FG Appeals To Governors of South East Region to Help Secure Right-of-Way –Way For Power Projects


FG Appeals To Governors of South East Region to Help Secure Right-of-Way –Way For Power Projects

The Federal Government said the lack of right of way has inhibited its power projects in the Southeast and therefore appealed to the governments to help it secure the right of way so that some of the power transmission projects could be resolved.

 It stated that several power projects were completed several years ago, but they could not be energized because of the difficulties it has encountered over right-of-way in the region.

 Speaking at Enugu today during the Light South East Project, the Minister of Power, Adebayo Adelabu disclosed this in the presence of the five South Eastern Governors present at the occasion.

He said the Light–Up South East power project has been structured to solve the major challenges in the Nigerian electricity supply industry since the privatization.

 “The lingering infrastructural constraints, especially in the transmission and distribution network, this is an accumulated problem that has been there in the past decades which we have not fully attended to, and we believe that for us to have stable and functional, reliable and uninterrupted electricity, it must be dealt with, especially the evacuation of power generated  through the Transmission Company of Nigeria and the distribution of this power to the door steps of households, business, and industries.”

“Secondly, we have experienced liquidity problems, manifested in payment deficits, across the various value chain from payment to gas supply to payment for power delivered at the distribution level.

According to him, presently about N1.3 trillion is owed to the power generation companies, about $1.3 billion, to the gas supply companies, pre-2014, if we add this together at today’s exchange rate, it is more than N3trillion, which sector will operate effectively and efficiently with a debt overhang of over N4thrillion. We must address if the industry must move forward.”

He said this is the reason why the sector has not been attractive to both local and international investors. “We also need debt capital in this sector. Which bank would be bold enough to put its money in the sector where there is no sight of how the money would be paid back? So a lot of the lenders have distanced themselves from this sector.

The light up South East will attract finances for the required infrastructure upgraded, It will use metering and related technology to achieve payment assurance.”

 He said things are going to be done differently, as they will prove to investors that if they put their money, they will recoup their investment, and that investment recovery assurance is required. Smart meters will be used to ensure that electricity bills are collected from consumers.

 He said the objective is to enable businesses to achieve savings from the exorbitant cost of self-generation and increase their output and remain focused on their core business operations.

“Today, over 50 percent of industries due to instability in our electricity sector are completely off the grid, they now have captive powers in their factories, where they generate their power. you can imagine the number of industries with separate power generation, but it is not economically viable for us as a country, because every other thing is passed on the cost of the goods produced and eventually passed on to the prices of these commodities which is the major driver of the inflation we have seen today in food, services and commodity prices across the length and breadth of Nigeria.

The minister stated that the components of the project will include designing financing, development, operating and managing the last mile distribution and where necessary transmission infrastructure to secure, safe, and reliable delivery to the customers.

 He said they want to operate a seamless operation of the entire value chain from generation, to long-distance transportation and to delivery which is distribution to the households consumers.

 The Light Up Nigeria is designed as a bilateral to move away from the back purchase arrangement with the Nigeria Bulk Electricity Trading Company NBET to now more bankable bilateral sense that will achieve:

1. Efficient power dispatch that minimizes technical losses through newly built or upgraded transmission and distribution infrastructure with protection against unauthorized connections or networks in the process of transporting power

Damilola Bello

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