage of client and company processes and procedures within business units, resulting in consistency and standardisation in delivery of all events organised through streamlining working methods
• Ensure the effective usage of in-house project management systems and processes and the application of client driven systems such as Starcite, AgoraLive and C-vent
• Assist the Account Director in the preparation of comprehensive and informative written proposals for existing and new clients with support from Sales and Marketing where necessary
• Produce, manage and circulate key communications e.g. weekly status reports to all key meeting stakeholders e.g. client, exhibit agency, etc
• Ensure delivery of all events in accordance with regulatory and client-defined compliance guidelines
The ideal candidate:
• Ideally you will have 3-5 years experience from within an agency environment
• You'll be an established account manager or relationship manager from the events industry
• You will have strong staff management experience - managing event staff
• Experience of managing events internationally and nuances of working in different countries / cultures
• Experience of managing room blocks and hotel contracts
• Experience in preparing after event reports.
Other vacancies include:
1. CORPORATE BRAND EVENT STAFF (Nationwide)
2. SALES PROMOTERS/PRODUCT SAMPLERS (Male & Female Nationwide)
3. CORPORATE EVENT SECURITY GUARDS (Male & Female Nationwide)
4. EVENT MASCOT STAFFS (Male Nationwide)
5. EVENT PHOTOGRAPHERS (Nationwide)
6. EVENT EMCEES/COMEDIAN (Nationwide)
7. CORPORATE MODELS (Male & Female Nationwide)
8. AFTER PARTY EVENT CLEANERS (Nationwide)
9. EVENT DJ’S
If you have the required experience and believe you have what it takes to excel in the above positions, please submit your cover letter and resume to naijabrandambassadors@gmail.com or summit by hand to 2,Oyetola Idowu Street Off Sura Mogaji, industrial Estate Ilupeju Lagos. This position is a contractual position with an anticipated length of up to 9 months. Naija Brand Ambassadors promotes diversity and an environment of inclusion. Position (1, 2, 3, 6, and 7) requires you to attach a full picture of yourself. All application must be submitted on or before 20th of April, 2013

Naijabrandambassadors is a nationwide promotional and event staffing company managed by Kobo Productions Ltd to satisfy the demand for a professional agency to attend to every possible detail of event and promotional staffing. We combine our close working relationship with thousands of students and graduates with our strong presence across university campuses, to drive our unique Graduate Recruitment offering. Presently, there are several opportunities available for people who are interested in putting their skills to work as event professionals.
Our Event Staffing division is in need of experienced event staffers to provide support in various venues as:

EVENT MANAGERS (Male & Female Nationwide)
Major Responsibilities Include:
• Pre-event coordination and orientation
• Management of supplies and equipment
• Management of team at event
• Event set-up and management of screening software and other equipment
• Supervision of on-call and vendor staff
• Communication and coordination with client representatives and post-event activities
• The ideal candidate will have five years of previous experience in managing corporate and promotional event within multi-location with project management experience.
• Commitment to continuous quality and efficiency improvement and a team -oriented collaborative model.
• Anticipates upcoming challenging interactions and how to best respond.
• Demonstrated ability to manage numerous events within a state and ensure deliverables at the highest quality level including supply management, staff management, and logistical management.
• Must be able to engage team and ensure appropriate staffing at all events.
• Demonstrated level of trust to maintain privacy and abide by Naija Brand Ambassadors policies and to be able to work in an autonomous and branch location.
• Must be a positive role model for the client, staff, and vendors.
• Must be a problem solver and thrive in solution-driven thinking.
• Must have dependable transportation and willingness to travel and work some weekends.
Educational Requirement
All applicants must be a graduate with anticipated event marketing, management and project management experience
If you have the required experience and believe you have what it takes to excel in this position, please submit your cover letter and resume. This position is a contractual position with an anticipated length of up to 9 months. No phone calls please. Naija Brand Ambassadors promotes diversity and an environment of inclusion.

EVENT ACCOUNT/RELATIONSHIP MANAGERS (Nationwide)
The role: To manage profitable, prestigious client events, using staff and other resources in the preparation, planning and delivery. Globally exceeding client business objectives and expectations. To identify new opportunities and leads for existing and new business development, working with the Account Director to expand the client portfolio.
Client Liaison and Development
• Assist the Account Director in the implementation of the Account Development Plan
• Liaise with and advise clients, using knowledge and event experience to ensure that their business objectives are met
• Build, maintain and develop long term relationships with clients
Overseeing Project Management
• Ensure that the highest standards of event planning and delivery are maintained through the effective management of Event Managers and Event Coordinators
• Work with the Account Director to add value to clients’ events through advising on beneficial additional services; creative ideas; business solutions and negotiation with 3rd party suppliers in order to achieve maximum contribution
• Ensure usage of client and company processes and procedures within business units, resulting in consistency and standardisation in delivery of all events organised through streamlining working methods
• Ensure the effective usage of in-house project management systems and processes and the application of client driven systems such as Starcite, AgoraLive and C-vent
• Assist the Account Director in the preparation of comprehensive and informative written proposals for existing and new clients with support from Sales and Marketing where necessary
• Produce, manage and circulate key communications e.g. weekly status reports to all key meeting stakeholders e.g. client, exhibit agency, etc
• Ensure delivery of all events in accordance with regulatory and client-defined compliance guidelines
The ideal candidate:
• Ideally you will have 3-5 years experience from within an agency environment
• You'll be an established account manager or relationship manager from the events industry
• You will have strong staff management experience - managing event staff
• Experience of managing events internationally and nuances of working in different countries / cultures
• Experience of managing room blocks and hotel contracts
• Experience in preparing after event reports.
Other vacancies include:
1. CORPORATE BRAND EVENT STAFF (Nationwide)
2. SALES PROMOTERS/PRODUCT SAMPLERS (Male & Female Nationwide)
3. CORPORATE EVENT SECURITY GUARDS (Male & Female Nationwide)
4. EVENT MASCOT STAFFS (Male Nationwide)
5. EVENT PHOTOGRAPHERS (Nationwide)
6. EVENT EMCEES/COMEDIAN (Nationwide)
7. CORPORATE MODELS (Male & Female Nationwide)
8. AFTER PARTY EVENT CLEANERS (Nationwide)
9. EVENT DJ’S
If you have the required experience and believe you have what it takes to excel in the above positions, please submit your cover letter and resume to naijabrandambassadors@gmail.com or summit by hand to 2,Oyetola Idowu Street Off Sura Mogaji, industrial Estate Ilupeju Lagos. This position is a contractual position with an anticipated length of up to 9 months. Naija Brand Ambassadors promotes diversity and an environment of inclusion. Position (1, 2, 3, 6, and 7) requires you to attach a full picture of yourself. All application must be submitted on or before 20th of April, 2013

THE FG AND PHCN FACE-OFF
By: Nigeria Tribune
THE Minister of Power, Professor Barth Nnaji recently shed more light on the impasse between the Federal Government and the workers at the Power Holding Company of Nigeria (PHCN) over the issue of their severance pay. He, according to the reports, even threw barbs at the workers, calling them outlaws who were bent on getting what did not belong to them.
The Minister had been addressing the press after the ministerial briefing of President Goodluck Jonathan on the performance of the 2012 budget during which he dismissed the claim that the government was planning to pay the PHCN workers the sum of 85,000 naira across board. He noted that too much falsehood had been peddled about government’s position on the matter.
ACCORDING to the Minister: “That has to do with how much they are going to take. They say it is N85, 000. I cannot understand how they could say that. Many of the people who are junior officers, some of them with WASC qualification are going to go home with N8 million. Somebody who is in the position of an Assistant General Manager could go home with N28 million. What we are saying is that there is a range. The highest officer could go home with N38 million.”
This revelation about the outlandish and generous severance pay for the workers of a government company that has successfully riled the people of this country over the years with poor performance or non-performance will definitely rile the people further. It even seems to confirm the people’s cynicism about the inconsistency in the reward system in which diligence, performance and productivity are not necessarily given due consideration. In a manner of speaking, the minister was right on target when he called the PHCN workers outlaws bent on getting what did not belong to them.
APART from that, Professor Nnaji had averred to the fraud on the claims of contributory pension fund in which money was deducted from workers’ salaries on the pretext of paying it into their retirement account but which was never done. The demand of the PHCN workers for the payment of 25 per cent of the benefit at the point of severance had been predicated on these deductions which the government had found to be an absolute falsehood. The Minister also said that a panel, headed by a former Auditor-General of the Federation, had been set up by the government to investigate the deductions which were not remitted into the account.
THERE are two fundamental issues which derive from the Minister’s revelations. The first has to do with the huge severance pay that will eventually accrue to workers of an organisation that has unarguably failed the country, most especially against the backdrop of decayed infrastructure and its reverberating effects on employment. PHCN without any doubt contributed immensely to the de-industrialisation of Nigeria, the relocation of several factories and therefore the upswing of youth unemployment and criminality. PHCN also once had the distinction of being listed as a leading company in the country’s corruption index.
It simply is absurd to imagine that the workers of such an organisation will be going home with such a golden handshake having dealt the country and its people a deadly blow. Since the company is being privatised, should the people not be worried that the jumbo severance pay will not be transferred to them through the sale of the company’s assets and liabilities to private concerns? What positive hints can such transactions give other workers, especially in the unorganised private sector, who invariably bear the brunt of the lapses so committed? It is instructive that the workers have not reacted to the minister’s claims about their jumbo severance pay since his press briefing.
THE second issue is about the criminal conversion of the deductions from the workers’ salaries. This has become a common practice in Nigeria for which people are rarely punished. Deductions that are expected to be for cooperative unions and government’s taxes indicated on the pay slips rarely get to their approved destinations. At the point of severance, both through foreclosure or retirement, the workers become victims of financial scams and they are grateful to receive their entitlements less the deductions that had been made during their active years. This is callous and should not be allowed.
Elsewhere, people go to jail for such offences and it is because perpetrators of this crime have not been brought to book that the practice has become so rife. Examples should be made of those who pinched the deductions at PHCN after the investigative panel must have completed its job to deter others from the crime of criminal conversion which such a crime amounts to.

10/10/10.

Chief Emeka Wogu
Hon Minister of Labour,
2nd Floor (257-237), Block4A
New Federal Secretariat Complex,
Shehu Shagari Way
Central Area, Abuja
Sir,
RE: LEGAL OPINION ON NATIONAL UNION OF ELECTRICITY EMPLOYESS (NUEE) ET AL VS. BUREAU OF PUBLIC ENTERPRISES (BPE) SC.62/2004.
I am providing this legal opinion in response to your request during the last meeting which you had with the Labour Committee of the Presidential Taskforce on power (PTFP). For ease of reading, the opinion is broken into 6 headings; (1) Facts of the Case (2) Decision of the court (3) Legal implication of NUEE’s action of embarking on, or even threatening to embark on strike (4) Immediate action that Government should take (5) The issue of Sanction by International Labour Organization(6) Conclusion.
1. FACTS:
The facts of the case are very simple. Precisely, BPE went to Court in January 2002, to challenge the NUEE’s alleged constitutional right to go on strike in protest against, and in challenge of the BPE’s power to execute the Power Sector Reform process which was then contained in National Electric Power Policy but now delineated in the Electric Power Sector Reform Act (EPSRA) 2005. It is pertinent to note here, that the strike by NUEE on August 25, 2010 as well as their continued threat of strike action was based on their opposition to the implementation of the Electric Power Sector Reform Act which entails the privatization of PHCN.
The BPE’s prayers before the court were as follows:
(i) “(1) A declaration to the effect that …..Neither the National Union of Electricity Employees, nor any of its members, they together being collectively and in combination, a body of persons engaged in the provision of an essential service within the meaning of Section 47 of the Trade Disputes Act and of Section 9(1) of the Trade Disputes (Essential services) Act, Cap 432 and Cap 433 respectively of the Laws of the Federation 1990, is entitled either to contrive, or the declare, or to embark upon, or to proceed with, or to implement and carry into subsistence and effect any strike action ….. without first pursuing, fulfilling, exhausting and otherwise ensuring strict compliance with and faithful adherence to all the strict mandatory procedures/conditions precedent prescribed by all the Federal Legislation currently prevailing and in force……before they may be at liberty, lawfully to declare and embark upon any prospective or threatened strike action of any sort.

(ii) “(2) An order of perpetual injunction restraining Mr. Precious kiri-Kalio, the 2nd Defendant above Qua General Secretary and also restraining all other functionaries or persons whomsoever who either occupy or at any other previous relevant time have occupied either offices, portfolios or positions of authority/responsibility on or within the executive organs of the National Union of Electricity Employees the first (1st) Defendant sued from giving any further instructions, or issuing any further directives, or passing and implementing any further resolutions or from effectuating any other measures and otherwise from taking any steps, or any further steps of all and any kinds to cause ,or to instigate, or to compel, encourage and persuade or in any other manner to enable all or any members of the National Union of Electricity Employees anywhere throughout Nigeria to carry the threat of proceeding with and embarking upon a nation-wide strike from Monday 7th January 2002 or as from any other earlier or later date into implementation, force and effect unless and until after they have first pursued fulfilled and exhausted and otherwise ensured strict compliance with and faithful adherence to all diverse Federal Legislations currently prevailing and in force in regulation of the Lawful conduct of ‘essential service’ Trade Union or alternatively unless and until otherwise directed by specific Court Order. (underlining mine for emphasis)

(iii) “(3) A further Order of perpetual injunction directed against all members of and against every member of the National Union of Electricity Employees the first Defendant sued in these proceedings wherever in Nigeria such member or members of the within named Union may presently be, restraining them all from acting upon or from acting in compliance with, or from acting in obedience to any instructions ,directives or resolution given, issued, passed or taken for any purpose or objectives that do

(iv) or may pertain to ,or that do or may be connected with ay prospective strike action with the consequential effect of withholding or withdrawing them from the performance of their usual daily job, duties and likewise restraining them all by any other means, whatsoever from carrying the threat of proceeding with and embarking upon a nation-wide strike action…..unless and until directed by specific court order.”


2. DECISION OF THE COURT.
The court of first instance (trial court) struck out the case on the ground that it had no jurisdiction to entertain the action. Upon appeal to the Court of Appeal Lagos, the Appeal court reversed the decision of the trial court, granted the relief sought by BPE and ordered the perpetual injunction as requested. The Supreme Court upheld the decision of the Court of Appeal. The Supreme Court categorically found that “the instant disagreement as to privatization of NEPA cannot constitute a trade dispute between the parties”.
The most telling part of the Supreme Court judgment is contained at pages 42 – 43 of the judgment and I would rather prefer to reproduce same verbatim:
“Coming to the instant matter, the 1st defendant/appellant is more or less the sole provider of Electric Power a crucial essential service to the whole nation. The chaos and total confusion talkless of the economic damage that would be inflicted on the people and the nation as a whole should the 1st defendant/appellant as the sole provider of Electric Power proceeded on an industrial action/strike could only be imagined. Such an action if not checkmated timorously would bring the entire nation to its economic knees and standstill. To allow that stage to be reached would, with respect, amount to unpardonable naivety. It is in this light that the Trade Disputes(Essential Services ) Act had to be promulgated to empower the President to proscribe any Trade Unions or Associations whose members have embarked in threatening industrial unrest/strike actions that would otherwise tend to and thus disrupt the running of any of the essential services mentioned in the said Act.” (Underlining added by me for emphasis.)
3. LEGAL IMPLICATION OF NUEE’S ACTION OF EMBARKING ON, OR EVEN THREATENING TO EMBARK ON STRIKE.
Once an injunction is issued, it must be obeyed unless and until such an injunction is discharged. The injunction was issued by the Supreme Court(the highest court of the nation) against all members of NUEE and the General secretary of NUEE from carrying out “the threat of proceeding with and embarking upon a nation-wide strike from Monday 7th January 2002 or as from any other earlier or later date into implementation, force and effect unless and until after they have first pursued fulfilled and exhausted and otherwise ensured strict compliance with and faithful adherence to all diverse Federal Legislations currently prevailing and in force in regulation of the Lawful conduct of ‘essential service’ Trade Union or alternatively unless and until otherwise directed by specific Court Order.” The perpetual injunction is binding upon the current general secretary of NUEE, Mr. Joe Ajaero as well as all members of NUEE. The said injunction is still in full force as no “specific Court Order” has directed otherwise.
When NUEE embarked upon nation-wide strike on August 25, 2010 (eve of the Power Road Map launch in Lagos) they violated the perpetual injunction for the following reasons:
(a.) Section 48 of the Trade Dispute Act, Cap T8 (the Act) defines “trade dispute” to mean any dispute between employers and workers or between workers and workers, which is connected with the employment or non-employment, or the terms of employment and physical condition of work of any person”

(b.) The Supreme Court found that disagreement regarding Electric Sector Reform and Privatization of PHCN does not constitute a trade dispute. See page 27 of the judgment.

(c.) Assuming arguando, that there is a trade dispute, Sections 4, 6,7,8,9, 17 and 33 of the Act prescribed a detailed procedure that must be complied with before resorting to strike. Where the detailed procedure is complied with but the dispute still remains unresolved, which is unlikely, there is a requirement of a notice of at least 15 days to be given by workers in essential services before ceasing work. Failure to abide by this requirement carries a punishment of imprisonment for 6 months or fine or both.

(d.) It is undoubted that NUEE did not comply with any of required procedures before embarking on strike and continuing to threaten strike action. It must be noted here that the sections above referred to gave the Ministers of Labour wide powers to drive the process of complying with the procedures which are the conditions precedent to any strike.
The appropriate thing to do would have been for the Chief Law officer of the Federation, the Attorney General, (AG) to institute a contempt proceeding against the General Secretary of NUEE and other relevant officers. The AG however did not take any action until NUEE purged itself of the contempt by calling off the strike. However, because the perpetual injunction prevented NUEE from threat of proceeding with and embarking upon nation-wide strike, NUEE is presently in violation of the injunction to the extent that it has continue to issue threats of embarking upon nation-wide strike. Worse still is the fact that the reason for the threatened nation-wide strike is NUEE opposition to the implementation of the EPSRA which necessitates the privatization of PHCN, formerly NEPA.


4. IMMEDIATE ACTION THAT GOVERNMENT SHOULD TAKE.
The AG should without delay, issue a strong statement warning the General Secretary of NUEE, all relevant officers and all members of NUEE to desist forthwith ,from any further violation of the outstanding perpetual injunction unless and until they have complied with the strict conditions precedent.
Such warning must make it clear that the highest court of the nation has pronounced that the disagreement as to privatization of PHCN, or any other public utility company for that matter, does not constitute a trade dispute and therefore, cannot be the basis for threatening or embarking upon strike. It obvious that the Mr. Ajaero does not know that his action constitutes a violation of law or that he knows but is proceeding because he believes that the government has slept on its rights.
The Minister of Labour should invoke his right under the Act especially sections 4 through 9, and call the NUEE and its leadership to order and ensure that they comply with all the relevant laws as strict conditions precedent to embarking on industrial action.
5. THE ISSUE OF SANCTION BY INTERNATIONAL LABOUR ORGANIZATION
The International Labour Organization (ILO) is specialized agency of the United Nations which deals with labour issues. Membership of ILO is thus limited to nation-states. ILO is thus a creature of international law.
Nigeria is member of ILO but Nigeria is a sovereign state and as such, under the principles of Sovereignty in International law, ILO cannot interfere in the domestic affairs of Nigeria as sovereign state. Law making and law enforcement of any nation is a domestic affair. In the instant case, ensuring compliance with the judgment of the highest court of Nigeria is, without doubt, a domestic affair which is entirely within the purvey of municipal law of Nigeria.
The ILO has a constitution that is binding on all her member nations. In case of violation of the constitution there are well set out procedures of dealing with such issues without interfering with the domestic affairs of any nation.
6. CONCLUSION:
The present Federal Government of Nigeria has made power delivery its priority. It has come to terms with the fact that the realization of its dream, as far as power delivery is concerned, requires implementation of the Electric Power Sector Reform Act to the letter and it has demonstrated that it has the will to carry it through. It is a fact of common knowledge that PHCN as presently constituted, is reeking with corruption and that no meaningful progress can be made without privatizing PHCN. It is obvious also that in order to continue its culture of corruption, at the expense of giving light to the masses of Nigeria, some persons who stand to benefit from the status quo are hell-bent on frustrating the federal government’s effort.
Section 1 of the TRADE DISPUTE (ESSENTIAL SERVICES) Act Cap. T9, Laws of the Federation of Nigeria, 2004 empowers the President to proscribe any trade union or association which is employed in essential services that engage in acts calculated to disrupt the economy or act calculated to obstruct or disrupt the smooth running of any essential service.
Section 2 of the above referred Act prescribes a fine of up to N10, 000.00 and or imprisonment for a term of six months for any person found guilty of an offence under subsection 1.
The federal government should pay serious attention to the pronouncement of the Supreme Court: “The chaos and total confusion let alone of the economic damage that would be inflicted on the people and the nation as a whole should the 1st defendant/appellant as the sole provider of Electric Power proceeded on an industrial action/strike could only be imagined. Such an action if not checkmated timorously would bring the entire nation to its economic knees and standstill. To allow that stage to be reached would, with respect, amount to unpardonable naivety. It is in this light that the Trade Disputes(Essential Services ) Act had to be promulgated to empower the President to proscribe any Trade Unions or Associations whose members have embarked in threatening industrial unrest/strike actions that would otherwise tend to and thus disrupt the running of any of the essential services mentioned in the said Act.”(underlining added by me for emphasis.)
It is likely that if the Attorney General of the federation issues a warning in line with my suggestions in “4”above those who are bent on disrupting the Power Sector Reform will understand that their game is up and hence cease and desist. If however they are so foolhardy as to persist in their nefarious acts, the big hammer, proscription, should be wielded.

Very truly yours,

__________________________________________________
Hon. Nick O. Agbo Esq. LLM (Labour Advisor)
SPA to Prof. Bart Nnaji, FAS, FAEng, NNOM, CON
{Special Adviser to the President on Power,
Chairman, Presidential Task Force on Power (PTFP)}

Nigeria’s power generation reaches record 4,477mw
15 August 2012, Sweetcrude, ABUJA –POWER generation in Nigeria has reached a record 4,477.7 megawatts, mw, with 170mw being kept in the reserve.
News of the highest ever power generated in Nigeria was broken Tuesday by Mr. Ogbuagu Anikwe, a spokesman of the Power Minister, Prof Barth Nnaji.
The new generation level is 240.7mw higher than the peak 4,237mw achieved on August 6.
A statement by Anikwe quoting Nnaji, said the good news in the latest development is that “every power generated is wheeled comfortably” as against the situation in August, 2010 when the country generated 3,800mw for the first, but “the system collapsed within a few minutes because the transmission infrastructure was poorly maintained.”
Former PHCN executive director and former chief executive officer of the Egbin Power Station in Lagos, Mr Simeon Atakulu, said of the latest development: “It is significant that the new record in generation has been set even with the 1,320mw Egbin plant, the nation’s biggest power generator, doing only 600mw because it is undergoing routine maintenance.
“This means we have a spare power capacity of over 300mw.”
The new output increase is from the 600mw-capacity Shiroro Hydro Station in Niger State, which was falsely reported by a section of the media at the weekend to have been shut by junior electricity workers, allegedly protesting unresolved issues over the privatisation of the Power Holding Company of Nigeria, PHCN.

Has the Missing N270bn PHCN Pension Been Traced?
BY: BENEDICT ALLI
Recent investigation shows that there are indications that the missing Superannuation fund of the Power Holding Company of Nigeria (PHCN), formerly known as National Electric Power Authority (NEPA), which has cause controversies between the Federal Government and the organised labour under the auspices of the Nigeria Labour Congress (NLC) and National Union of Electricity Employees (NUEE) over the missing superannuation funds earmarked for pension payment of staff of Power Holding Company of Nigeria (PHCN) May have been diverted to a seemingly illegal entity called the NEPA Superannuation Fund Limited.

According to the article publish by Ameto Akpe on business day; ‘the electricity sub-sector has been in the news over the last few weeks, following disclosures by the Federal Government that over N270 billion PHCN staff pension scheme fund was missing. PHCN’s Superannuation Fund, captured within the NEPA Act, was to be made up by 25 percent contributions of staff salaries and is managed by the PHCN management and the leadership of the three unions in the sector, who are the trustees and sole signatories to the account.

Documents seen by Business Day dated 9th September 2005 and signed by directors of the Superannuation Fund Limited, showed that a special resolution given during an extraordinary meeting of the board of directors of the group states, “that all Acts, Deeds and Negotiations, Contracts, Agreements and Transactions entered into, carried out and being undertaken by and for NEPA superannuation fund, prior to the incorporation of NEPA superannuation fund limited, be and is hereby ratified.

“That all such Acts, Deeds, Negotiations, Contracts, Agreements and Transactions are henceforth the Acts, Deeds, Negotiations, Contracts, Agreements and Transactions of NEPA Superannuation Fund Limited and shall be of the same effect as if NEPA Superannuation Fund Limited had been a party to it in the place of NEPA Superannuation Fund.”

Meanwhile, Corporate Affairs Commission documents dated 7th July 2005, show that the Superannuation Fund Limited was registered by some individuals within NEPA with its directors listed as Timothy Olufemi Akintola of NEPA, Ijora-Olopa in Lagos with 1.4 million ordinary shares; Vincent Mamudu of Yaba, Lagos with 1.3 million ordinary shares and Moses Olaniyi Olotu of NEPA quarters, Ijora, Lagos with 1.3 million ordinary shares. PHCN is listed as being allotted 6 million ordinary shares.

Other documents from the three other unions in the power sector, namely the Senior Staff Association of Statutory Corporations and Government-owned Companies, National Union of Electricity Employees (NUEE) and the PHCN National Union of Pensioners, had respectively nominated Akintola, Mamudu and Olotu to “subscribe, on behalf of the Association of NEPA Superannuation Fund Limited and should equally hold, on behalf of the association NEPA Superannuation Fund Limited, shares allocated to the union.”

Notably, no clear evidence has so far emerged that either the Bureau of Public Enterprises (BPE) or the ministries of power and finance, which may represent the government, are aware of the existence of Superannuation Fund Limited or if any of them were represented in any of the related transactions.

The government has said that it doubts the workers’ union and the management ever deducted the 25 per cent from workers’ salaries and therefore may have for many years been doing creative accounting to be able to pay those who have hitherto retired from the service.

Bart Nnaji, the minister of Power notes that “it is clear from the reports I have, that it is either the PHCN staff did not contribute 25 percent of their salary or that some unscrupulous officials made away with over N300b which was over the years deducted from their pay”.

Nnaji said that if the PHCN’s 50,000 employees had over the years been contributing 25 percent of their salaries to the pension, as alleged by the National Union of Electricity Employees (NUEE) they should have over N300billion in their bank account.
“What we have rather found, is a paltry N3billion, which cannot cover the terminal benefits of up to 30 percent of the workforce”, said Nnaji.

In the absence of funds to implement the Superannuation Scheme, the government has ruled that rather than go home with nothing, the workers should revert to the Pension Reform Act and be paid from there.

To this end, the Government is said to be withdrawing taxpayers’ money from the treasury to pay for the PHCN and its 50,000 workforce, the outstanding 15 percent of its pension premiums, under the Pension Reform Act, with effect from July 1, 2004.
The total fund withdrawn by government for this exercise is pegged at N80billion’’.

MINISTER ASKS NGOS TO LOOK INTO PHCN PENSION FUNDS

By: Ogbuagu Anikwe
Special Assistant ((media) to Minister of Power

The Minister of Power, Professor Bart Nnaji, has requested leading Civil Society Organizations (CSOS) in the country to look into the management of the funds of the Power Holding Company of Nigeria (PHCN) staff pension scheme.
The public scrutiny to be led by the CSOs, according to the minister, has become imperative because of the “the huge amount of money which should be in the scheme but cannot be traced”.
If the PHCN 50,000 employees have over the years been contributing 25% of their salary to the pension as alleged by the National Union of Electricity Employees (NUEE), argued the minister, they should have over N300billion in their bank account.
“What we have rather found is a paltry N3b which cannot cover the terminal benefits of up to 30% of the workforce”, said Nnaji.
Even so, he explained, “the money came from PHCN internally generated revenue, rather than as a contribution from the PHCN staff towards their retirements”.
The minister said that “it is clear from the reports I have that it is either the PHCN staff did not contribute 25% of their salary or that some unscrupulous officials made away with over N300b which was over the years deducted from their pay”.
He hinged the call for a public scrutiny of the management of the pension funds on the need for values of probity, accountability and public morality.
Exonerating the Ministry of Power and the Federal Government from culpability in a possible fraud in the pension scheme, the minister stated that the funds were managed by only a group of trustees made up of the PHCN management and officials of the three trade unions in the PHCN “who are also the sole signatories to the bank accounts”.
Payment of severance benefits to PHCN employees in the wake of the privatization of 17 PHCN successor companies has pitched the leadership of the National Union of Electricity Employees (NUEE) against the government.
Despite the failure of the PHCN staff to contribute to the pension scheme, said the minister, the government has decided to pay them 25% of their salary up to June 30, 2004, when the law allowed the PHCN to operate a special pension scheme.
He added: “And in spite of the PHCN refusal to comply with the new Pension Reform Act which came into existence on July 1, 2004, and which requires each worker to contribute 7.5% of his salary to the scheme and his employer another 7.5%, the government has offered to pay the staff 15% of their salary from July 1, 2004, to June 30, 2012.
“We intend to take this money from the public treasury, that is, money belonging to Nigerian tax payers because we do not want the thousands of hardworking PHCN workers to retire into penury after several years of considerable contributions to national development”.
Prof Nnaji’s letter, written today, was addressed to the Save Nigeria Group led by Pastor Tunde Bakare, Civil Society Legislative Advocacy Centre run by Comrade Ibrahim Awaal Rafsanjani, Concerned Professionals headed by Professor Pat Utomi, Civil Liberties Organisation led by ,Civil Rights Congress of Nigeria headed by Comrade Shehu Sani, Law and Social Development Centre chaired by Bamidele Aturu, Institute of Human Rights and democratic Studies led by Dr Josephine Okei-Odumakin and the Transition Monitoring Group which comprises over 200 Non Government Organisations and led by Moshood Erubani who used to head the Campaign for Democracy.

Minister accuses union leaders of misleading PHCN workers[color=#990000][/color]

FROM MADU ONUORAH
Least paid worker to get N8m
THE Federal Government yesterday decried the conduct of union leaders in the electricity sector who are allegedly blocking ongoing reforms in the industry, lamenting that they are “constituting themselves as outlaws.”
Minister of Power, Prof. Barth Nnaji, told journalists after the presentation of the Ministry of Power 2012 budget performance to President Goodluck Jonathan that one is at a loss as to why the union leaders have been misinforming their members, blackmailing the Federal Government and manhandling senior management workers. He said it was lamentable that the union leaders were hiding that junior officers are to collect a minimum of N8 million while the highest rank will collect about N38 million.
Nnaji also said that the Federal Government has begun a probe of alleged fraudulent conduct in the execution of pension scheme in the Power Holding Company of Nigeria (PHCN) between 2004 and 2011, saying that the pension contribution of the workers were not remitted to any pension manager.
In the 2012 budget, a total of N75.5 billion was proposed for capital projects expenditure but the National Assembly upped it to N78 billion to accommodate the members’ constituency projects. Out of the N78 million, a total of N21.5 billion has been released while N11.4 billion out of it has been utilised. Hence the 52.9 per cent performance recorded.
Nnaji also assured that the improved electricity supply being experienced across the country now will be sustained even after the rainy season because the non-hydro power plants are now getting more gas to run them following the success of the emergency gas supply intervention initiative of both ministries of Power and Petroleum Resources.
Nnaji stated that new power plants, including those under the National Independent Power Project (NIPP) scheme like in Sapele, Olorunsogo, and Alaoji, will be completed and commissioned this year, while 2013 budget will see to the completion of studies on setting up coal powered plants in Kogi and Enugu states and hydro-power plants in Mambilla and Zungeru.
The Minister expressed regret that in the issue of labour, “there is a lot of distortions out there. It is unfortunate that they are not getting the proper information. But I can promise you that this week we are going to release a lot of information pertaining to the main issue, which the union is quarrelling with government. That has to do with how much they are going to take. They say it is N85, 000. I cannot understand how they could say that. Many of the people who are junior officers, some of them with WAEC qualification are going to go home with N8 million. We just do not want to publish tally sheet. Somebody who is in the position of an Assistant General Manager could go home with N28 million. What we are saying is that there is a range. The highest officer could go home with N38 million.


“So, anybody who is telling you N85, 000 has a different mission. The area of difference is the following: the Union wants to be paid 25 per cent of the benefit at point of severance. That was an old policy before the 2004 Pension Reform Act. After the Act, they continued to carry on with the 25 per cent. They collected this money without remitting the money into the account, it was just written on paper. So, the workers had nothing in their account. That is something we have now set up a panel to investigate and we have set up a panel headed by a former auditor general of the federation. It amounts to fraud to have that kind of thing going on.
“Secondly, the money that is being promised, workers are retired based on that. What government has decided to do is that since no money was paid into the account from 2004 to June of this year, government will pay what is in the law. Government will pay its own component that is the PHCN component of it. Workers were supposed to contribute 7.5 per cent and PHCN pays 7.5 per cent. But since PHCN did not pay, government will pay it. This makes 15 per cent. But the union is saying that they would like government to pay the 25 per cent. Every worker out there, be it private or public, follows the pension Act. And how on earth would you say you do not want to obey the law of this nation. That is the threat. We have said let us give you the tally sheet. They said no. Meanwhile, they go and talk about N85,000. This is a country of rules but they go and attack an official of PHCN, dragged her out and stripped her because the woman holds the position of Acting General Manager of Human Resources. Unions do not act this way. PHCN unions are constituting themselves as outlaws. It is not right.”
Nnaji gave insight into the 2013 budget plan, stating that, “we have the objective of having holistic implementation of the provision of the Electricity Power Reform Act of 2005 and then prioritise completion of ongoing projects

IS THE NLC WORKING FOR THE NIGERIAN PEOPLE?
By: B. Alli, Lagos
Source: Statement by Ministry of Power on the Threat by NLC to Disrupt Power Supply Nationwide

1. The Nigerian people are shocked at a statement credited to the President of the Nigeria Labour Congress (NLC) after a meeting on Thursday, August 9, 2012, in Benin, Edo State, threatening to stop power supply nationwide if within one week the Federal Government fails to accede to the demand of the National Union of Electricity Employees (NUEE).
2. NUEE, which is made up of junior workers, is demanding the withdrawal of security agents from all installations of the Power Holding Company of Nigeria (PHCN) across the country and the payment of 25% of salaries of workers which they claim have over the years been deducted from their pay as contributions to their pension scheme.
3. It is self-evident to all Nigerians that the respected NLC President was not properly briefed on the issues in question. Take, for instance, the deployment of security personnel since last September to PHCN facilities to assist police officers protect the assets worth billions of dollars and the people working there. The deployment was in the wake of increasing security challenges in the country. We are proud that events have since demonstrated that the President and Commander-In-chief of the Armed Forces was far-sighted in taking this step. All the nation’s electricity assets and personnel have gallantly and admirably been protected by our security agents.
4. Therefore, it is unacceptable and unpatriotic for any person to suggest that the soldiers be withdrawn. Indeed, Nigerians are happy that soldiers assist in guarding places of worship and major hotels.
5. As regards the payment of severance retirement benefits to PHCN employees, let it be stated without equivocation that there is no PHCN employee who contributed 25% of his or her salary to the pension scheme or any amount at all to the scheme up to June 30, 2004, when the PHCN was allowed by law to operate an in-house Defined Pension Scheme, that is, a pension scheme different from what generally obtained in the public service.
6. If there were contributions to the pension scheme by any PHCN personnel at all, they are not reflected in the books or bank accounts of the pension scheme. The trustees of the scheme are officials of the trade unions in the power sector and the PHCN management, who are the sole signatories to the bank accounts. The Federal Government has never been involved in the management of the PHCN Pension Scheme. In other words, if there is any case of fraud or misappropriation of funds, the workers should know those to be held responsible.
7. The PHCN trade unionists claim that as of June 30,2004, there was a total sum of N88billion in the pension account. This is far from the truth. The account has never had more than N3bilion. Civil society organizations are invited to verify the claim.
8. Despite the fact that PHCN workers did not contribute even one kobo to the superannuation fund, the Federal Government has accepted to pay the difference of N85billion in the amount of money the PHCN workers purportedly contributed to the pension funds up to June 30, 2004.
9. A new pension law has been in force since July 1, 2004. The law requires employees to open Retirement Savings Accounts (RSAs) with pension funds administration of their choice. The employee is required to contribute 7.5% of his salary to the savings account and his employer another 7.5%, thus bringing the total amount payable to the RSA to 15% monthly.
10. It is very regrettable that the PHCN, despite being a government agency, has yet to comply with this law, a whole eight years after the Pension Reform Act came into being. What the PHCN management has been doing is to set aside N3b every year from internally generated revenue to pay retiring staff members in flagrant violation of the Pension Reform Act. The PHCN has been paying the staff on the basis of 25% purportedly taken from their salary.
11. With a couple of employees retiring annually, the PHCN management was able to pay the staff severance benefits which led workers to assume that there were enough funds to settle their disengagement benefits. However, with the mass retirements occasioned by the privatization of 17 out of 18 PHCN successor companies, it has become crystal clear that there are virtually no funds to pay the retirement benefits of the almost 50,000 workforce.
12. To prevent a situation where several thousands of PHCN staff members would retire without much in their name after years of service to the nation, the Federal Government decided to pay the workers 15% of their salary, covering contributions by the employees and their employer, from July 1, 2004, to June 30, 2012, as part of the severance package. This offer has, however, been rejected by leaders of the trade unions who uncompromisingly insist on the payment of 25% of their salary.
13. The demand is very unrealistic because it is in gross violation of the 2004 Pension Reform Act . What is more, the PHCN workers never contributed any money to the pension scheme. The money the labour leaders are demanding as of right is from taxes and other contributions made by other Nigerians.
14. The respected NLC President is advised to not capitulate to the mindless propaganda of the NUEE leadership. On Wednesday, July 8 2012, for example, when the PHCN Chief Executive sent out an advisory note to each PHCN employee in respect of his terminal entitlements, the NUEE leadership used crude force to prevent PHCN employees from collecting the advisory letters, alleging they were termination letters! The next day, it increased the propaganda tempo by alleging that a mere N85,000 has been approved for the payment of each PHCN worker as his terminal benefit, whereas some of the employees will earn as much as N38m. This is more than 400% more than the terminal benefits of the chief executive of many a federal agency.
15. Earlier on July 23, 2012, when the Bureau of Public Enterprises signed a contract with Manitoba Hydro International of Canada for the management of the Transmission Commission of Nigeria, the NUEE leadership told the staff that the TCN has been “privatized through the backdoor” and that all the staff have been retrenched without the staff being paid their entitlements. Everyone knows that the TCN is the only PHCN successor company that will not be privatized but managed by a firm with a solid record, as provided in the 2005Electric Power Sector Reform Act and the 2010 Road Map for Power Sector Reform. There is, of course, no question of any person being retrenched at the TCN on account of the management contract with Manitoba, which has only eight expatriate executives with a little support staff to in Nigeria. The contract with Manitoba will last for only three years in the first instance; and Nigerian TCN employees are understudying them with a view to taking over as soon as possible.
16. Electricity supply has been improving considerably in the last three weeks, and the improvement will be greater in the weeks and months to come. Against this backdrop, it is difficult to dismiss with a wave of the hand the suggestion in some quarters that the labour leaders in the power sector who obviously are not happy at electricity improvement across the nation, are not really working for the PHCN staff but for the cabal and other entrenched interests in the sector feeding fat on the misery of the Nigerian people.
17. The NLC President should never acquiesce in the antics of the NUEE leadership which is using electricity workers as a cannon fodder to achieve a private agenda at variance with the interests of the Nigerian people who have endured decades of untold problems arising out of scandalously poor electricity supply.

ELECTRICITY IMPROVEMENT: ASSOCIATION COMMENDS NNAJI
Benny Atagame Alli
For keeping his promise of a considerable improvement in power supply across the country from July of 2012, the Minister of Power has earned the commendation of the National Association of Electricity Consumers of Nigeria (NAECN).
The NAECN national coordinator, Chief Ganiyu Makanjuola, gave the commendation in a statement today in Lagos.
Chief Makanjuola, an engineer and president of the Lagos State Branch of the Nigerian Ports Authority Pensioners Welfare, described the Minister of Power, Professor Bart Nnaji, as “a worthy Nigerian citizen and public officer who matches his promise with concrete action”.
According to the engineer, the minister had as early as April assured the nation of a considerable improvement in power supply from the middle of July because of the scheduled increase in natural gas supply from the Nigerian Gas Company, a subsidiary of the Nigerian National Petroleum Corporation (NNPC), and in the volume of water at the lakes in the nation’s three hydro power stations at Kainji, Shiroro and Jebba, all in Niger State.
Makanjuola stated that the quantum of power generated in the country has risen from about 3,200Megawatts of two weeks ago to 3,917.1MW as of July 30.
“This means that the nation is a heartbeat away from the historic 4,400MW it generated last January and which the national transmission grid was interestingly able to wheel effortlessly”, he remarked.
Giving a breakdown of how about a capacity of 700MW was recovered, the leader of electricity consumers said that the Shiroro power plant, which was working for only three hours in a day when the near drought in neighbouring countries like Mali resulted in low water levels at the dams, now generates 500MW from three units while Jebba generates 322MW from four out of six installed units because the fifth has been out of service for several years and the sixth undergoing retrofitting.
Mkanjuola noted that only 63MW is being generated from the 760MW Kainji station built in 1968 because of poor maintenance and praised Prof Nnaji for working in close collaboration with the World Bank to rehabilitate some of its units.
On the thermal plants, the engineer said that the improvement in gas supply has enabled the Power Holding Company of Nigeria (PHCN) facility at Olorunsogo in Ogun State to run four out of the seven installed units with each producing 38MW while that of the National Integrated Power Project (NIPP) generates 120MW from one of the four commissioned units.
He also said that the NIPP plant at Geregu in Kogi State now generates 140MW from two units and that of Omotosho in Ondo State produces 120MW.
“With the condensate problem in gas supply to the Sapele power plant in Delta State now being solved,” according to Makanjuola, “coupled with an increasing gas supply from the NNPC, the nation can only expect greater power supply across the nation in the near future”.
The NAECN coordinator observed that Prof Nnaji’s promise of a 1,000MW increase by the end of the year “is too conservative”, saying “studies we have carried out show that electricity supply will increase by 1,500MW which will bring the national output close to 6,00MW.
“In other words, the nation will have about 9,000MW by the end of 2013, doubling whatever we have generated in our national history thus far”.
Makanjuola praised efforts to improve the transmission infrastructure in recent times.
“The repair, rehabilitation and modernization of the transmission facilities have made it possible for the transmission infrastructure to have the capacity to transport 5,000MW., a long leap from August 2010 when the system collapsed under the weight of a mere 3,800MW

Nnaji defends privatisation of firms in power sector
THURSDAY, 02 AUGUST 2012 00:00 FROM MADU ONUORAH, ABUJA
THE Federal Executive Council (FEC) yesterday focused on briefings on the economy with the Coordinating Minister of the Economy and Minister of Finance, Dr Okonjo-Iweala, saying President Goodluck Jonathan’s economic reforms had received endorsement at a London Investment Conference which ended yesterday as foreign investors were scrambling to be part of the Nigerian economy.
At the Council session, chaired by Vice President Namadi Sambo, the “tremendous” positive response by international investors was indicative of the global confidence in the macro-economic policies of the Federal Government.
Minister of Power, Prof Barth Nnaji also explained that the privatisation of companies in the power sector is not just about giving it to the private sector to manage but a way of ensuring that the generating companies have the ability to serve powers to the distribution companies that are credit worthy.
Nnaji stated that unless the distribution companies were credit worthy, they would not be able to buy power from the generating companies that would defeat the goal of the transformation in the sector. He expressed regrets that none of the distribution companies were currently credit worthy.
At the close of bidding for power generation and distribution companies on Tuesday, which 79 firms showed interest, Nnaji said 25 of the bids were for generation and management of existing power plants while 54 were for power distribution and transmission.
Minister of Information, Mr. Labaran Maku, who declined to speak on the ongoing controversy between the executive and the National Assembly over the implementation of the 2012 budget, however, explained that the budgeting process was in itself problematic as the implementation of the budget actually started three months ago after it became a law in March.
Maku however assured that once procurement processes were concluded, many more projects would be awarded and result of execution of projects would be more visible.
The minister, who dwelt more on the briefing on the economy, told journalists at the end of the Council session, along with Nnaji, that “Council today took reports of some aspects of the progress being made in the economy. We decided to take a look and hear from ministers some departmental progress and to deliberate and see whether our country is going in the right direction or not.
“We got a major report, preliminary report from the investment conference that was held in London from Monday till today. The Coordinating Minister of the Economy, Dr. Ngozi Okonjo-Iweala reported to council that the about to be completed special investment conference on Nigeria which was put together by the Bank of Industry, in partnership with other institutions, has turned out to be one of those very surprising and indeed very positive reports of how the world is looking at Nigeria currently.
“According to the CME, and her report was also collaborated by several ministers who were also in London, the Conference brought together a number of leading international investors who were looking for the opportunity to invest in Africa. And from the comment and report of what took place in London, the CME told us that the world is very appreciative of the present reforms that have been taking place in Nigeria.”
Maku continued: “Specifically, she said global investors believe that the micro economic policies of Nigeria are currently some of the best in world. They believed that Nigeria’s economy is being run in a very convincing way and that because of the management of the economy and because of the reforms this administration is implementing, most investors believe that Nigeria is a destination for any significant investment in sub-Sahara Africa in decades to come.
“CME said the various MDAs that are lead sectors in economic reforms made presentations in England. The Ministry of Agriculture, Communication Technology, Works, and several other MDAs that deal with infrastructure made presentations to explain the opportunities that exist in our economy and also to explain the various reform policies that the government has been implementing over the years and that the feedback they have given council today is that the interests those investors have shown in the economy of Nigeria surpass the expectation of our own participants.
“The believe that if these reforms go on and given the kind of interest that they showed in London, people seeking to come here, people already investing in these sectors, it is very clear that Nigerian economy is heading in the right direction and that our macro economic policies are applauded,” Maku said.

IS PROF BART NNAJI A MAN OF HIS WORDS?
By Benny Alli
On Monday, Manitoba Hydro, a Canadian firm formally put pen to paper and signed a contract that will see it run TCN for the next three years in the first instance. This is a significant step. A giant step towards delivering on promises a man made some months ago.

Rewind back to the months of March, April and May, which saw a flurry of activities organised by the ministry of Power. Conferences, Town Hall meetings and events were held all in a bid to tell Nigerians that this time it is different. That this administration is ready to put sword to the neck of this hydra-headed monster called power outage and get it right for once.

Prof Nnaji, rather than send an aide embarked on this journey himself. Criss-crossing the length and breath of our dear nation. From Kano to Lagos he went and from Enugu to Sokoto he travelled. Putting his life on the line and his comfort to one side all in a bid to inform Nigerians about the holistic turnaround in the power sector the Nation is embarking upon. Always at pain to emphasise that it a journey of no retreat no surrender.

This made me sit up and take notice as I had never seen a government official embark on the kind of sensitization journey Prof Bart Nnaji went on in convincing us that a tariff review in prices we pay to PHCN is necessary and why privatization of generation and distribution is important. He went truly and above the call of duty and if he could had gone to the moon and back to make sure we got the information, he would had gone

He made series of promises about how things are being put in place; the investment by the government, and how the sector is attracting foreign investors from the World Bank and stakeholders from Brazil to Canada. His message then was that many of these investors, for the first time, has seen some sincerity in this administration commitment in getting the power situation right in Nigeria.

The dams not getting enough water because of low rainfall, shortage of gas supply to power some of the plants, he also cited as some of the problems.

He told us that from June, we would begin to see real improvement in generation and the impact of the process and that by December it would have increased dramatically

Some sector of the estate of the fourth realm in their characteristic pessimism turned up their nose and saw some of the statement as “another Government propaganda, a charade whose ember will not last the cold night. Some stopped short of calling him a liar

Fast-forward June 2012 and what I am seeing is convincing me that this man called Bart Nnaji is truly a man of his words.

Last night, a friend of mine sauntered into my apartment and in a serious tone, told me that he is very furious with Bart Nnaji. Why? I asked him. He looked at me like am wacko and said off-handedly. “That professor guy is beginning to teach my electronics how to work and they hadn’t been used to that kind of work.” How is Bart Nnaji responsible for your electronics working overtime? I asked casually. Now really worried for the mental health of my friend. He continued as if he didn’t hear me. “Prior to June, my refrigerator has been used to working only a few hours in a week, my AC could go days without working not to talk of my washing machine because there is no electricity to power them. But since last month, my refrigerator has been working non stop. Power only go out for a few minutes or 2 hours at most and is restored. Now my refrigerator and AC are made to do things they are not used to…and that Professor Nnaji is responsible because power has significantly increased. That’s when I got the joke and I went berserk with laughter.

This made me sit up and took a long hard look on my energy saver bulb, turned on the switch, smiled, shook my head and took another peek at my freezer which is doing what it is made to do…freeze….I turned to my friend and told him that he is right, we all have Prof Bart Nnaji to blame for making our electronics work overtime. We laughed out loud, grabbed some ice-cold beer from the fridge and went upstairs to relax

On a serious note, most of my friends and colleagues report the same thing. There is a general consensus that the man Bart Nnaji did not lie when he looked us in the eyes and told us that power will begin to significantly improve from the month of June. I live in Lagos and I am typing this using light graciously provided by PHCN and my computer has not gone off all day. My generator must be wondering if am broke as I have not powered it on for a few days.

This has given me hope for the future. With Manitoba Hydro taking over the running of transmission and no staff of TCN loosing their job, I am excited and now truly believe that every other event in the power road map will be executed.

NB: I read in the papers today that many companies had beaten the BPE deadline and submitted bids for the acquisition of the power plant. According to some papers, a total of 25 prospective investors have submitted technical and financial bids for the six electricity generation companies of the Power Holding Company of Nigeria, PHCN. The next stage of the privatization exercise, according to the spokesman of the BPE, Mr. Chukwuma Nwoko, will be the harvest of the bidders’ technical and financial proposals for distribution companies. It has July 31, 2012 as deadline.
The transaction timeline also reveals that the evaluation of the technical bids will take place between August 14 and 28, 2012. The National Council on Privatization, NCP, will approve the results of the technical evaluation on/or before September 11, 2012.
The deadline for the shortlisted bidders for generation companies to submit their letters of credit is September 18, 2012 while October 2, 2012 is for shortlisted bidders for distribution companies.
The BPE will, between September 25, 2012 and October 10, 2012, open the financial bids of prospective investors for the privatization of the successor companies.

My heart beats with excitement because the private sector involvement in power is the only thing that can give us a 24 hour power supply in this great country of ours

Successive government had sunk too much into the sector with too little to show for it. Issues of sabotage, corruption and the”no be my papa work” mentality had ruled for far too long. It is time to break the old order and Prof Nnaji, like my pastor will say “is in the spirit”. He has the will and determination to see this through.

We are not there yet and it not yet the pie in the sky moment we crave. But events of the past few days had convinced me that a high-speed train of events has been set in motion. A train that isn’t stopping until it reaches it final destination.


What other sector is crying for the intervention of Prof Bart Nnaji? Because as far as am concerned, he has set in motion the wheel for a sustainable improvement in power generation, transmission and distribution in Nigeria.

Now is Bart Nnaji a man of his words? The evidence is there for you to make an informed decision. What do you think? Please send us your comment via koboproductions@gmail.com

Benny Alli
Lagos

Government targets 13,500mw electricity generation
The federal government has said it intends to increase electricity generation to about 13,500 megawatts by 2013, as part of the medium term strategy to achieve stability in the power sector.
The minister of state for power, Nuhu Wya, said that in the short term, about 900 megawatts are from available assets. This is lower than the 16,000 megawatts projected in February 2010 by the former minister of power, Lanre Babalola.
Speaking at the annual power conference organised by Businessday Newspaper in Lagos yesterday, Mr. Wya said government is fully committed to achieving improvement in the power sector.
"An additional 4,500 megawatts will be generated with ongoing project while 3,300 megawatts will be generated by Independent Power Projects (IPP)," Mr. Wya said.
According to him, government has set aside N57 billion to settle seven years monetisation arrears of Power Holding Company of Nigeria (PHCN) workers.
"This is the largest commitment to any workforce by government so far, all in the bid to improve the erratic and unpredictable state of power supply," he further said.
The blueprint for the Vision 20:2020 projects that Nigeria would require about 60,000 megawatts in order to be among the top 20 economies in the world by the year 2020.
Barth Nnaji, chairman of the presidential task force on power, said since the present administration came in, about 1,000 megawatts have been added to the national grid, while there has been more stability in systems output.
"We have had only two incidents of systems collapse this year, unlike two to three that we used to record every month previously," Mr. Nnaji said.
Gradual progress
He disclosed that over 45 IPPs have been licensed while the bulk trader that would ensure that power generated by the private sector investors find ready market has been established.
According to him, the country was making gradual progress in the quest to make the power sector attractive to private investors.
"A year ago, a whole number of regulatory issues needed to be addressed. Last year, the regulatory commission was not in place, but now we are it is in place," he stated.
Sam Amadi, chairman of the Nigerian Electricity Regulatory Commission (NERC), said the commission was committed to working to guarantee that private monopoly does not replace the public monopoly that previously existed in the power sector.
He said the commission would copy power framework from other countries and adapt it to the Nigerian situation to ensure efficiency.
He also said new electricity tariffs would be released within the next two months.
"The tariff that would be announced would ensure that you (investors) recover all credible and allowable investment that would attract you to make investment in this sector," he said.
However, Mr. Amadi said there would be a public hearing on the tariff so that it could be challenged by investors and consumers.
Pragmatic reforms
According to Mr. Amadi, ongoing reforms in the power sector should be pragmatic and not ideological; adding that it could be misleading to assume that inefficiency would disappear once the private sector comes in.
"Put differently, privatising alone may not be the answer to the challenges in the electricity sector. The principal hidden problem that undermined public company could undermine the private companies, if the governance structure is not done right."
Appropriate structures need to be put in place to ensure that the power sector is run efficiently once the entire privatization process is concluded, he added.
"We should not waste anymore time cuddling the dead baby. If we have to liquidate the PHCN headquarters, we should do it. But we should not do so without taking care of the welfare of the workers," Mr. Amadi said.
The promise to generate more power has been made by governments since the return of the country to democratic rule in 1999. However, despite the billions of naira spent by the various governments, not much impact has been felt by the consumers.

No severance pay for TCN workers – Nnaji[color=#990000][/color]
Oscarline Onwuemenyi
& Kunle Kalejaye
24 July 2012, Sweetcrude, ABUJA -MINISTER of Power, Prof. Bart Nnaji, says workers of the Transmission Company, TCN, should not expect severance pay because the transmission network is not being privatised.
He was reacting to protests by the workers who barricaded the Power Holding Company of Nigeria, PHCN, corporate headquarters in Abuja, and also blocked a major highway ostensibly to prevent the new managers of TCN from assuming duties. The workers were said to have threatened to continue the action until their severance and other PHCN-negotiated benefits have been paid.
But Nnaji explained that the government was still negotiating with representatives of the labour unions only in respect of severance and other benefits for staff of 17 unbundled PHCN generation and distribution companies that are being privatised, which does not include the TCN.
“I cannot understand why the workers embarked on protests when TCN remains a government holding company which has never been put up and shall not be put up for privatisation,” the minister said.
He added that rather than privatise TCN, which would require sorting out labour issues, government has approved the employment of an additional 1,000 engineers and technicians to plug the shortfall in manpower needed to run the power transmission backbone.
Management control
The Federal Government, Monday, officially handed over management control of the TCN to Canadian firm, Manitoba Hydro International. The TCN manages the nation’s key power transmission backbone, otherwise called the National Grid.
Manitoba is coming with about eight expatriates to run the Transmission Company for a period of three (3) years in the first instance.
According to the Bureau of Public Entreprises, BPE, which recently concluded the takeover process, the current managers of TCN will understudy the expatriate managers, acting as their shadows.
Nnaji had earlier stated that government would not allow the electricity workers’ unions to box it into a corner in its bid to enthrone and ensure best practice in the management of Nigeria’s transmission network.
According to him, “It is very important to understand that the Federal Government is doing reforms in the power sector and the President is absolutely focused to ensure that its reform is successful. Reform by its very nature is positive but if anybody is against it, then the person has to stand aside; government really shouldn’t be running power facilities but setting policies, doing research that will ensure system growth.
“Everybody will tell you that if you have enough generation and cannot wheel out power, that is failure and that’s where we have technical and commercial losses, so we want a stable transmission network and that’s why we are bringing experts. We are not here to replace all the workers of TCN and its only eight officials of Manitoba Hydro that will be here; we need Nigerians to man the business, and in due time we would like to have TCN international so that we can go to other countries and sell the business.”
The minister further explained: “It is unpatriotic for anybody to say that they do not want to learn how the system will work better because this has nothing to do with privatisation and we will not have it.
We’ve had private management of the core jobs of PHCN in the past and it had worked so we will not allow people to prevent us from moving forward in our desire to put best practices.”
Last Friday, in a seeming show of desperation, the unionists who had prevented smooth flow of vehicular traffic on the Aguiyi Ironsi Way with their staff buses that were used to cordon off a lane of the road resorted to physical assault of the media crew of Nigerian Television Authority, NTA.
A good number of the unionist had descended heavily on the NTA cameraman who was busy filming their activities on the excuse that NTA is a partial government media outfit. The assault was however prevented from escalating further by the Area Commander, Metro Abuja of the Nigeria Police Force, NPF, Mr. Odukoya Sunday.

Minister of Power, Bart Nnaji, opens up on the state of Nigeria's energy sector and the
Electric Power Reform programme in an interview

The nation has been bedevilled more with mega-excuses rather than the promised megawatts; Why?
Thank you for this opportunity to talk about what we are doing. I did not realise that we have been offering so many excuses. I thought
We were telling you what the situation is. I have been minister for ten months. Prior to that I was adviser to the president on power and when we came, what we saw was an absolute mess of the power sector. We met 2,800MW of power delivered to the grid; a lot of the power plants were never really in order and got epileptic maintenance that naturally produced epileptic power supply. Ideally, a power plant should be maintained on schedule and if you don’t do that, you run the risk of running down the plant. So we had a lot of power plants that did not produce up to 50 per cent of their installed capacities; that is the sort of thing we met.

The national grid was also weak, which means if something happened on the grid, you ran the risk of cutting off a whole region. In addition, there was no plan for gas supply to the thermal power stations, so we had plants that were being built without gas availability or a proper plan; the distribution plan was also in disarray, such that we could have a power plant without actually getting the electricity to where it could be used. Unfortunately, those in the sector know that power production and delivery are not like building roads and some other facilities. If you are building a road, you can build 50 per cent of it and put it to use, but for power, 99.9 per cent will not be sufficient; you have to have 100 per cent completion to fire it to work. Secondly, it takes time to build a power plant, no matter what anybody tells you, you do not buy power turbines off the shelf. If we had started when we came in here to build any power plant, we would not have completed it by now, no matter the miracle.

So that is the situation we met but we found that Obasanjo’s regime had covered a very positive and important mileage in the power sector, that is the establishment of the Electricity Power Sector Reform Act of 2005. That Act was essentially aimed at reforming the sector with the realisation that NEPA as an authority that prevented anybody else from generating electricity or distributing electricity was not in a position to solve Nigeria’s power problem, and that the population was growing at a tremendous rate. We needed an economy that would compete with others in the world, and prior, we had not invested in power for a period of 15 years so there was no real investment in power production, and there was no way we were going to catch up with the rest of the world with NEPA as the driver of the power sector. So on realisation of this, the natural thing was to reform the sector.

It therefore paved the way for private companies to generate and distribute electricity, that’s what informed the 2005 Electric Power
Reform Act. But an act of parliament could not just be on the shelf with no accompanying action. We thought that a way to start would be to have a roadmap based on that Act and that roadmap which the president launched in August 2010 provided for step-by-step implementation of the Act, as well as the assurance that with that implementation we would reach the point of absolute reliable and sustainable electricity in Nigeria. So a lot of work had been going on behind the scenes, not something that could give you electricity today but something which if we implement as we are implementing would absolutely ensure that we have electricity in the medium to long term.

With respect to implementation, we are getting to the point of completing implementation of the key pillars of the reform programme.
When we started to implement the roadmap, we took a two-prong approach as the president announced in his speech. First, we said let us do as much as possible to recover capacity at the power plants that are installed but not working, let us fix them. Based on that, we would have been able to recover more than 1,000MW within the short period. We also said let’s aggressively pursue fixing the transmission network, so that as we continue to improve power we would be able to take the electricity to the needed destinations, which would translate to an investment on improved distribution network in the short term. The next step was to create the institutional framework that will ensure reliability and sustainability and those institutions would be there to ensure that we are able to purchase power and provide guarantees that would pave the way to transition from public management to private sector management – the privatisation programme is part of that, with transparency in view. Therefore it is not something that you could go and do in the backroom and come out and finish instantly. It was a step-by-step process that required carrying the public and the international community along in the completion process.

Don’t you think the priority would have been to maintain the existing level of power supply by fixing the old plants, the fragile infrastructure of the existing plants under your rehabilitation exercise, and then proceed to the bigger project that takes us to increased output and privatisation?
That’s actually what I said. We are taking a two-pronged approach – the first is involves quick recovery of installed capacities, but we should not forget what actually it takes to undertake recovery. It means the fresh installation of 1MW of power, which costs $1 million.
That means that if you are going to build a brand new 1,000MW station, it will cost you $1 billion. However, we don’t have such resources now. I will give you a simple example: the recovery of one unit of Afam provides 138MW, at a whopping costs N6.9 billion but that is just 138MW. You will find some others that cost more, so the money isn’t just there floating for us to do the massive recovery that is needed to turn the sector around. That is why the privatisation of the sector is essential. As such, the first thing that made sense was to a do a quick fix and right now this approach has yielded 1,000MW extra, with an additional 1000MW expected this year which should bring total available capacity to 5,400MW. If we had been consistent with this type of aggressive approach, we won’t be having the problem we are having now. Then again, Nigeria is a country of 167 million people so even when we recover 2,000MW that will be insignificant. So for this year, we are going to rely on the quick recovery approach and the coming on stream of the National Integrated Power Projects (NIPPs) that was started sometime ago and stopped in 2007 for almost two-and-half years and then restarted by this administration with a fast-track philosophy. We are aggressively pursuing the completion of these plants and we will be able to get a number of them on stream this year.

So what are the main challenges you anticipate in wheeling out the extra capacity expected to come on stream?

Actually, our problem is going to be the scarcity of gas. We have a problem there. If you give me gas today, I will give you an additional 1,500MW because we have the stations ready to take the fuel but we don’t have the gas. Just two days ago, Utorogu Gas Plant was shut down for repairs, and what we have lost because of that is over 390MW. So the problem of power supply in the recent past has been lack of coordination; we have not coordinated in such a way that we have enough gas for electricity production. There is also the problem of transmission infrastructure, but we are handling the transmission part. However, gas is going to continue to be a major challenge unless something is done, the same thing that we have done in power needs to be done in gas for us to have adequacy.

What is the problem with having gas, it is not that it is not available, so what is the problem?
We are a country very rich in gas, we have not just planned to produce gas for commercial consumption and the problem of insufficient power is here. By next year, we will have available capacity of close to 9,000MW from the NIPPs coming on stream. If we are able to generate the expected quantity of gas for power, we shall be able to witness a drastic improvement in power supply by the end of this year. Based on what is currently on the ground, starting from next month, you will begin to see an improvement similar to the December/January (last year) scenario when the improvement was felt by all. This will be repeated more prominently, we will exceed that quotient this year and we will stay like that on an incremental basis. But realistically, Nigeria should be leapfrogging, as I don’t want to be talking about 3,000-4,000MW. I want us to think about leapfrogging so that we can catch up with other emerging or developing nations, that is where I am heading for.

Don’t you think the situation in the power sector calls for something more than the emergency declared in the power sector?
There is no need for emergency in power really because we have tackled the main problem that will deliver power, I can tell you that.
(Cuts in…) But we are living in an emergency already, and the problem Dr. Eddie Iroh described captures it all. I think you can have an interface with Servicom so that the communication between consumers and service providers flows on a steady basis; it doesn’t have to get to the minister, but to somebody near his table and it comes under one page.

What we have done ourselves is to set up consumer consultative forums, which were launched last month, but of course we have to promote them, so that people should know they are available. With the forums in place, if we have any issue, we should just call or send an email and someone will respond within a certain period of time, because we have these problems ahead of these complaints – it could be a transformer fault or something else. Somebody was saying they were made to buy a transformer for their neighborhood, but it is not something that should be happening because transformers are provided by the power authority and are free. However, I must admit that we are dealing with one of the most corrupt, if not the most corrupt sector of the economy, that is where we have found ourselves, and what we are doing is to cut off the head of the snake through privatisation – transfer the distribution companies to the private sector, so this way, the owners will now be chasing after you instead of you chasing after them.

In this respect, what has happened in the telecoms industry will surely happen in the power sector – the bidding process will be completed in July next month and bidders will submit their bids by October, so we expect that we should announce winners soon after. Under the current dispensation, those who call themselves distribution companies that interact with the consumers are marketers who work for themselves; they are out there, their small networks or companies, exploiting consumers and we have heard about them. But we have to stop this whole thing because the key to having investors agree to build a power plant is that they must sell to credible buyers. What we are doing to contain this fraud is to use the bulk trader to buy power and provide guarantees. But really, the ideal situation is to have a bilateral agreement. You don’t need to have a middle man in the business, but to have that, you need to have a credit worthy off-taker, and a credit worthy off-taker means the distribution company network should be robust, that the distribution company mode of collection must be efficient, that you must have a really efficient and honest system that can only come through the privatisation process.

What this translates to is that if your transformer breaks down, the distribution company must come to repair it because it will be losing business if it does not fix it. You will be provided with a prepaid meter, because that establishes a transparent transaction between you and the provider, which would rather be efficient than argue with you. The provider would want your business. This is the market structure we are headed towards and we are almost there. But many want to remain under the old order where the distribution companies preferred the corrupt billing system rather than the pre-paid metering system.

On this issue of distribution and increased tariffs, what have you done about the emergence of a private sector monopoly in the absence of an energy trust law?
It is not increase in tariff, it is tariff adjustment.

Up or down?
Down for the rural dwellers and the urban poor, from N7.00 per kilowatt hour to N4.00 per kilowatt hour. Then other category of consumers will pay more but it will be graduated.

But how can you increase the electricity tariff for other consumers that they are not getting?
Nobody is asking you to pay for what you don’t consume. Who is going to charge you for what you have not consumed

But not with the way PHCN goes about doing their estimates?
No, they will not. In any case, this will end with the introduction of prepaid metres, so you will only pay for what you consume. Like I said, we have endured this problem for so long, and we are almost at the point where we will say good bye to all that. But let me come to the issue of trust and monopoly raised by Mrs. Uwais. The goal is to privatise the distribution companies, as we have 11 distribution companies covering the entire nation. Some of the distribution companies have five states, some have four states, and only Lagos has by itself two distribution companies – Ikeja and Eko. A distribution company will cover a territory because electricity is necessarily territorial in nature. However, at the time we reach the point of wiling buyer and willing seller, stability will emerge, and it becomes possible for electricity to be sold as a commodity. You can buy from some other company that is putting power in the grid and selling to you while your neighbor can buy power from another company. So that time is coming, but for now, we have the territories, just 11 of them in the country and they are being privatised. When this happens, it is also possible that each company can decide to break up and have more companies; that can happen. Ibadan, for example, is a huge distribution company and could decide to just break up, which can further expand to more companies by choice. But for now, there are 11 distribution companies covering the entire nation. So the issue of monopoly does not arise. That was the essence of the Electric Power Reform Act to break up the old NEPA into competing units.

What are your biggest obstacles to the reform measures, corruption or the generator companies?
What have you done to resolve this problem?
I have too many, I can give you some comprising internal and external challenges. For example, people who are benefiting from contracts within the system are obstacles and they would rather we don’t privatise anything; they would rather not reform anything.
They are happy with the way things are. Those people exist, there are people outside or semi-outside who are the contractors and they will prefer to enter into contracts with government than the private sector for obvious reasons, and this is before you come to generator suppliers, diesel suppliers, and workers who are in business for themselves selling electricity and enriching themselves in the process. The good thing though is that the electricity unions have come to an understanding that Nigeria must move forward, so we are getting closer to an understanding. Before, they were used to conducting prayers against Bart Nnaji, because they didn’t want me to survive, they wanted me to die. Those people are there, but the expectation is that we would come to the point where everybody will see that this is really good for them. It must be acknowledged, nonetheless, that reforms are like this, maybe even harder in Nigeria, because they are normally resisted. I am sorry to say this but Greece is where it is because people refused to take proper economic steps and that is why they are where they are today.

Of all the challenges you listed, availability of gas for the power plants remains central to the privatisation process and increased output, others are minor and can be resolved with privatisation. Also, we have been making this mistake of comparing the telecoms sector with electricity. One thing we forget is that reforms in telecoms were not hinged on the availability of gas. Meanwhile, up to 70 per cent of our electricity comes from thermal power stations, not hydro or coal, and is hinged on the availability of gas. So even if we privatise in three months, without gas, the problem will not be solved, yet gas is under another ministry.

Why are you not emphasising this; is there an interface between your ministry and the Ministry of
Petroleum Resources to resolve this thing once and for all?

What I would say is that unfortunately the investment process for the gas sector is perhaps even worse than the process of investment for the power sector. At this juncture, let me state that the IOCs (international oil companies) have no choice but to come to terms with the current arrangement. Right now, we have an inter-ministerial committee that is supposed to work on the emergency provision of gas for power; there is a quantum identified where we can quickly get gas for the next 12 months. The maximum that we can get out of that I believe is about 500-700 million standard cubic feet of gas, and that means we will have less than an additional
2,000MW that we can transmit, with that extra gas. So yes, if we are not able to solve the problem of gas, we will not be able to get to where we desire, which is 48,000MW and beyond. Something very transformational must happen in the gas sector that will change the direction, so that is a critical issue. But we believe that gas producers will be encouraged to begin to invest in gas production and transport to the power companies with the cost reflective tariff put in place.

Those of us on the power side have made every commitment that we’ve been asked to make. We have increased the tariff for gas from 10 cents that NEPA used to pay to $1 and next year it will be $1.50, then it will reach $2 the year after. We have also agreed that if the infrastructure for the transport of gas is built, that we are prepared to increase the tariff for gas transport to 80 cents, so we have made every commitment on the power side. It is now left for the gas producers to do what is expected of them, as we have followed through by putting in place cost reflective tariffs on the power side. This way, gas producers can be paid today for gas and instances of debt will no longer be a problem. This is because the PHCN owes the gas producers; we were only able to pay 50 per cent for the gas supplied to us. However, since we have the private companies, all these oil blocks in non-associated gas production should be opened up for production; non-associated gas production must come into play here.

Nonetheless, we should not be talking only of the associated gas, rather, gas flare-outs should also be exploited; we cannot be flaring gas in the country. That means serious efforts must be made to change the direction in gas exploitation if we must move forward, as we are going to rely more and more on gas. In fact, the plan I have is that by 2020, when we are talking about available capacity of more than 40,000MW, of that, 25,000MW will come from gas fired plants. But a review shows we are very far away from attaining that in terms of gas production to be able to attain this benchmark. Even the agreement that we have entered into with
General Electric (GE) and Siemens, is anchored on gas plants with 20,000MW as the goal, 10,000MW from General Electric and 10,000MW with Siemens. This is the first real serious commitment by major investors to join us in our mission to transform Nigeria’s power sector. When General Electric agrees to put down its money, it is good news because we have so many turbines made by GE in Nigeria. But of all these, GE has hardly invested a penny in Nigeria or even in sub-Saharan Africa, so this is the first time they are actually investing equity in Nigeria and Siemens has followed through. As such, it is tremendous, but gas must be there to support this partnership. I can even tell you that we would begin to see results from the agreement immediately because GE has mobilised its team for work.

It is a little bit uncertain when as a minister you are telling us that there is problem with gas. Is it not the same government that is pursuing the electricity road map that draws up a policy on gas?
Why is it that there is no coherence in government? It is not like we are talking of gas controlled by
Niger Republic or Republic of Benin?
We find this very strange
We have to take the PIB very seriously, we need to do that. We need to have a bill that makes it possible for private companies to invest and be able to recover their investment in Nigeria’s gas industry. Right now, it is not quite like that. We all know that Nigeria is more of a gas country than an oil country – 187 trillion cubic feet of gas is available in Nigeria. This means that we can be awash with gas for domestic consumption, so we have to take the issue of gas seriously.
You were one of the first individuals to setup a private power outfit – Geometric
– What were the challenges you had and how would you compare them to what you are facing now?
Besides, don’t you see your role now as minister and an operator in the sector as a conflict of interest?
I am not currently an operator in the sector, but I found a company that is in business, and that company Geometric Power took a risk to work with our people to improve the power sector. That is not a crime, but I think people try to make it seem as if there is something wrong there. However, I can tell you that the experience I got from that project is what is helping me to solve the problems I am facing now, because I faced tremendous challenges. And talking of challenges, I know where the dead bodies are buried and so because of that I can solve the power problems much better and we have gone very far in resolving those problems. So I don’t see any conflict between Geometric and my present assignment. Moreover, it is a corporation, it has a board and it has people there. So when I was appointed, I resigned and put my shares in a blind trust because that is how it is done anywhere in the world. As such, I don’t think people should make it a big deal that I formed a company or became the first indigenous power company in this country that invested hundreds of millions of dollars to build a power plant, because other people also came and invested in it. In my estimation, I think you people should be praising the effort that we made and that we didn’t do it from a corrupt background, that this was legit, built and financed in the normal way that it is done anywhere in the world. I think that is important.

Irrespective, I faced a lot of challenges; the first was it had never been done. In fact, the first private power company was NESCO, a tiny little hydro plant built in the 1920s in Jos and of course you know the effect of that, because with NESCO, that part of Jos got reliable electricity. So what we set out to do in Aba was to set that city on absolute reliable electricity with a power plant. That is the only way you could assure that. These are the things we are talking about, bringing distribution companies to distribute power that is what we also set out to do in Aba – we had to invest in building and rebuilding the distribution network. For example, when we came into Aba, Aba had only three substations 2/15 MVAs, so even if you have all the power to give to Aba, it will not get to its citizens and that is the same thing in most parts of this country. That meant we had to build four brand new sub-stations plus the power station.
The investment just in distribution alone was about $50 million; the whole investment to make Aba electricity reliable is about N70
Billion.

But as we were getting started and found that the Electricity Act that was put in place had been suspended, the implementation of the project also got suspended, so investors froze; the regulator that was put in place also got sacked. And all these sent the wrong signals to investors, who felt understandably that this country could not do transparent business because the regulator who should be responsible for transparency was not in place. The spill over after the re-activation of the Act was that the unions refused to cooperate. Also, the banks which had never engaged in the business of power balked, because we are not talking about pennies here, we are talking about serious money, so the banks were afraid that if they went ahead without some international investors that they might lose money. That was another level of challenge that we encountered. But they were so many others. It also took us two years to negotiate a gas supply agreement. The very first commercial gas supply agreement in Nigeria took us two years on both sides to come to terms, and we had to chase the people all over the place who would sign the agreement

The previous government suspended the implementation of the NIPP for two-and-half years, how would you rationalise that?
I can’t.

It borders on criminality if you cannot rationalise it, because for a country that is in need of power and its own government stops what would have helped to advance the power sector for two and half years, so questions should be asked about that. You and the Jonathan administration owe the country an explanation.
Also the governor of Rivers State said recently that his state is capable of distributing power to
Port Harcourt and that Rivers State is ready, but the government says it must be transmitted through the national grid. I think one of the problems is this centralisation of the power sector. I would have thought the Rivers model should be encouraged, because the impression being given now is that states are stranded in this matter; there are some governors who also want to build power projects but they refuse to because they don’t want to take it to the national grid.
What’s your take on this?
On the first point, regarding the suspension of the NIPP, what I know is that I cannot rationalise it. And fast tracking the implementation of it now should be indicative that we were not in support of stopping the NIPP projects, as you can see, work is ongoing as the completion process comes closer. We have over 4,000 kilometres of high tension transmission lines as part of the
NIPP project; we have 10 power plants to deliver as part of the NIPP package; and over 4,575MW to be added to the grid from that arrangement. We have some distribution projects, so it is massive work that needs to be really completed. We believe that these projects should be finished and we are doing that with the speed it deserves.

As for state governments investing in the power sector, they can also invest in the distribution side. Each state that wants to distribute electricity should be allowed to do so. However, privatisation actually is aimed at achieving that in a coherent manner, by having 11 distribution companies. For instance, Rivers State is part of four states – Rivers, Bayelsa, Cross-River and Akwa-Ibom States – that are covered by what is called the Port Harcourt Distribution Company, which will be privatised upon completion of the privatisation programme in October. That group, however, can decide to get a divorce in their marriage if they don’t want to be under one Distribution Company. So Rivers State can now decide to break off and establish a distribution company there servicing it; but realistically, it takes some time to untangle certain things like the electricity network.

Accordingly, we believe that the states should be accommodated as part of the whole reform programme. As such, Rivers, Akwa Ibom, Cross River and Bayelsa will become part owners automatically of the Port Harcourt Distribution Company that covers them. In addition, we have given the states opportunities to be part of the bid process, so they can choose a company/consortium that has already been approved by BPE today as a bidder and bid alongside it. Of course, these four states actually have a company that they are backing. However, all they are really asking for is that we should hand over the distribution companies to them today. But why should we do that? In doing so, we will be telling the whole world that we are now stopping privatisation and just going to hand over the distribution companies, and that the transparent process that we started is no longer going to be possible. However, a power plant is different from a distribution company because anybody can build power and sell.

But are the states interested in producing power for business or for their people?
That’s what we should ask because if a state builds a power plant, it can request that the power be domiciled locally and nobody is saying no to that.

What is stopping you from dismantling your legislation and allowing states or whoever to generate and distribute power with absolute control?
Technically nothing; people can come to it if that is what they choose but there is nothing that suggests that the states can be better managers of electricity than the federal government, and if you want to solve the problem, it is not by trial and error. You have to do something that you will be sure would work.

Why don’t you just open up the sector and relieve yourself of political pressure?
That is what we are doing. We said that by October of this year, privatisation will be concluded and it is a certainty. Upon completion of the privatisation of, say, the Port Harcourt Distribution Company, the federal government will have at best, less than 25 per cent of equity ownership there. So combined, the federal government, states and workers will have about 49 per cent, while 51 per cent goes to the private sector investors.

But the percentage holding will appear to still mean certain political interference; what is the purpose of the percentage holding?
By October, you will no longer hear me talk about distribution because it would have gone private, but if you are saying the federal government should sell 100 per cent, so be it but the way it is structured is that private entities should take 60 per cent because the valuation in advance of the states' contributions has not been done yet. So it is important to say the private companies should take 60 per cent ownership and reduce the federal government’s ownership to 40 per cent to start with. Then, the federal government should give up a portion of the 40 per cent to the states as part of the automatic acquisition of shares because of the valuation of their contributions. We don’t know what that is, but if it is that the state government invested 100 per cent in the distribution company, then the federal government would have nothing which means that the state would have 40 per cent. But if the state invested 30 per cent, the federal government will have 10 per cent and workers that would now come in, should be entitled to take up to 10 per cent of whatever the federal government is holding. That is the law.

It means that with the federal government still retaining shares, and then the regulator is an investor?
No, the regulator is a regulator and always an independent entity.
What is the installed capacity of private generators in Nigeria because it is believed that we are privately generating about 100,000MW and Nigeria plans to increase power to 15,000MW in the next three years. Given our population growth, meaning that it will make no difference?
No, you just made up figures from the top of your head and last January when we hit about 4,000MW, it was felt by people.

What is your projection by 2015?
The projection for 2015 is that by its end, we would have installed capacity of 18,000MW. There are actually three categories of output—installed capacity, available capacity and then on grid capacity. You can have installed capacity and not all the units will be functional. Available is that the unit is ready to generate power if you give it fuel and that is where we will like to be for all the power stations. But on grid capacity refers to when we have the fuel to generate and we actually do so; that is where we are.

[b]Power Progresses Steadily Amid Gas, Labour Challenges
Minister of Power, Prof. Barth Nnaji

With unprecedented investor confidence, buoyed by transparent reform process, Ejiofor Alike writes that the power sector progressed steadily in the first half of this year, amid challenges

Nigeria’s power sector has no doubt, progressed steadily since August 26, 2010, when President Goodluck Jonathan launched a roadmap for the sector and also resuscitated its reform, in line with the Electric Power Sector Reform Act of 2005.

During the first half of 2012, under review, there was a leap in the quantum of completed projects, as well as unprecedented show of confidence by local and foreign investors, jostling to buy the power assets slated for privatisation.

A transparent reform process packaged by the Bureau of Public Enterprises (BPE) and the huge potentials of Nigeria’s power sector accounted for the increasing appetite of the local and foreign investors for the assets, with over 330 reputable entities jostling for the assets.

Under the power roadmap, the complete winding up of PHCN was slated for December 2010, while the handover of the six generation companies of PHCN to the preferred bidders was scheduled for April 2011.

Successful investors also ought to have taken over the 11 distribution companies by June 2011, while April 2011 was the deadline for the handover of the Transmission Company of Nigeria (TCN) to a management contractor.

Though the 18 companies were successfully unbundled, the BPE had to reschedule the sale of the 17 successor companies from March 2012 to October 2012, being the third time the sale would be postponed.

The half year under review also witnessed the completion of some of the 10 power stations, under the National Integrated Power Project (NIPP).

Managing Director of Niger Delta Power Holding Company, operators of the NIPP, Mr. James Olotu told THISDAY that NIPP started in 2004 as a special intervention of the three tiers of government to tackle the power deficit “having realised that without power, there will be no potentials to be unleashed for the people of Nigeria to go out to develop.”

“Today, through that effort we have 10 medium-sized power plants at various stages of completion. We also have over 8,000 kilometres of transmission lines- 330/132kv and various substations to boost power supply.

“We have about 295 distribution sub-stations, with again, up to about 5,000kilometres of distribution lines to boost the power infrastructure of Nigeria and create enabling environment for business and social welfare of the people, so that very soon, Nigeria will take its rightful position in the comity of nations” he said.

Review of Tariff
A major development in the country’s electricity industry in the first half of 2012 was the review of tariff, which took effect from June 1.

Under the new tariff, lower categories of consumers are now paying between N4 and N22 per kilowatt hour, depending on the class, pending the introduction of cost-reflective tariff. (TO BOX AND SHADE).

The Nigerian Electricity Regulatory Commission (NERC) said the average cost of energy is N24 per kilowatt hour.
The new tariff was calculated based on the cost of maintenance of meters, replacement of transformers, expansion of facilities and the average cost of the total quantity of electricity to be consumed yearly for the next five years.

However, N50 billion subsidy will be provided yearly for the lowest-paying customers –Residential (R1); R2 and Commercial (C1) customers in 2012 and 2013.

The new tariff provides that R1 customers will be paying N4 per kilowatt, as against N7 and N10, while the R2 customers, which constitute about 80 per cent of the consumers, pay between N11.50 and N12.30, depending on their location.

Commercial 1 (C1) customers, who are artisans and small and medium scale entrepreneurs, are also enjoying subsidy and paying between N15.64 and N17 per kilowatt hour. It is believed that this group contributes most of the household income and a huge energy bill will be a major challenge to them.

However, R3 and R4 customers, who have maximum demand meter and also take electricity supply direct from transformers pay slightly above the average cost of energy to further subsidise the R1, R2 and C1 customers.

Electricity Supply
Electricity supply improved considerably at the beginning of the year before it nose-dived due to low water level at the hydro-power stations and inadequate gas supply to fire the power plants.

Minister of Power, Prof. Bart Nnaji told THISDAY that the maximum power delivered to the national grid during the period under review was 4,400megwatts.

“The maximum of delivered capacity is about 4, 400 megawatts, which we attained in January. That is a record, all time. Unfortunately, we went down because of water and gas. Transmission network has been expanded significantly over this period. Privatisation process is scheduled and will complete this October. The bids will come this July, and Mr. President has given instruction that there should be no shaking in terms of the timeline. It must complete,” he said.

Chairman of NERC, Dr. Sam Amadi, told THISDAY that the worst time for a minister of power or a regulator of the power sector in Nigeria is the period around April and May when there is usually low water level at the hydro-stations, coupled with inadequate gas supply to run the gas-fired plants.

He said these twin challenges would make it difficult for a minister or a regulator to explain and defend the epileptic power situation during this period.

Nnaji also described the water level during this period as a cycle and natural phenomenon. “Every year; by March and April and part of May, you have low deep. Unfortunately for us this year, in ten years we have the lowest water level because of drought, especially since we have not been able yet to produce gas to support the thermal power plants so that we will be able to take up that slack when power goes down because of hydro.

“One thing I can promise you: next year you will never see this. We are making sure that by next year; you have enough gas to support additional capacity at the plants so that we have what we call spinning reserve, or reserve, so that they will be able to take over when the water level drops. So this is in the plan. So, Mr. President’s objectives are very clear in this,” he said.

Challenges
Apart from the problem of low water level and inadequate gas supply, the power sector also faced the challenges arising from the resistance of the labour unions to the reform.

An energy and investment adviser to some of the core investors, as well as Lagos-based lawyer, Mr. Iseoluwa Abiodun-Johnson, told THISDAY that conducting due diligence was a tough exercise for the core investors because of the hostility of the workers.

He noted that the BPE tried its best to make relevant documents available to the core investors but that the workers made it difficult for investors to gain access to PHCN facilities, adding that even the Federal Government’s due diligence advisers faced similar challenges.

“Going on site visit, the BPE had to take armed security agents. That hostility on the side of the workers, to me, is ill-advised because the workers are going to be the greatest beneficiaries of the reform. The core investors will pump in money; pay huge salaries and improve the ways of doing business because they want results,” he said.

There is also the issue of PHCN’s heavy indebtedness, as its failure to settle its N88.7 billion debts to gas and power suppliers apparently derailed the process.

However, electricity consumers across the country are also indebted to PHCN to the tune of N110billion, with government agencies accounting for substantial chunk of this debt.

There is also concern that the successor companies are not being run as separate entities, contrary to the provisions of the Electric Power Sector Reform Act.

“Even though the 18 companies have been unbundled from PHCN, they are still being operated as units of PHCN and not as independent companies as EPSR Act 2005 stipulated. In the course of conducting due diligence, many of the documents required by the investors were obtained at the head office, instead of at the individual companies,” said one of the prospective investors.

Nnaji, however, said the government was moving very well with the labour unions, adding that the milestones would all be met.

“Agencies are fully operational and funded. There is total value alignment as I have talked about. Power now is moving towards willing buyer willing seller, a business, rather than just a pure social service, which cannot deliver power to everybody. The target of ownership structure is very well defined, and we are moving very well with the labour unions,” he said.

To address the labour issues, which is one of the requirements of the EPSR Act of 2005, President Jonathan’s administration paid electricity workers all arrears of monetisation, which was denied them for seven years, even after their counterparts in the civil service were paid.

Government had earlier appointed a Chief Negotiator in the person of former President of the Nigeria Labour Congress (NLC), Alhaji Hassan Sunmonu, to dialogue with the workers.

The workers also enjoyed 50 per cent increase in their salary with effect from June 2011, while the process of regularisation of the appointment of nearly 10,000 casual workers had commenced.

The National Power Training Institute of Nigeria (NAPTIN) in Abuja was also resuscitated, with the ministry of power seeking N4billion from the 2012 budget to be injected into the institution for training manpower for the industry.

But despite repeated assurances by the government that the reform would open enormous employment and business opportunities like in telecommunications following its liberalisation, trade unionists in the sector have insisted that it would lead to job losses.

POWER REFORM HITS MILESTONE AS MANITOBA TAKES OVER TCN

The Federal Government on Monday in Abuja signed a three-year contract with Manitoba Hydro International (MHI) of Canada for the management of the Transmission Company of Nigeria (TCN), a significant stepping stone and transition for the power sector reform.
Bola Onagoruwa, BPE director general, who signed the contract on behalf of the Federal Government, said the Canadian firm would resume work on Monday, July 30, at the PHCN headquarters in Maitama, Abuja.
Onagoruwa listed stabilisation and security of the grid, reduction of electricity losses during transmission and staff reorientation as some of the key objectives of the contract.
“The management contract would also provide efficient management of government investments and ensure adequate and equitable generation dispatch, according to fair merit order and sound regulatory principles.
It will also ensure fair market settlements between electricity traders and provide for skills and expertise transfer to the Nigerian counterparts who will serve as deputy and in other positions to the management staff of the management contractor,” she said.
Onagoruwa added that to ensure a seamless transition, a workshop and briefing session between the new managers and the staff would hold on Thursday, July 26.
“The target of the workshop is to sensitise members of staff of TCN, allay their fears and secure their commitment,” she explained.
The director-general’s assurance came on the heels of protests by labour unions against the takeover of the TCN by new managers under the Federal Government privatisation policy.
The workers insisted that government must resolve all outstanding labour issues before the final sale of PHCN to private investors.
The company’s managing director, Lonrne Halpenny, who commended the Federal Government for a “successful and transparent transaction,” signed on behalf of his organisation.
“MHI is aware of the importance of this contract with respect to the privatisation and other initiatives going on in generation, transmission and distribution,” Halpenny said shortly after the historic signing.
“We understand that transmission is a very important aspect and we are aware of the challenge; it is a big challenge and we want to assure everybody that we accept the challenge,” he said. Atedo Peterside, chairman, Technical Committee of the National Council on Privatisation (NCP), said at the event that bringing a world class operator like Manitoba Hydro into TCN was significant for the sector.
“Today’s signing ceremony is significant in two important respects: First, it confirms a change in policy direction by introducing outside expertise into the transmission segment of the industry and second, it confirms that a fourth pillar of the Road Map for Power Sector Reform is now in place,” he said.
The first three pillars already in place as envisaged by the power reform roadmap are the establishment of an independent regulator for the sector; the Nigerian Electricity Regulatory Commission (N.E.R.C), setting up of the commercial framework for the sector (via cost reflective electricity tariffs) and the bulk trader.
This was one of the milestones expected to be in place before private sector investment activity in the power sector materialises and signals the official entry of MHI into Nigeria as the company responsible for taking over the day-to-day management of TCN.
The TCN is the Federal Government Company which owns Nigeria’s electricity transmission network.
A successful execution of the remaining pillars will liberate Nigeria’s power sector, helping to unleash long term private sector investment activity into the sector akin to what happened in the telecommunications sector.
Nigeria with a population of 160 million people is estimated to need about 40,000 Mega Watts (MW) of electricity over the next decade, but currently has less than 6000 mega watts (MW) of available capacity, leading to costly blackouts that have kept the Nigerian economy from growing at its full potential for decades.
Nigeria needs $10 billion a year, or up to $100 billion of new capital investments over the next 10 years to meet its power sector needs; and it is hoped that privatisation will greatly improve service and output.

ELECTRIC POWER IN NIGERIA: THE SUN ON THIS RUBBLE
Lecture by Professor Bart Nnaji, CON,NNOM,FAS,[/b]
Honourable Minister of Power, to Participants In Executive Intelligence Management Course 5 at The Institute for Security Studies, Abuja, on Monday, June 11, 2012.
It is my pleasure to be in the midst of the top echelon of the nation’s intelligence and security community to discuss with you the state of Nigeria’s electric power sector, especially the new direction in which it is headed under the President Goodluck Jonathan Administration. An efficient power sector is central to national security, national survival and national prosperity, just as an efficient intelligence and security system is a desideratum. Modern society runs on electricity, and electricity development itself cannot take place in an environment which is not safe and secure. Yet, both the power sector and the security environment in Nigeria are going through challenging times.

I would like, at this juncture, to publicly commend the intelligence and security community in Nigeria for its heroic service to the nation. The men and women in various intelligence and security apparati stand in harm’s way every minute of the day so as to provide a conducive environment for 167 million Nigerians to live and work in peace and harmony. Theirs is the ultimate national sacrifice. As has been observed over the ages, there is no love greater than the fact that a man should lay down his life for the benefit of his people. Still, the immensely sacrificial role of our security men and women is scarcely recognized by the larger society. The few lapses in their performance of duties are those which daily catch media headlines, with the impression sometimes created that they are not quite competent. Yet, when junior officers in the Nigeria Police Force went on a strike in the early 2000s, the first and only time in our national history, no bank in Nigeria opened for business for even a second! Not even banks in rural communities where the crime rate is very low opened for a moment.

The Federal Ministry of Power appreciates the effectiveness and efficiency of the men and women who, every second of the day, protect our lives and our assets and ensure there is peace and order in society. Towards the end of 2010, the President and Commander-in- Chief of the Armed Forces of the Federal Republic of Nigeria, Dr Goodluck Jonathan, GCFR, directed soldiers to join the police to guard all electricity installations across our vast country. Some citizens who did not appreciate the wisdom and foresight in the President’s directive took exception to it. But today the whole world knows who was right and who was wrong. Suffice it to say that to this day all power facilities in the country have bravely been protected by our intelligence and security agents, despite the considerable security challenges in the nation. Theses gallant officers rose to the occasion when some dare-devil elements tried some months ago in Yobe State to attack our power facilities. And when the undesirable elements pursued the soldiers to a hospital where they were receiving medical treatment, the soldiers once again gave a good account of themselves.

Nigerian intelligence and security operatives will be among the most efficient in the world if provided with the necessary facilities. Nigerian military officers are always in high demand for peacekeeping operations, having excelled in such places as the Congo in the 1960s, in Lebanon in the early 1980s, in Liberia in the 1990s, in Sierra Leone in the 1990s, etc. The Nigerian police have also excelled in international operations right from independence in 1960. They have excelled in the Balkans, in Namibia where in the 1980s they were voted the best (under the command of Mr Ezidimma Ifejika) out of the police forces from 50 countries around the world, and in Haiti where some four years ago the United Nations performed a special ceremony in New York to honour the exceptional performance of our police officers. If our security agents perform outstandingly in international assignments but do not display the same quality at home, it follows logically that the problem is not in the nature of these men and women. The problem has to do with the local system. It has to be changed. But this is a matter for another day.

THE POWER SECTOR REFORM

The reform of the environment which we advocate for the intelligence and security agencies in Nigeria for optimum efficiency has since started in the electric power sector. True, the reform preceded the Jonathan presidency because the extant Electric Power Sector Reform Act was enacted by the National Assembly in 2005. Yet, the reform has become synonymous with President Jonathan because he has pursued it with far greater commitment than any other person. The Road Map for Power Sector Reform, which he launched on August 26, 2010, in Lagos to the applause of the Nigerian people and the international community, remains to this day the most comprehensive document on electricity development in Nigeria. Complete with timelines and costs over a considerable period, the interpretation of the Electric Power Sector Reform Act, as enunciated in the Road Map, makes the document truly a tour de force.

Some of the highlights of the Electric Power Sector (EPSR) Act of 2005 are the closure of the state-owned power utility named National Electric Power Authority (NEPA), its replacement with the Power Holding Company of Nigeria (PHCN) (though as a transitional company that would exist for only 18 months), the creation of 18 companies out of the state-owned power monopoly, the liberalization of the power sector and the consequent privatization of the 18 PHCN successor companies. There are other highlights like the creation of the Nigerian Electricity Regulatory Act (NERC) and the Rural Electrification Agency (REA)

ESPR(2005) ACT IMPLEMENTATION

It is a pity that sweeping and ambitious as ESPR(2005) Act is, its implementation has not been the best. For instance, the PHCN ought to have stopped to exist as a legal entity since 2007 (that is, 18months after the Power Reform Act came into existence), yet it still exists. The operation of the REA was suspended in 2009 following reports of the discovery of a 5.2 billion naira fraud allegedly involving top officers of the agency, the Ministry of Power and National Assembly members. The suspension was wrong because the REA is a creation of the law which, far from being amended or overturned, has remained in existence as it was enacted. The NERC leadership was also suspended in the wake of a purported uncovering of a fraud. The leadership compromising the chairman, vice chairman and commissioners was thus replaced with a sole administrator. The office of sole administrator was unknown to the law establishing NERC. The consequence of this executive action was that investor confidence in the legal and regulatory framework of the Nigerian power sector became threatened at many points. Investment in the sector dried up quickly. This is not surprising. Capital is a coward. It goes to the safest of places. That is why anytime the political stability of any place is threatened existing investors look for the nearest exit door and prospective investors thank their stars they have not fully parted with their funds.

COMPLYING WITH THE LAW

In recognition of the centrality of full compliance with the law, especially with the ESPR Act of 2005, in order to restore the confidence of investors and the general public in the power sector reform, President Jonathan decided from day one to make his administration adhere strictly to all relevant laws. The Rural Electrification Agency has been brought back fully. It now has a Managing Director, and not a sole administrator whom most people considered to be a more or less an undertaker. The REA has a reasonable vote in this year’s budget. Still, the funds available are still a far cry from its requirements. There are about 2,000 communities in Nigeria without electricity. This is not acceptable to the Jonathan Administration which regards electricity as a fundamental right of the Nigerian people. By the time the REA operations were suspended in 2009, there were some 1,970 ongoing electricity projects in various rural communities in the country. What is more, contractors handling REA projects are currently owed N3.2billion. Some of the contractors borrowed huge amounts from banks at high interest rates, with some having already lost the properties they used as collateral. Some of the contractors have unfortunately died, heartbroken, poor and still indebted.

As part of the commitment to the rule of law, President Jonathan has long reconstituted the leadership of the Nigerian Electricity Regulatory Commission. The leadership structure is now consistent with provisions of the ESPR Act. The result of all this is renewed confidence in the power sector at home and abroad.

SOME AFFIRMATIVE INDICATORS

At no time in our national history has the power sector in Nigeria excited the investor community as it has done since 2010 when President Jonathan resumed the implementation of the EPSR Act and followed it up with the launch of the Road Map for Power Sector Reform. He has done other things to demonstrate an unflinching commitment to the success of this sector. For example, he has long revived the Niger Delta Power Holding Company (NDPHC), which is the intervention agency implementing the ambitious National Integrated Power Project (NIPP). The NIPP will add about 4,700MW to the national grid. It is, among other things, adding 4,000 kilometers of transmission lines to the national electricity asset. The NIPP was in limbo for about three years preceding President Jonathan’s assumption of office. Under this dispensation, however, things are taking a new shape. Working in collaboration with the Senate, this Administration has been able to identify and recover hundreds of power equipment containers belonging to either the NIPP or the PHCN which were abandoned at the seaports for years or auctioned or declared missing. On Thursday, June 7, 2012, I went to one of the terminals in Ikorodu, Lagos State, to inspect some of the containers.

Given the Jonathan Administration’s devotion to Nigeria’s electricity development, it is not surprising that the international community, which has for several years adopted a largely negative attitude towards Nigeria, has demonstrated an unparalleled interest in the power sector. When the Bureau of Public Enterprises (BPE) called in 2010 for of Expressions of Interest (EoIs) in the privatization of PHCN assets, an unbelievable 331 EoIs were received. The EoIs came from reputable companies across the world. 135 of the EoIs have now been shortlisted by the National Council on Privatisation to bid for the assets next month. The bids will be processed and evaluated shortly after, and the results announced in good time. The entire privatization will be conducted in the finest tradition of transparency and in line with the best international practice. The privatization process must be concluded this year. As you know very well, the president has warned that in no circumstance will anybody be allowed to tamper with the process, nor can the date be shifted by even a second. I would like to state here for record purposes that the privatization timetable was shifted from March--May to July—October, this year, at the behest of prospective bidders.

It is also important to remark here that one of the 18 PHCN successor companies will not be privatized. The Transmission Company of Nigeria (TCN) will remain government-owned but managed by a firm with a robust record in this field. Manitoba Hydro international of Canada will from next month sign the management contract for the TCN. This is a major development in the reform of Nigeria’s power sector.


The World Bank has long keyed into the reform. It is providing Partial Risk Guarantee (PRG) to the Bulk Electricity Trader, a new firm established and its board appointed within the original timetable of the Road Map for Power Sector Reform. The PRG is to provide comfort and confidence to power producing companies. It assures them that any quantum of power they produce will be paid for. This firm assurance has become necessary because none of the 11 electricity distribution companies is right now creditworthy. Once they become creditworthy, the Bulk Trader will cease to exist because the distribution companies will now be dealing directly with power producers.

It is a measure of the international investor confidence in our reform that General Electric, the world’s largest electricity company, has signed a Memorandum of Understanding (MoU) with the Nigerian Ministry of Power to assist produce 10,000Megawatts within a decade. What is more, GE will take 10 to 15% equity in new plants. This is remarkable because even though GE has for decades sold turbines to Nigeria, it has never invested a kobo in the local economy. The icing on the cake is that GE will start to produce its turbines in Nigeria, the first time it will ever do so in West Africa. Siemens of Germany does not want to be left out. It has, therefore, decided to participate in the building of plants to generate 10,000MW in Nigeria. It will, in addition, lead a concerted effort to study how the traditional and alternative sources of power can be integrated in a seamless manner. Siemens will also build a service station in Nigeria, the first time it will have such a facility in the West African sub region.

The United States EXIM Bank signed, in the last quarter of last year, an MoU to provide 1.5billion dollar facility to firms operating in the Nigerian power sector using American products and services. The total amount of credit made available to Sub Sahara the previous year was $1.4b with $200m going to Nigeria. In other words, it is significant that a whopping $1.5b is now coming to the Nigerian power sector alone.

At this juncture, I would like to repeat the obvious: none of these firms is Santa Clause or Father Christmas. Each is rather run by hard-nosed businessmen and women. They are enthusiastic about the Nigerian power sector simply because they recognize that this is where the action is right now. Nigeria is a huge market. The telecoms companies are doing very well in it. Considering that power is a much bigger sector than telecoms, far-sighted businesses taking an advance position in respect of the ongoing power reform will benefit enormously from it. Prudent investors go beyond scary newspaper headlines to make key business decisions. Companies like Vodafone of the United Kingdom, which got swayed by stereotypes about Nigeria when it was invited to invest in the country’s GSM market following the liberalization of the telecoms sector in 2000, still regret their costly action.

CAPACITY EXPANSION

When President Jonathan assumed office in May, 2010, the quantum of power generated in Nigeria was about 2,800MW. The figure spiked by 1,000MW within one year. The increase was mostly through recoveries from existing plant capacities. By January, 2012, we were generating a record 4,400MW. The transmission infrastructure, which could not wheel 3,800MW in August of 2010 when the country generated 3,800MW for the first time, was able to wheel 4,400MW this time. This development meant a massive improvement in the transmission facilities. Of course, this kind of incremental improvement is not what a nation like ours needs, as we must leapfrog. It is, therefore, delightful that the president has approved the building of a Super Grid of 765kv, more than a double of the capacity of existing transmission lines which are either 132kv or 320kv.

The highest quantum of power which we have ever generated in Nigeria’s history is 4,400MW—and it was produced in January, this year. This quantum of power is far from satisfactory. Ours is a nation of 167m. South Africa, a nation of 47m, generates 40,000MW. Yet, South Africa has been suffering load shedding since 2008 because of insufficient power availability. In other words, if we produce 40,00MW by 2020, which is our national goal so as to become one of the 20 largest economies in the world, we should not rest on our laurels.

It is regrettable that by December, 2011, we could technically produce 5,500MW, that is, we exceeded our target by 500MW. Yet, only a little over 4,000MW was actually generated because of gas constraints. Seventy per cent of Nigeria’s power is generated from thermal stations while the remaining 30% is from hydro stations. Huge constraints with both sources of power account for the decline in power availability since the first week of March, this year. The nation expects that with the 12-month emergency in the gas sector which the Ministry of Petroleum Resources recently declared, there will be a substantial improvement in gas supply to the power sector. Still, the volume of gas available to the power sector will not be enough at the end of this period because we should then be capable to technically generate 9,000MW.

As regards power generation from the hydro stations, it is unfortunate that we are experiencing this year the lowest water levels in 10 years in the dams at Shiroro, Kainji and Jeba where the nation’s three hydro stations are located. With low water levels, very little power electricity can be generated from them. The good news is that we are devising a method to ensure availability of sufficient water in the dams all year round, whether there is a near drought in Nigeria or in any part of the West African sub region from where we derive floods to run the hydro stations. As you may have known, the current water problem in the dams arose from the near drought last year in neighbouring West African countries from where we get what is called black flood. This flood gets to its peak every November while the white flood, which refers to flood derived from within the Nigerian territory, gets to its peak in July of every year.

Before the end of July, there will be a remarkable improvement in power supply across the nation. Apart from improved supply from the hydro stations, there will be more gas for the thermal plants in places like Olorunshogo in Ogun State. What is more, some of the units at the NIPP plant at Ihonvbo in Edo State will have been commissioned. A minimum of 1,00MW will be added to the national grid this year, bringing the quantum of power delivered to the grid to 5,500MW. Unlike in the past when there would be an improvement in power supply in one month only for it to dip the next month, the improvement this time will not be reversible. It can only get better, from month to month and from year to year.

It should be added here that this Administration takes the question of electric power mix seriously. We are starting a 1,000MW coal-fired plant in Enugu, another in Kogi and yet another in Gombe. Nigeria’s coal is among the best worldwide, as it contains very little sulphur. Coal is the most significant source of electric power in the United States and South Africa, among other places. We are also developing in conjunction with the Federal Ministry of Water Resources the development of small dams across the country with a viewing to getting off grid electricity. Many of you may have known that the Ministry of Power is developing big hydro stations in Zungeru, Gurara and Mambilla. As part of the effort to diversify our power mix, a 10MW wind farm is about to be commissioned in Katsina. We are conducting studies to develop solar energy on a substantial scale, all the more so given the declining cost of developing solar energy. Studies are also being conducted on the possible use of nuclear energy. We are doing so fully aware that Japan has just phased out nuclear plants in its territory. Germany, another highly developed country, has also just taken a step against its development of nuclear energy.

DEVELOPMENT OF HUMAN CAPITAL

In recognition that human beings are both the means and the end of development, the Jonathan Administration, right from inception, decided to make the improvement of the welfare and capacity of the workforce in the power sector a priority. The president in 2010 requested the National Assembly to approve a 57billion naira vote in the supplementary budget for the payment of monetized benefits to PHCN employees which were denied them since 2003 when the Government introduced the monetization of fringe benefits to public servants. Some 99% of PHCN employees have since been paid; those yet to be paid are those with incomplete records, and each will be paid the moment the full records are presented.

In June, 2011, the Government approved a 50% increase in the salary of the PHCN staff to incentivise them for greater productivity. To enable a smooth takeoff of the new salary, the Government made available to the PHCN a 9billion naira grant (not loan) for the payment of the 50% increase for the months of June, July and August, 2011. The Government also decided to convert some PHCN 11,000 casual workers to the permanent staff, with even retroactive effect! As you are listening to this lecture, many of such workers are receiving letters regularizing their appointments. To make PHCN employees part owners of the 17 PHCN successor companies to be privatized this year, the Government has long decided to reserve a certain percentage of shares of the companies for only PHCN workers.

Worried at the abandonment since 1989 of the famous structured PHCN training programme of its staff, the Government has resolved to take the National Power Training Institute of Nigeria (NAPTIN) to a proper pedestal. The forthcoming boom in the power sector will require a huge infusion of well trained human capital into the system. Ten brand new Government-owned power plants will soon be commissioned, in addition to new substations all over the country. Independent Power Projects are also being established. Where are the human resources to run these facilities? This is why NAPTIN is critical to the success of the impending revolution in the power sector. NAPTIN is about to commence the training of 500 young engineers for one year so that they can become authentic power professionals.

TARIFF REVIEW


The Electric Power Sector Reform (EPSR) Act of 2005 vests in the Nigerian Electricity Regulatory Commission the power to adopt any tariff methodology it deems appropriate for the nation. NERC adopted some seven years ago the Multi Year Tariff Order (MYTO) methodology. This means a major tariff review every five years. The law makes it mandatory for NERC to adopt a tariff which is fair and just to the Nigerian people as well as to investors. The periodic major review does not necessarily imply an increased payment by every consumer. For instance, in the second MYTO, which came into effect on June 1, 2012 (even though it ought to have started on January 1), the less privileged ones in society who consume 50kilowatts hour or less in a month now pay less. They now pay N4 per kilowatt hour, instead of N7. Meters are now to be given them free of charge. They are no longer required to pay either for meter maintenance charge or fixed charge. In this year’s budget, there is a provision of an almost N50b subsidy for low income earners. This subsidy must be differentiated from the petroleum subsidy because, among other differences, there is no cash involvement at all in electricity subsidy. All the Government has tried to do is to prevent the less privileged from paying heavily for electricity consumption which is an item of need, and not an item of want.

The middle class now pays a slight increase of 11%, and not 88% which has been reported in some media. But rich peopl and other high end consumers now pay a cost reflective tariff. Different studies have shown that Nigerian citizens and businesses are willing to pay a little higher if guaranteed regular and quality electricity. The cost of electricity self generation is prohibitive. Besides, self generation pollutes the environment and even wipes out whole families who inhale carbon monoxide in their sleep.

The new tariff should enable the PHCN to generate up to N22.5b monthly, the irreducible amount it needs to make in order to meet its obligations to primary suppliers like Shell, Agip, Ibom Power, the NIPP and the Nigerian Gas Company. Indebted to the tune of N400m, the PHCN has hitherto been paying the International Oil Companies (IOCs) only 50% of their services. Should the IOCs be forced to carry out their long standing threat of stopping further supplies to the PHCN, it will be calamitous for the whole nation.

Indeed, more investments are critically needed in the power sector. Fresh investments of $10b annually are needed for the next decade to enable our country to generate 40,000MW by 2020 so that we can become one of the 20 biggest economies in the world by 2020. We must encourage companies like Shell, Agip, Siemens, Daewoo, GE and the rest to continue to have confidence in our country. After all, return on investment is much higher in Nigeria than in practically every country in the West. Investors in infrastructure are doing quite well, as demonstrated by those who have invested in telecommunications in the last decade. The power sector is the next theatre of action.

Let us conclude this conversation by calling to mind the title of a prophetic poem by the late distinguished South African writer and anti-apartheid activist, Dennis Brutus. In “The Sun On This Rubble” published in the 1980s, Brutus predicted that the racist government in South Africa would terminated within a few years. Cynics thought that Brutus was too optimistic. But the apartheid system did crumble irreversibly in the early 1990, and Nelson Mandela became South Africa’s first popularly elected president in 1994.

As the sun has been shining on South Africa since 1994, so it is about to start shining on the Nigerian power sector. God bless Nigeria.

ELECTRICITY TARIFF REVIEW IN NIGERIA. WHAT IS THIS RAUCUS ABOUT?
As June 1st approaches, every media in the country is awash with news about the review in Electricity tariff in Nigeria. Depending on whom you are listening to, you get different opinion. Different newspaper shout different headlines, some showing the true state of affair and others screaming like we are about to witness the apocalypse. Some scream “tariff rise for the poor” while government retort with “ it's a tariff review” always at pain to stress that the poor will actually be better off.

The unanswered questions by many are:
- Are Nigerians paying very low electricity tariff compared to their counterparts from other parts of Africa?

- Are the poor going to be better off due to this review in tariff which the government claims it is subsidizing?

- Who benefits from this review and who actually is made to pay more?

- How can tariff review encourage investors to chip into the power market in Nigeria?

For answer these questions, I dived into the government MYTO document and really took a hard look at the new rate of tariff and the thinking behind it and what I saw gives me hope that we have a thinking government. Before you shout “Judas” please take a look at the document again which is found inhttp://www.nercng.org/index.php/document-library/MYTO-2/MYTO-for-the-Layman/

I found that the formulator of the policy had the urban poor and rural dwellers in mind and heavily subsidies it for the R2 category too.

The argument from the government side has always been that we pay one of the lowest tariff in the west African sub region. I asked myself how they got their figure so I dived into the website of The Union of Producers, Transporters and Distributors of Electrical Power in Africa (UPDEA). A body, which was established in, May 1970 and has its headquarters in Abidjan, Cote d' Ivoire.

In 2010, UPDEA published a document, which it calls “The comparative study of electricity tariffs in Africa” see

http://www.updea-africa.org/updea/DocWord/TarifAng2010.pdf

Click on the link above and you will see that Nigeria pay one of the lowest Tariff in Africa. (This tariff cannot attract investors. Infact anyone will be foolish to invest in the power sector with this tariff)

If this document is anything to go by, then it is near criminal for the government to allow electricity tariff to remain the same; especially for the well off.

Some argue that the government should increase supply before thinking of a tariff review. That is such a plausible argument but my response is “how”? It will cost billions to give us at least between 30,000 to 50,000MW Nigeria requires to get constant electrical supply. Do you know how much MW we are currently generating? Close to 4000 that's just 1/7th percent of what we actually need. This is after successive government has invested in electricity in Nigeria. Only private investors who want a healthy return in their investments can actually provide such an amount. No government the world over will invest that kind of money in generating electricity. So for those clamoring for an improvement in the power situation before a tariff review, think again. How can Government make such an investment when other sectors of the economy are crying out for handout too. Government can decide to allow the exiting status quo and hope investor's come (even my uneducated grandma can posit that no one will invest in the sector if tariff remains like it is) or take action now and make it attractive for investors

This government has demonstrated a willingness to get the power situation right. It is going about it the right way and I will show you why I think so.

Firstly, it appointed a round peg in a round hole; a proven academia and a power person in the person of Prof Bart Nnaji. I have followed his career closely and I know he talks, eat and sleeps power. If Prof Bart Nnaji does not get it right in setting us on the road to a more sustainable power situation in Nigeria, then am afraid there is little hope left. He is doing all the right things to get it right. I dare to hope to he will get it right. I believe time will prove me right

Now what is he is doing that will make me dare to hope: Firstly, His determination to ensure that government has no business in running power in Nigeria. I take a close look at Prof Nnaji and each time I do, I see a Nigerian who puts the Nation first before his own desire. How else can you explain a government official who is enthusiastic about allowing private investors to take over what other corrupt officials in his shoes would have resisted because to them, it would have been taking from them an opportunity to loot. He is going about passing the message in a dignified manner and he understands how it works.

Secondly, it decision to privatize the industry gives me joy. See what happens to the telecom industry. Imagine that happening to electricity supply in Nigeria. I can see the smile on your face. It will happen. I read somewhere that all the power plants had been bided for and winners will be announced in October. A Canadian company has also won the bid to manage transmission, The power sector has attracted investment from USIM and General Electrics and things are looking up. Contrast this with the administrations of the past and even a die hard critic will agree that this government is doing this differently.

Lastly, the Independent Power Projects and most of the power and gas projects been completed and on schedule. This will ensure that the power situation improves. Because the availability of gas will ensure that power plans operating below capacity will be fired to full power and this will result in more megawatt and that means that my a/c will run longer, I will watch tv for longer and children can do their homework more longer. I dare to hope.

MYTO for the Layman
www.nercng.org

ELECTRICITY TARIFF REVIEW IN NIGERIA. WHAT IS THIS RAUCUS ABOUT?

As June 1st approaches, every media in the country is awash with news about the review in Electricity tariff in Nigeria. Depending on whom you are listening to, you get different opinion. Different newspaper shout different headlines, some showing the true state of affair and others screaming like we are about to witness the apocalypse. Some scream “tariff rise for the poor” while government retort with “ it’s a tariff review” always at pain to stress that the poor will actually be better off.

The unanswered questions by many are:
- Are Nigerians paying very low electricity tariff compared to their counterparts from other parts of Africa?
- Are the poor going to be better off due to this review in tariff which the government claims it is subsidizing?
- Who benefits from this review and who actually is made to pay more?
- How can tariff review encourage investors to chip into the power market in Nigeria?

For answer these questions, I dived into the government MYTO document and really took a hard look at the new rate of tariff and the thinking behind it and what I saw gives me hope that we have a thinking government. Before you shout “Judas” please take a look at the document again which is found in http://www.nercng.org/index.php/document-library/MYTO-2/MYTO-for-the-Layman/
I found that the formulator of the policy had the urban poor and rural dwellers in mind and heavily subsidies it for the R2 category too.
The argument from the government side has always been that we pay one of the lowest tariff in the west African sub region. I asked myself how they got their figure so I dived into the website of The Union of Producers, Transporters and Distributors of Electrical Power in Africa (UPDEA). A body, which was established in, May 1970 and has its headquarters in Abidjan, Cote d’ Ivoire.
In 2010, UPDEA published a document, which it calls “The comparative study of electricity tariffs in Africa” see

http://www.updea-africa.org/updea/DocWord/TarifAng2010.pdf


Click on the link above and you will see that Nigeria pay one of the lowest Tariff in Africa. (This tariff cannot attract investors. Infact anyone will be foolish to invest in the power sector with this tariff)

If this document is anything to go by, then it is near criminal for the government to allow electricity tariff to remain the same; especially for the well off.

Some argue that the government should increase supply before thinking of a tariff review. That is such a plausible argument but my response is “how”? It will cost billions to give us at least between 30,000 to 50,000MW Nigeria requires to get constant electrical supply. Do you know how much MW we are currently generating? Close to 4000 that’s just 1/7th percent of what we actually need. This is after successive government has invested in electricity in Nigeria. Only private investors who want a healthy return in their investments can actually provide such an amount. No government the world over will invest that kind of money in generating electricity. So for those clamoring for an improvement in the power situation before a tariff review, think again. How can Government make such an investment when other sectors of the economy are crying out for handout too. Government can decide to allow the exiting status quo and hope investor’s come (even my uneducated grandma can posit that no one will invest in the sector if tariff remains like it is) or take action now and make it attractive for investors

This government has demonstrated a willingness to get the power situation right. It is going about it the right way and I will show you why I think so.

Firstly, it appointed a round peg in a round hole; a proven academia and a power person in the person of Prof Bart Nnaji. I have followed his career closely and I know he talks, eat and sleeps power. If Prof Bart Nnaji does not get it right in setting us on the road to a more sustainable power situation in Nigeria, then am afraid there is little hope left. He is doing all the right things to get it right. I dare to hope to he will get it right. I believe time will prove me right

Now what is he is doing that will make me dare to hope: Firstly, His determination to ensure that government has no business in running power in Nigeria. I take a close look at Prof Nnaji and each time I do, I see a Nigerian who puts the Nation first before his own desire. How else can you explain a government official who is enthusiastic about allowing private investors to take over what other corrupt officials in his shoes would have resisted because to them, it would have been taking from them an opportunity to loot. He is going about passing the message in a dignified manner and he understands how it works.

Secondly, it decision to privatize the industry gives me joy. See what happens to the telecom industry. Imagine that happening to electricity supply in Nigeria. I can see the smile on your face. It will happen. I read somewhere that all the power plants had been bided for and winners will be announced in October. A Canadian company has also won the bid to manage transmission, The power sector has attracted investment from USIM and General Electrics and things are looking up. Contrast this with the administrations of the past and even a die hard critic will agree that this government is doing this differently.

Lastly, the Independent Power Projects and most of the power and gas projects been completed and on schedule. This will ensure that the power situation improves. Because the availability of gas will ensure that power plans operating below capacity will be fired to full power and this will result in more megawatt and that means that my a/c will run longer, I will watch tv for longer and children can do their homework more longer. I dare to hope.

MYTO for the Layman
www.nercng.org

MYTO for the Layman
www.nercng.org

ELECTRICITY TARIFF REVIEW IN NIGERIA. WHAT IS THIS RAUCUS ABOUT?

As June 1st approaches, every media in the country is awash with news about the review in Electricity tariff in Nigeria. Depending on whom you are listening to, you get different opinion. Different newspaper shout different headlines, some showing the true state of affair and others screaming like we are about to witness the apocalypse. Some scream “tariff rise for the poor” while government retort with “ it’s a tariff review” always at pain to stress that the poor will actually be better off.

The unanswered questions by many are:
- Are Nigerians paying very low electricity tariff compared to their counterparts from other parts of Africa?
- Are the poor going to be better off due to this review in tariff which the government claims it is subsidizing?
- Who benefits from this review and who actually is made to pay more?
- How can tariff review encourage investors to chip into the power market in Nigeria?

For answer these questions, I dived into the government MYTO document and really took a hard look at the new rate of tariff and the thinking behind it and what I saw gives me hope that we have a thinking government. Before you shout “Judas” please take a look at the document again which is found in http://www.nercng.org/index.php/document-library/MYTO-2/MYTO-for-the-Layman/
I found that the formulator of the policy had the urban poor and rural dwellers in mind and heavily subsidies it for the R2 category too.
The argument from the government side has always been that we pay one of the lowest tariff in the west African sub region. I asked myself how they got their figure so I dived into the website of The Union of Producers, Transporters and Distributors of Electrical Power in Africa (UPDEA). A body, which was established in, May 1970 and has its headquarters in Abidjan, Cote d’ Ivoire.
In 2010, UPDEA published a document, which it calls “The comparative study of electricity tariffs in Africa” see

http://www.updea-africa.org/updea/DocWord/TarifAng2010.pdf


Click on the link above and you will see that Nigeria pay one of the lowest Tariff in Africa. (This tariff cannot attract investors. Infact anyone will be foolish to invest in the power sector with this tariff)

If this document is anything to go by, then it is near criminal for the government to allow electricity tariff to remain the same; especially for the well off.

Some argue that the government should increase supply before thinking of a tariff review. That is such a plausible argument but my response is “how”? It will cost billions to give us at least between 30,000 to 50,000MW Nigeria requires to get constant electrical supply. Do you know how much MW we are currently generating? Close to 4000 that’s just 1/7th percent of what we actually need. This is after successive government has invested in electricity in Nigeria. Only private investors who want a healthy return in their investments can actually provide such an amount. No government the world over will invest that kind of money in generating electricity. So for those clamoring for an improvement in the power situation before a tariff review, think again. How can Government make such an investment when other sectors of the economy are crying out for handout too. Government can decide to allow the exiting status quo and hope investor’s come (even my uneducated grandma can posit that no one will invest in the sector if tariff remains like it is) or take action now and make it attractive for investors

This government has demonstrated a willingness to get the power situation right. It is going about it the right way and I will show you why I think so.

Firstly, it appointed a round peg in a round hole; a proven academia and a power person in the person of Prof Bart Nnaji. I have followed his career closely and I know he talks, eat and sleeps power. If Prof Bart Nnaji does not get it right in setting us on the road to a more sustainable power situation in Nigeria, then am afraid there is little hope left. He is doing all the right things to get it right. I dare to hope to he will get it right. I believe time will prove me right

Now what is he is doing that will make me dare to hope: Firstly, His determination to ensure that government has no business in running power in Nigeria. I take a close look at Prof Nnaji and each time I do, I see a Nigerian who puts the Nation first before his own desire. How else can you explain a government official who is enthusiastic about allowing private investors to take over what other corrupt officials in his shoes would have resisted because to them, it would have been taking from them an opportunity to loot. He is going about passing the message in a dignified manner and he understands how it works.

Secondly, it decision to privatize the industry gives me joy. See what happens to the telecom industry. Imagine that happening to electricity supply in Nigeria. I can see the smile on your face. It will happen. I read somewhere that all the power plants had been bided for and winners will be announced in October. A Canadian company has also won the bid to manage transmission, The power sector has attracted investment from USIM and General Electrics and things are looking up. Contrast this with the administrations of the past and even a die hard critic will agree that this government is doing this differently.

Lastly, the Independent Power Projects and most of the power and gas projects been completed and on schedule. This will ensure that the power situation improves. Because the availability of gas will ensure that power plans operating below capacity will be fired to full power and this will result in more megawatt and that means that my a/c will run longer, I will watch tv for longer and children can do their homework more longer. I dare to hope.

MYTO for the Layman
www.nercng.org

MYTO for the Layman
www.nercng.org