… govt agreed on the concession of the 700 Megawatts Zungeru Hydroelectric Power project
Despite asking the Market Operators to discontinue its disconnection exercise of those defaulting participants in the electricity industry, the minister of Power, Abubakar Aliyu is now crying out loud to say that the cost of electricity consumption in Nigeria is the cheapest in the world.
The Market Operators disconnected some of its customers from the national grid because they defaulted, but the minister had to intervene stating that the consequences of the action of MO would be severe on consumers.
Abubakar Aliyu on Thursday declared that the cost of electricity consumption in Nigeria is the cheapest and most defaulted by consumers in the world during an interactive session with the Senate Committee on Power, and heads of various agencies in the power sector.
He stated that electricity is highly subsidised in Nigeria by the Federal Government, which makes it the cheapest across the globe.
He backed his claim with a comparative analysis of the cost of electricity in Nigeria and those of neighbouring countries.
He said: “Cost of electricity in Nigeria is the cheapest across the globe, particularly, gas-to-power, which is highly subsidised.
“For example, while the cost of electricity in Nigeria is 15 cents per kilowatt, it is 42 cents in Niger Republic, 23 cents in Republic of Benin, 25 cents in Mali, 28 cents in Senegal, 27 cents in Burkina Faso etc.”
He lamented that while the government is doing everything possible to make electricity affordable and available for Nigerians, many ordinary consumers and even critical agencies of the government, default in payment of bills.
Supporting the minister’s view, Managing Director of Transmission Company of Nigeria (TCN), Sulyman Abdulaziz, said high rate of defaults on electricity bills by critical government agencies led to the disconnection of distribution companies (DisCos) in Kaduna and Kano from the national grid, recently.
He said that although they have been temporarily reconnected, they must pay through the affected DisCos to TCN within a 60-day grace period.
As a way out of the problem, the Chairman of the Committee, Senator Gabriel Suswam, and other members, like Senators Adamu Aliero and Yusuf Abubakar Yusuf, suggested the Ministry of Finance make a deduction from source, with regards to the bills of defaulting agencies.
Suswam said one of the complaints by the DisCos, particularly, those in Kaduna and Kano, was enormous debt incurred through defaulters.
He said: “The DisCos, as stated in the written complaint, specifically, mentioned military formations across the country, educational institutions, state governments etc.”
The minister also disclosed to the committee that the federal ministry of power agreed to concession the 700 Megawatts Zungeru Hydroelectric Power project.
He pointed out that the Zungeru Hydroelectric dam was financed jointly by China Exim Bank and the Nigerian government.
“All the best practices and regulations have been complied with to ensure that Nigeria is not shortchanged in the concession agreement,” Aliyu said
Meanwhile, the over 20,000 landlords in Aba, the Abia state commercial nerve centre, have lauded the Minister of Power, Engr Abubakar Aliyu, for his intervention last weekend in the disconnection of feeders belonging to the electricity distribution companies in Aba, Kaduna, and Kano that were cut off from the national transmission network for debts owed Federal Government agencies in the power sector.
While all 29 Aba Power feeders were cut off for 10 days as a result of the N896m indebtedness that threw the entire Aba Ringfence comprising nine local government areas into darkness, three Kaduna Electricity Distribution Company feeders were taken off the national grid for four days for owing the Transmission Company of Nigeria (TCN) N33bn.
In a letter to the power minister made available to journalists the Aba Landlords Protection and Development Association (ALPADA), led by Chief Alphonus Udeigbo as the president general and Engineer Leonard Onyemesiri as the deputy president general, expresses gratitude to the minister “for heeding the call to cancel the erroneous disconnection order by the Transmission Company of Nigeria made against the Aba Power Electric Company Ltd which was obviously a breach of the market rules”.
Pledging to ensure that all their tenants and businesses pay their bills promptly henceforth, the landlords noted that the order by the TCN “threw Aba and environs into darkness, untold hardship and humongous economic and human losses”.
In a previous letter last week to the Minister of Power, the landlords accused the TCN of breaching the 2010 Nigerian Electricity Industry Market Rules by giving Aba Power 30 working days from April 19, 2023, to clear its debt, but cut it off from the grid a few hours later.
The TCN violated its own decisions and rules with impunity, they said.
They also accused the Market Operator, a unit in the TCN, of contravening the market rules by not informing Aba Power of the decision to disconnect it from the country’s transmission network.
In separate letters to President Muhammadu Buhari, the Senate President, the Speaker of the House of Representatives, the Attorney General and Minister of Justice, the National Security Adviser, the Inspector General of Police, and the Director General of the Department of State Security, among other key government officials, the Aba Landlords vowed to lead a peaceful protest this week to the Alaoji Transmission Substation on the Aba outskirts and occupy it if the order against Aba Power was not lifted immediately.
“Though the TCN order against Aba Power is deplorable”, according to Cliff Eneh, a respected energy consultant in Lagos who used to be a lecturer in engineering after leaving the services of the Texas Power and Light Corporation in the United States as well as the defunct Power Holding Company of Nigeria, “because it was the first time in Nigeria’s history that an entire area covered by a distribution company has been plunged into complete darkness, the situation would have been far worse for the whole nation if services at the Alaoji Substation were allowed to be disrupted.
“This critical transmission substation supplies power to the Southeast and the South-south but also to the North.
“It is, therefore, a good thing that the Honorable Minister of Power intervened and forestalled the imminent shutdown of the Alaoji substation”.
Both Aba Landlords and Engr Eneh commended the minister for extending the grace period granted the Aba, Kaduna, and Kano DisCos to cure their debts to 60 days, stating that the minister must have taken into consideration the three months Nigerians suffered acute hardships arising from scarcity of petrol and naira from January to March which affected the electricity users’ ability to pay their bills.
Aba landlords, meanwhile, have joined the call for the probe of TCN’s Market Operator, Dr Edmund Eje, for the selective punishment against Aba Power.
“It is most disheartening that Aba is the only DisCo ever completely disconnected from the national transmission network on the ground of a debt, which is almost insignificant compared with that of every of the other 11 DisCos in the country”, they said.
“It is the only one disconnected for up to 10 days, with severe consequences, and the only one given 30 business days to pay, but taken off the grid within hours rather than allow the period to expire”.
According to Chief Udeigbo, the ALPADA leader, selective actions like these ones tend to do grave violence to investor confidence in Nigeria, especially in the power sector which needs plenty of investments.
He declared: “The Market Operator must be investigated to stop further abuse of office and assure the investing community that Nigeria is serious about attracting investments in the power sector and protecting the investments”.
Olusola Bello