₦airaland Forum

PRESS RELEASE

DECLINING POWER OUTPUT ATTRIBUTABLE TO GENERATION SHORTFALLS AND GAS SUPPLY LIMITATIONS

No sensible person will invest in a sector that operates under a regulatory price cap with prices below production cost. The gas sector needs $20bn worth of investments. Who will bring money to invest in this mess? We have abundant gas, but we don't have the needed investments.

Gas producers are hesitant to supply Gencos because Gencos also operate under a price cap and they can't get their full payments from Discos and NBET, Discos also operate under a tariff cap. Subsidy has destroyed the entire value chain. If subsidies were that effective, where are Nigerians still poor of after years of subsidy payments.

The more subsidies grew, the more poverty expanded. Allow a market-driven price model and a willing buyer-willing seller arrangement. We can't subsidise our way out of poverty.

naptu2:
It's inevitable, the ridiculous subsidy has got to go!

naptu2:
Dr Toks (Akpakomiza) @fimiletoks



https://x.com/i/status/2027336901468791203

naptu2:
Dr Toks (Akpakomiza) @fimiletoks



https://x.com/i/status/2027336901468791203

Sangoamadioha1:
Nigeria's one cure for all our problems, 'remove subsidy'.
A very lazy way of confronting issues. Like fuel, make una remove am and make we see if any thing apart from price go change 😒

Sangoamadioha1:
Nigeria's one cure for all our problems, 'remove subsidy'.
A very lazy way of confronting issues. Like fuel, make una remove am and make we see if any thing apart from price go change 😒

naptu2:
Nigeria Independent System Operator @OFFICIALNISO_NG



https://x.com/i/status/2027303108758347930

nairalanda1:
The problem is our power sector needs investment and no one is going to invest in a sector where there is subsidy.

That is because you won't see adequate profit and return on investment because for most consumers government is setting prices to the point where ROI is impossicant.

Let me put it this way, you got two bakery business you want to invest in.
One of them is located in a state where they sell bread at a price of 200 naira when it costs 2000 naira to bake one loaf because the state government has brought in price controls and the subsidy they pay doesn't cover potential rises in production costs.

In the other state , bread is sold for 2600 per loaf , the same cost to bake it as the other state. Where would you invest your money.?


Ivory coast and Ghana stopped subsides on their power sector. Last time ivory coast had system collapse was in the 1980s. They privatised and removed subsidies in 1993.

naptu2:
1) When was the last time that we experienced fuel scarcity?

2) If you were actually being serious you would have proferred your own solution rather than attacking another person's

fineboynl:
you don’t know what you are talking about. There are some secrors that needs government regulation. Because the economy of the country is within them. Any wrong move can cause massive inflation fuel and energy. India electricity is subsidize and very cheap for the poor. So how are theu doing it? You cant run America style economy in india because it won’t work. The people are poorer and not in the same status. Rent are not the same and wages are not the same.

Sangoamadioha1:
1) Under the reduction in fuel scarcity is due to local refining of petrol.

2) Transmission of electricity is our major problem. Upgrade the transmission facilities and the situation will get better.

The annual funds being released to the power ministry is enough to remedy these things.

Djyucee1:
We have not tapped 2 percent of our gas reserve and yet we lack gas for power generation. Who cursed Nigeria abeg? To think of it , if there is abundance of gas now to generate electricity,evacuation ll be a problem due to poor grid

nairalanda1:
The problem is our power sector needs investment and no one is going to invest in a sector where there is subsidy.

That is because you won't see adequate profit and return on investment because for most consumers government is setting prices to the point where ROI is impossicant.

Let me put it this way, you got two bakery business you want to invest in.
One of them is located in a state where they sell bread at a price of 200 naira when it costs 2000 naira to bake one loaf because the state government has brought in price controls and the subsidy they pay doesn't cover potential rises in production costs.

In the other state , bread is sold for 2600 per loaf , the same cost to bake it as the other state. Where would you invest your money.?


Ivory coast and Ghana stopped subsides on their power sector. Last time ivory coast had system collapse was in the 1980s. They privatised and removed subsidies in 1993.