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Towards Effective Power Sector Reform

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The power sector is one of those sectors of the Nigerian economy that has received critical attention within the past 57 years of the corporate existence of the country as an independent state.
As part of measures to attain desired impact and maximal results in the power sector, vast treaties and hypothesis have been made over the past years, while billions of tax payers money have been sunked in.
The prospect of development, remains but a flicker, a mere shallow reflection of the expected breakthrough from the huge investment invested into the sector.
However, as the country marks its 57 independence celebration, Nigerians are desirous of the full dividends of the huge investment in the power sector.
The fact been that effective power supply is what is needed in the country to drive entrepreneurial growth and enterprise development among the teeming masses and create job opportunities.
Pundits have blamed the challenges in Nigeria power sector reforms on many factors.
One of such factors identified is the use of similar approach or methodology in solving power sector problems, thereby resulting in same old inefficiencies.
Apart from apparent diversion of fund meant for the resuscitation of the ailing sector, the lack of input of real technocrats and experts in policy making and implementation, has also been pointed as been responsible for the woes in the sector.
Musing over the prospect of development in the Nigerian power sector, an expert, Engr. Isaac Adekanya said the lapses in the sector reform were traceable to some missing links in the operation of the power sector.
Adekanya, who is the Port Harcourt branch Chairman of the Nigeria Institute of Electronic, Electrical engineers, disclosed in an exclusive interview with The Tide, that the Nigerian power sector was yet to attain synergy in the three major areas that constitute the sector, such as Power Generation (Genco) power Distribution (DISCO) and Power Transmission (Transco).
According to him, not all the power generated in the country are transmitted and distributed to the end users.
“There are a lot of technical challenges in the generation, transmission and distribution of power in the country. Most of the power projects carried out in the country have no consideration for the distribution and transmission of the generated electricity to the end users. An example is the Omoku power project, which is a huge investment but had not been able to make maximal impact because of the challenges of transmission and distribution”.
Adekanya, who is also a fellow of the Nigeria Society of Engineers said similar challenges exist in the transmission of generated electricity to the National Electricity Centre at Osogbo. He said most of the power generated are wasted along the line before they get to the end users.
In his view, the concentration of generated electricity at the Osogbo Power Centre where the needs of consumers across the country are decided may not be serving the best interest of the various sections of the country.
He noted that such discretionary measures in the allocation of power may not truly represent the electricity demands of the various states of the nation.
Alternatively, Engr. Adekanya suggested that power generation, transmission and distribution should be based on comparative economic advantage, as the various parts of the nation have peculiar natural advantages in strategic location of energy sources.
“The various parts of Nigeria are disposed with vast energy sources that can be explored based on comparative advantage. In the north, there is abundance of solar energy source, in the middle belt there are rivers that can be harnessed for hydro power generation while the Niger Delta is blessed with enormous gas potentials for thermal energy.
“These energy sources can be explored fully to serve the power need of the various areas where they are located. The idea of evacuating generated power to Osogbo before distribution may not be entirely the best option for the country. Nigerians are in serious need of electricity to do their business. It is regrettable that at 57, the country still runs a generator economy”.
Adekanya, who is a proponent of diversification as the panacea for effective power sector reform, also faulted the allocation of the DISCO by the federal government.
He said the DISCOs were given out on political consideration rather than competence and liberalisation.
He noted that the conspicuous absence, or non involvement of experts with the requisite technical knowhow in the DISCO stifles development in the sub-sector, as those involved are more concerned about profit motive than effective service delivery.
He therefore advocated for full liberalisation of the DISCO for more players to be involved on a note of competition in service delivery as in the case of the telecommunication industry.
In his submission, another expert in renewable energy, Elder Elkanah Hanson said the future of Nigeria’s industrialisation depended on renewable energy which is a global phenomenon.
Elder hanson, who spoke with The Tide correspondent in Port Harcourt recently, said nations of the world are taking advantage of renewable energy to serve their electricity needs.
The elder statesman, pointed out that Nigerian electricity laws were based on colonial orientation and as such do not serve our peculiar development need.
To attain sustainable development in power sector reforms, he called for a total revocation of the obsolete electricity laws and adoption of inventions that are best suited for our polity.
Elder Hanson, who described the concentration of generated electricity at Osogbo as “economic piracy”, said the major problem with Nigeria was its behemoth federal status, that disposses the component units of the country from developing at their own pace.
He called for total restructuring of the centralised federal structure of the country and added that electricity should not be the exclusive reserve of the Federal Government.
“At 57 Nigeria has come of age and should not be toddling again. It is ridiculous that we are still battling with defects in the power sector, our value system must change. The fight against corruption must be thorough and complete. The Federal Government should declare a state of emergency in the power sector. The lumping of power ministry with works and housing is wrong. The power ministry should be made to stand on its own and an expert should be saddled with the responsibility of running the ministry”.
Meanwhile, the Federal Government has stated that it was not against states building their own power projects to support incremental power.
Minister of power, works and Housing, Babatunde Fashola disclosed this at a meeting of the National Council of Power (NACOP) held in Jos, Pleateau State recently.
The minister explained that the law allows states to embark on electricity distribution under license through the Nigeria Electricity Regulatory Commission (NERC).
Fashiola further hinted that in the Power Sector Recovery Programme (PSRC) of the Federal Government, states are vested with enormous responsibilities to ensure that, “their residents comply with safety standards on building by not building on the right of way of 332/133,33 and 11KVA lines”.
He also urged states to encourage their residents to pay for consumed energy while the metering issue and estimated billing is addressed.
Fashola, who described the meter system as cost effective, called on state governments to set up debt verification teams with audit capacity to ascertain the debt profile and develop a payment plan which can be budgeted for. This he noted will help liquidity issues and contribute to the power sector reforms.
Considering the importance of power in the economic development of any nation, the 57th Independence anniversary of Nigeria offers an avenue for a critical review of the power sector for better service delivery.
The fact remains that competence and not politics should be the criteria for participation in the power sector. This will give more room for innovation and efficiency.

Taneh Beemene

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AEDC Confirms Workforce Shake-up …..Says It’ll Ensure Better Service Delivery

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The Abuja Electricity Distribution Company(AEDC) has announced a major restructuring exercise as part of efforts to reposition the utility firm for improved service delivery, operational excellence, and stronger customer focus.
In a statement issued by the AEDC management late last Thursday, the company said the move aligned with its ongoing corporate transformation strategy designed to make AEDC more agile, innovative, and customer-centric.

As part of the restructuring, the company said it had promoted high-performing employees, released retiring staff, and disengaged others whose performance fell below expected standards.

It added that it has also begun implementing a comprehensive employee development and customer management plan to strengthen its service delivery framework.

“In line with its corporate transformation strategy, Abuja Electricity Distribution Company has announced a restructuring exercise aimed at delivering improved services to its customers as well as enhanced operational efficiency and excellence.

“The restructuring is in line with our strategic direction to become a more responsive and efficient organisation, capable of delivering world-class service to our customers.

“As part of the transformation, the Company has promoted high-performing staff, released retiring employees and those performing below par, and has put in motion the implementation of a robust employee development and customer management plan aimed at driving AEDC’s customer-centric focus,” the company said.

AEDC noted that the reforms are part of its broader commitment to provide reliable, safe, and sustainable electricity to customers across its franchise areas, including the Federal Capital Territory and the states of Niger, Kogi, and Nasarawa.

The firm further pledged to continue investing in infrastructure upgrades, digital technologies, and operational innovations to improve service reliability and customer satisfaction.

“With a strong commitment to delighting its customers, AEDC continues to contribute to the growth and development of Nigeria’s energy sector through investments in infrastructure, innovative technologies, and sustainable practices.

“AEDC consistently seeks to improve the quality of life for its customers, promote efficient energy usage, and actively engage with its communities,” the statement added.

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Economic Prosperity: OPEC Sues For Increase In Local Crude Oil Refining 

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The Chairman of the Organisation of the Petroleum Exporting Countries (OPEC) Board of Governors, Ademola Adeyemi-Bero, has advised local oil refiners in Nigeria to increase in-country refining of crude, noting that value creation for crude oil will support economic growth and development.
Adeyemi- Bero who gave the urge at the Nigerian Association of Petroleum Explorationists Pre-Conference Workshop in Lagos, insisted the country must move away from decades of crude exports and focus on retaining value within the local economy.
He said, “We’ve been an oil and gas exporting country. We produced oil; once there was oil, we put it in a tank and sent it abroad. 40 or 50 years later, people blame Shell and others, but I don’t. They are businesses looking for feedstock for their industrialisation. If you give it to them, they’ll still take it.”
Adeyemi-Bero, who is also the Chief Executive Officer of First Exploration & Petroleum Development Company, said Nigeria had a responsibility to develop its energy resources locally and use them to drive industrial growth, rather than depend on foreign markets, adding that President Bola Tinubu would have returned fuel subsidies if the Dangote refinery had not been there to produce fuel locally.
”Just look at the impact the Dangote refinery has had on foreign exchange and gross domestic product growth. You can imagine what would have happened if that had occurred 50 years ago. If the president had said, ‘I’m cancelling subsidies, and I’m not going to allow multiple exchange rates.’ We didn’t have the option of having petroleum products in this country; I’m sure he would have changed his policies and gone back to subsidies. It’s as simple as that. Let’s not over-aggregate.
He continued, “If you go to Saudi Arabia today, if you go to the UAE, if you go to Qatar, if you go to Malaysia, if you go to Brazil, they are expanding the value chain and keeping it in their space. Now, one man built a refinery; we fought him, we argued with him. But the impact of that Dangote refinery on our GDP and foreign exchange is big.”
According to him, local refining and crude utilisation would also help stabilise the naira and strengthen the nation’s economy.
“If we can sell some oil in naira, let’s do it if it works for both parties. The strength of the naira is what it commands in trade. This is why nobody wants the naira outside this space, but the day you can pay for oil in naira because both parties agree, it strengthens the naira,” he said.
Adeyemi-Bero stressed that Nigeria must deliberately reduce its dependence on exports and focus on value creation to avoid future economic decline.
“We need to decline exports. All of us like to sell, but the person who will buy from us will be willing to buy at the right price. ‘I’m investing in dollars, so don’t come and buy in naira. If I invest in dollars, then pay me in dollars.’ But we could make that happen,” he stated.
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Local Content key To Africa’s Energy Future~NCDMB’S Scribe

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The Executive Secretary, Nigerian Content Development and Monitoring Board (NCDMB), Engr. Felix Omatsola Ogbe, has advised African nations to transform their abundant hydrocarbon resources into shared prosperity for their citizens and economic development.
He said to achieve this objective, the African nations have to make local content policies and their effective implementation the cornerstone of their energy future.
Ogbe made the recommendation at the 4th edition of African Petroleum Producers Organisation (APPO) conference and exhibition on local content in Africa, held in Brazzaville, Congo, recently.
The Tide gathered that the event was dedicated to advancing local content implementation and energy development in Africa, and was attended by industry stakeholder across the continent.
The Board’s Executive Scribe led the Nigerian delegation as well as represented the Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri at the APPO’s statutory ministerial council meeting.
Referencing the continent’s rich endowments of over 125 billion barrels of proven crude oil reserves, contributing over 10 percent of world’s crude oil supply, and over 620 trillion cubic feet of natural gas, Ogbe posited that African countries would not derive optimal value from their hydrocarbon resources without implementing local content policies, thereby creating value from their industry’s operations and connecting other sectors of their economies.
 “Nigeria’s experiences and successes over the past 15 years provides a living example of what deliberate local content policy can achieve”, he said.
Ogbe however stressed that local content is not merely a regulatory framework, but rather it was a development strategy which must be implemented with pragmatism.
“Local content represents our resolve to build indigenous capacity, retain value within our borders, and create sustainable jobs for our young and dynamic population.
Ogbe restated the NCDMB’s commitment to sharing its expertise, learnings, frameworks, and digital tools with other African petroleum producing countries to strengthen local participation across the continent.
He confirmed that the Board’s vision extends beyond Nigeria, adding that the agency has built institutional frameworks that can serve as models for other African nations.
The templates according to him include the local content policy design, implementation structures, monitoring templates, and digital compliance systems like the NOGIC Joint Qualification System (NOGIC JQS).
Speaking further, he canvassed the establishment of an African Energy Services Network to foster collaboration among member states of the African Petroleum Producers Organisation (APPO) for better value retention in the continent’s oil and gas projects.
The NCDMB’S Executive Secretary stated that the Network would add a fresh layer to the strategic vision that birthed such continental organisations as APPO, African Energy Bank, and the African Continental Free Trade Area (AfCFTA), whose collective focus is the advancement of intra-country trade, local content and cross-border linkages to achieve energy security and rapid economic development in Africa.
“It would be a framework where fabrication, manufacturing, and engineering hubs across the continent complement each other, creating a pan-African industrial ecosystem with existing capacities of Nigeria available to drive transformative processes,” he added.
He expressed satisfaction with the establishment of the African Energy Bank, an initiative championed by APPO and Afreximbank for competitive financing in aid of oil and gas projects in Africa, promising that NCDMB stands ready to collaborate, providing technical expertise and project linkages to make the Bank’s objectives a reality.
 While urging all stakeholders to demonstrate equal commitment to the Bank to facilitate real growth and sustenance, he noted that the audience which comprised oil and gas policymakers and stakeholders from across the continent that Nigeria has built world-class infrastructure, such as the multibillion-dollar Egina FPSO Integration Yard at LADOL Free Trade Zone, Lagos.
“The Egina FSPO integration yard at LADOL is a first-of-its-kind facility in Africa. It successfully integrated a Floating Production Storage and Offloading Unit, with a storage capacity of 200,000 barrels of crude oil.
“The facility can serve as a regional hub for FPSO and modular platform integration for the Gulf of Guinea and beyond.
“The NCDMB had established oil and gas parks in Bayelsa and Cross River States to host manufacturing companies producing equipment and components for the oil and gas industry, and thus offering opportunities for small- and medium-scale enterprises (SMEs) and prospective investors to participate.
“The NCDMB’s Centre for Research and Development (R&D) programme fosters collaboration between the academia, industry, and start-ups, is also available for joint African research initiatives to develop African solutions for African problems”, he said.
Giving further insight on the Board’s programmes, the Executive Secretary, said the Board, through its Human Capacity Development (HCD) programmes, has trained over 20,000 Nigerians in specialised oil and gas skills, which could serve as a model replicable across African energy-producing countries.
He indicated that Nigerian service companies are desirous to forge joint ventures with their African counterparts to deliver engineering, marine, fabrication, and digital energy services.
 “In addition, cross-border investments in modular refineries, gas processing plants, and local manufacturing could be promoted”, Engr. Ogbe added.
The Tide gathered that other senior officials of the Board made presentations and participated in panel discussions at the event where they showcased Nigeria’s successful local content models, drawing commendations and interests from different countries eager to understudy and implement some of Nigeria’s models in their industries.
By Ariwera Ibibo-Howells, Yenagoa
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