President Goodluck Ebele Jonathan, in his foreword to his administration’s ‘Road Map for Power Sector Reform: A Customer-Driven Sector-Wide Plan to Achieve Stable Power Supply’ (August 2010), did say: “The availability of reliable electric power to the homes and businesses of our citizens has been one item in our national life that we have approached with so much hope and yet experienced so much frustration over the past decades. Various regimes in the distant past paid little attention to the sector. But in the recent decades, subsequent regimes have put in billions of naira to reverse the neglect and mismanagement which characterised the sector. As President and Commander-in- Chief of the Armed Forces, I and my Vice President, Arc. Namadi Sambo (GCON), are conscious that what we do with the Nigerian electricity supply industry will go a long way in determining whether Nigeria remains in darkness or joins the rest of the world in the race for development…”
Among other strategic permutations, some of the highlights of the Road Map include the removal of obstacles to private sector investment in the power sector, which involves the establishment of an appropriate pricing regime; establishment of a bulk purchaser; provision of government credit enhancement; creating an efficient and motivated workforce; operationalising NELMCO (Nigerian Electricity Liability Management Company Limited); contracting out the management of the Transmission Company of Nigeria (TCN); clarifying and strengthening the licensing regime; and ending the trend of inconsistent policy implementation. For its part, the Federal Government announced a strategy on the divestiture of Power Holding Company of Nigeria (PHCN) successor companies namely: hydro power generating plants; thermal generating plants (GENCOs); the Transmission Company of Nigeria (TCN) and the Distribution Companies (DISCOs).
The FG went ahead to break the jinx holding back the privatisation of the PHCN and its forebears for decades on November 1, 2013, when it finally sold and handed over the power generation and distribution companies to private investors in an exercise that involved the creation of 18 successor outfits from the PHCN, comprising one transmission, 11 distribution and six generation firms. The transmission company was not sold like others, as the FG hired a foreign company, Manitoba Hydro International, to manage it.
But almost 12 months after the purported takeover by private investors, national power output has stagnated between 3,000MW and 4000MW. What this means is that public electricity supply is still as epileptic as it has been before the privatization of PHCN. Indeed, happenings in the power sector presently make a mockery of the high hopes President Jonathan raised in his introductory remarks in the Road Map document. And like the President rightly said, past regimes sunk billions of naira into non-fruitful efforts to revive the nation’s power sector. Some reports claimed, for instance, that former President Olusegun Obasanjo government spent over $16 billion to improve power generation between 1999 and 2007 with little to show for it. But the PHCN said it received a total of N521 billion or $4.07 billion during the period under focus. Between the late President Umaru Yar’dua era and that of Jonathan, the amount spent on the power sector remains a guess work, until may be after his exit from power. But a good guess is that it would run into billions of dollars as well. Allegations of corruption trailing the sector are also quite resounding, while moonlight tales of perennial gas shortage and inefficiencies hindering power supply have become a way of life for Nigerians.
The truth remains that electricity consumers in Nigeria are groaning under ridiculously poor supply of the product on daily basis, but paying heavily for power they hardly consume. A recent report said the FG had approved the sum of N213 billion ($1.3b) for the private electricity companies to upgrade power infrastructure and stabilize output at 5,000MW by next year. Officials were quoted as claiming that no FG money would be involved, and that the fund would be sourced from commercial banks through the Central Bank of Nigeria (CBN). But even if secured from the moon, the N213 billion facility questions the rationale behind the privatization of the PHCN, as well as the capacity of the private investors to stabilize the power sector as was envisaged by the FG. The Jonathan Presidency should seriously think of how to remedy the frustrating power situation. The sector is not just working for a population of over 170 million people.
