Over 400mw generated by Okpai power plant stalled by lack of PPA

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CBN

PDF) Power Sector Reform in Nigeria: Challenges and Solutions Power Sector  Reform in Nigeria: Challenges and Solutions
Olusola  Bello
As Nigerians continued to suffer from acute supply of electricity, quite a good number of  the power  generated are stranded because of lack of good infrastructure. But another seriuos issue  confronting the sector is  the inability of the power  generating companies to secure Power Purchase Agreement (PPA) .
One of such situation is the 450 megawatts of electricity stranded at Okpai Independent Power Plant,due to lack of Power Purchase Agreement( PPA) between the  Nigerian Bulk Electricity Trading (NBET) and  the company producing the power.
The PPA is yet to be secured more than one and half years  after the upgrading of the plant was completed.
The power plant which has since been upgraded to about 930megawatts capacity from 480mw has been having challenges pushing the extra capacity power generated to consumers because Nigerian Bulk Electricity Trading (NBET) Plc  could agree to take the power.
The Okpai power plant is operated by is the Nigeria Agip Oil Company, the joint venture partner of the Nigerian National Petroleum  Corporation.
However Business Standards gathered that it is not only Okpai Poser plant that has this issue as other generating companies are facing the same problem.
An industry source said that one of the major reasons has  been that the Transmission company of Nigeria (TCN)does not have the capacity to will these stranded capacities.
He said the government is currently wary about the capacity  of  TCN and advised that the generating companies should  collectively approach the TCN for a dedicated grid that would wheel the excess powers and the current national grid is too fragile to hand the volume of stranded power across the country.  He said doing so would make the price of power more competitive.
The other thing that is responsible for this stranded power, he explained, is the fact that the Nigerian Electricity Regulatory  Commission (NERC) has not been forceful on the enforcement of the eligible customers regulations which would helped to evacuate some of these powers from the plants to consumers.
But an officer of the commission told Business Standards the Eligible Customer regulation has provided adequately for any electricity generating companies enough latitude to operate with the realm of eligible customers.
To support the provision of power supply in Nigeria, the Independent Power Plant (IPP) Okpai Phase II project was initiated by the Nigerian Agip Oil Company (NAOC), to increase the plants existing power generating capacity of 480 MW by a further 450 MW to provide a total 930 MW output into the Nigerian power supply grid.
The additional power generation is provided by means of a combined cycle gas turbine plant with two gas turbine generators and one steam turbine generator located 60 km south west from Onitsha in Delta State, close to the River Niger.
Nigeria’s potential to become one of the world’s largest economies will remain just an aspiration without the electricity required to pursue aggressive industrialisation, including the revitalisation of moribund local industries.
Furthermore, the acknowledgement that economies thrive with a virile small and medium scale enterprise culture makes it even more imperative to transform the Nigerian power sector.
With problems, such as the one expressed above, achieving  greatness economically, analysts say would  be a mirage that

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