Demola Rewaju: Electricity by 2015- No light at the end of the tunnel

by Demola Rewaju

nigeria electricity

For me, it is a personal disappointment as I had promised some people that I would vote for Goodluck Jonathan in 2015 if only he can ensure steady power supply as he’d promised – a promise that I now see no realistic way of keeping or being kept.

Sometime last year I was contacted by an international magazine run from South Africa to write an article on the power situation in Nigeria. The pay was good and I felt it was a worthy challenge so I took it up and developed a better than the layman opinion of the sector. In the past few months, President Goodluck Jonathan has stated on international media that there is improvement in the power delivery to the people – statements that were greeted on both occasions with denunciation from the people who should know – the end users.

It may have been a true reflection of the situation if GEJ had said that there were improvements in the power sector but these strides are yet to reflect in the delivery of electricity to the people who need it. The power sector reforms started during the tenure of President Olusegun Obasanjo with the passage of the Electric Power Sector Reform Bill into law in March 2005 but suffered some setbacks during late President Umar Yar’Adua’s time as he tried to start his own reforms but Goodluck Jonathan has successfully built on the reforms started in OBJ’s period. NEPA was rebranded and unbundled into 18 different companies – one transmission company (TRANSCO), six generation companies (GENCOs) and eleven distribution companies (DISCOs). The DISCOs and GENCOs were sold to private individuals who bring with them a wealth of experience in private sector management and can attract international funding for the power sector. Names like Femi Otedola, Tony Elumelu, Sir Emeka Offor and co are some of those behind the renewed efforts to improve the delivery of electricity supply and the signs are visible already – the DISCOs are becoming more open in relating with customers – I got my last PHCN bill with a note that had a customer service representative’s phone number on it and this morning in the PUNCH newspaper, there is an advert with several phone numbers and an announcement that walk-in customer service offices would soon be open to the public.

It’s not all in private hands however – the Electric Power Sector Reform Act also provides for a regulatory body – National Electricity Regulatory Commission (NERC) which will ensure that there are no arbitrary increases in the price consumers pay. This is to be achieved by the Multi Year Tariff Order (MYTO) that would review the tariff every five years. The present tariff order started on the 1st of June 2012 and maintain the same tariff regime until May 31, 2017 but there are rumors of possible increase in the tariff or the fixed service charge of N750 at the moment.

The major hurdle in my opinion will be the bulk of workers in the employ of PHCN who had initially asked for N 384 billion as the cost of disengaging all PHCN workers only to turn around and insist that the FG should issue letters of appointment to 40,000 casual workers under the severance benefits scheme which will shoot up the settlement bill far above the N384 billion that government had envisaged for that purpose and had set aside from the proceeds of the privatisation process. The first hurdle was scaled but there remains the issue of those still in the employ of these private companies. They are still the marketers, the service operators, the technicians and so on and they have become accustomed to a system that frustrates the best of government’s intentions.

From the moment the government failed to handover the companies to the private investors on schedule according to its own timetable due to the intransigence and greed of the labour movement, there was bound to be ripple effects and one of it has just surfaced: the Transitional Electricity Market was supposed to commence from the first of March 2014 but that has been shifted and it was announced by no less a person than Dr. Sam Amadi, the head of the government agency (NERC) who should be enforcing the rules. He was flanked during hte announcement by the representatives of the investors who are holding forte for potential foreign investors. The TEM period would have brought much needed respite for the consumers as it makes it mandatory for the Nigerian Gas Company to ensure steady delivery of gas to the GENCOs failing which it would be sanctioned.

There is also the problem of lack of funds on the part of the investors and that is why about two weeks ago, there was a conference in Abuja to raise awareness in the international financial world about this investment opportunity for international investors. My major question would be: why then did people purchase companies when they had no funds to improve the generation or distribution of electricity? That some rich people have once again managed to inject themselves into what should be a smooth process as middlemen is worrisome and may bring to naught all the efforts of this government to move the sector forward.

These three factors: the entrenched system in the minds of PHCN workers, government’s failure to adhere to its own timetable and the lack of developmental funds by the initial investors make it impossible for me to see any light at the end of the tunnel. For me, it is a personal disappointment as I had promised some people that I would vote for Goodluck Jonathan in 2015 if only he can ensure steady power supply as he’d promised – a promise that I now see no realistic way of keeping or being kept.

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Op-ed pieces and contributions are the opinions of the writers only and do not represent the opinions of Y!/YNaija.

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