With Nigeria, generating only 4,000megawatts of electricity, Ejiofor Alike writes that after 52 years of nationhood, the power sector has failed to deliver
Nigeria’s power sector has a chequered history, spanning over nearly 12 decades since 1896 when a 20MW-capacity power generator was installed by the British in Ijora area of Lagos under the Public Works Department (PWD).
In 1929, the Nigeria Electricity Supply Company (NESCO) was established as a power utility company by the Europeans, resulting in the construction of a hydroelectric power station at Kuru near Jos. The British colonial administration was later to install more generators in Kaduna, Ibadan, Enugu and Kano, which were under the PWD. However, electricity supply was confined to government quarters and homes of influential citizens.
But when the Electricity Corporation of Nigeria (ECN) was established in 1950, it was given a mandate to supply electricity to all Nigerians, who could pay electricity bills. This was followed by the construction of the first 132KV transmission line from Ijora in Lagos to Ibadan.
Advent of Hydro Power
With rising demand for power supply, the ECN in 1951 commissioned a study of the hydroelectric potentials of the River Niger, Nigeria’s longest river. As a follow up, the Federal Government commissioned Netherland Engineering Consultant (NEDECO) in 1963 to carry out hydrological survey of the Niger and Benue Rivers.
In 1958, the ECN contracted Balfour Beatty Company Limited to specifically study hydrological potentials of the Niger, around Jebba in the present day Kwara State. The two Engineering Consulting Firms – NEDECO and Balfour Beatty, published their joints reports in 1961, with a recommendation that the first dam be built at Kainji.
Accordingly, the power sector marked a major milestone in 1963 when the Niger Dams Authority (NDA) was established to develop the hydropower potentials of the country. NDA was created by an act of parliament to pursue the Kainji project.
With the enabling legislation, IMPREGILO, a consortium of three Italian companies – Impresit, Giriola and Lodigian – was contracted almost immediately to execute the project. The project commenced in 1964 with the foundation stone laid by the then Prime Minister, the late Alhaji Abubakar Tafawa Balewa.
Funding for the Kainji project was provided by the federal government; Government of Netherlands; International Bank for Reconstruction and Development; Institute Di Credito per le Imprese Di Publica Utilita; and UK Export Credit Guarantee Department. The project was first commissioned in 1968 by retired Gen. Yakubu Gowon, with more units coming on stream in 1976 and 1978 to bring Kainji’s total capacity to 760MW.
The survey on hydropower potential in the country further led to the establishment of the 540MW Jebba Power Station on the River Niger, and the 600MW Shiroro Power Station on the Kaduna River, one of the tributaries of the River Niger.
The Shiroro Hydroelectric Power Station, built 550 metres downstream of the confluence of Kaduna River in Niger State, was officially inaugurated by the then military president, retired Gen. Ibrahim Badamasi Babangida on June 20, 1990. Technical commissioning had started with Unit 411G4 being synchronised to the national grid on October 3, 1989, while Jebba was completed in 1984.
To consolidate efforts in boosting electricity supply, both the ECN and NDA were merged in 1972 to form the National Electric Power Authority (NEPA). Following the creation of NEPA, the sector witnessed a boom in the 1970s and 1980s, which was boosted by the construction of gas fired power stations in Lagos and the Niger Delta. However, during this period rural areas were not connected to the grid.
Period of Neglect
Electricity supply, however, witnessed a slump from the 1990s due to government neglect. During this period, supply from the hydro power stations in Kainji, Shiroro and Jebba was declining, while electricity consumers grew in number. With obsolete equipment and lack of maintenance, generation from the hydro stations continued to drop, without any deliberate effort by the Federal Government to build additional power stations.
Long years of neglect continued in the power sector and by 1999, Nigeria with a population of over 100 million was generating 1,500MW of electricity. During the same period, countries like Iran, South Africa and Indonesia, with smaller populations and were generating the same quantity of electricity with Nigeria in the 1960s, had hit over 30,000MW each.
During the years of military rule (1966 -1979) and the period of civilian rule between 1979 and 1983, very few Nigerians had access to electricity supply. In other words, supply was constant until access to power supply was opened for more Nigerians, including the rural dwellers.
With increasing demand for electricity supply by more Nigerians and without a corresponding increase in power generation, the power infrastructure collapsed in 2000 shortly after the commencement of the current democratic rule in 1999.
The system was in such a dismal stated, collapsing several times over a 24-hour period that the then Minister for Power, the late Mr. Bola Ige, and the then Managing Director of NEPA, Mr. Bello Suleiman traded blames on the pages of newspapers. The drama climaxed when the NEPA boss, who was removed by former President Olusegun Obasanjo, was alleged to have refused to hand over, worsening the chaotic state of the sector.
The crisis in the power sector prompted Obasanjo to sack the NEPA board and in its place, set up a nine-man technical committee headed by the current Governor of Cross River State, Senator Liyel Imoke, who was later appointed Minister for Power and Steel. The setting up of the committee to probe the inefficiencies of NEPA signalled the beginning of the current power reform, which actually started in 2001.
During his second term, Obasanjo again dissolved the NEPA board headed by Alhaji Umaru Ndanusa, and replaced it with a new technical committee, also headed by Imoke, who was by then the Minister for Power and Steel. The committee had a mandate to run the affairs of NEPA and see it through the privatisation process.
With the National Electric Power Policy produced by the Power Steering Committee of the National Council on Privatisation, a new draft legislation was sent to the National Assembly, thus paving the passage of the Electric Power Sector Reform (EPSR) Act of 2005 in March 2005, which gave fillip to the power reform programme.
The Act created the Nigerian Electricity Regulatory Commission (NERC) and also to the creation of the Power Holding Company of Nigeria (PHCN). With its establishment, PHCN was broken up into 11 distribution companies, six generation companies, and one transmission company
However, the administration of the late Yar’Adua suspended the reform initiative, as well as all the power projects initiated by Obasanjo under the National Integrated Power Project (NIPP), targeted to inject over 6,000MW into the national grid. This was a major setback for the power sector, which was not reversed until the current administration of President Goodluck Jonathan revived the NIPP projects. Today, most of the 10-medium-sized gas-fired NIPP power plants are at over 80 per cent completion.
Jonathan also revived the power reform plan with the sale of PHCN assets reaching advanced stage of completion, while electricity generation has been increased to around 4,200MW.
Summarising the country’s experience in the last 52 years, a Lagos-based lawyer and investment advisor to some of the investors that seek to acquire the PHCN assets in the on-going privatisation process, told THISDAY that long years of military rule was responsible for the stunted development of the electricity sector.
He stated that during the early period of military rule, the military neglected the sector, adding that only high-brow areas and seats of power had access to electricity. “In those days, electricity was a national cake meant for only a privileged few. The military built only few power stations to cater for the needs of the high and mighty,” he said.
He noted that the return to civilian rule changed the situation and expressed the hope that with the level of investment in the last six years, coupled with the current reform measures, the country was on the right track.
However, a top official of one of the unions in the power sector told THISDAY that with the privatisation programme, the country’s power sector was heading for doom. “Can you name one government agency that became successful after it was privatised? All the privatised entities are colossal failures and the electricity sector cannot be an exception. Time will vindicate us,” he said.