Power: TCN Requires Sustained Capital Investment of N823bn

15 Oct 2012

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Vice President Namadi Sambo

Chineme Okafor 

For the Transmission Company of Nigeria (TCN) to transit into a financially sustainable entity that can guarantee the transmission of generated electricity throughout Nigeria all year round, it would require a capital investment of  about N823 billion for five years.

According to a presentation prepared for the Bureau of Public Enterprises (BPE) by Principal Consultants British Power International, Brian Wales and Geoff Stott, such capital programme to boost the efficiency of TCN would have be executed between 2011 to 2016.

The presentation entitled: “Transmission Company of Nigeria; the Role of the Management Contractor for TCN,” was delivered to the Bureau of Public Enterprises (BPE) by the consultants on November 29, 2011 as part of preparatory efforts towards contracting a management contractor for TCN by BPE. It was obtained by THISDAY weekend in Abuja.

As part of its recommendation to BPE for the smooth management of TCN by a management contractor in Nigeria’s emerging power sector, the consultants noted that TCN is a strategic national asset that requires the appointment of a competent management contractor.

Contents of the presentation explained that the appointment of a management contractor was a critical step in the introduction of a commercial orientation to Nigeria’s power sector, adding that such move will facilitate essential investments in Nigeria’s transmission network.
It read: “One of the 18 successor companies ‘unbundled’ from PHCN; set up as a corporate entity in 2006. Transmission Company of Nigeria is a national strategic asset, to be retained in state ownership for the time being.  Owners of the transmission system, 132kV and above, responsible for its efficient operation, maintenance, expansion and reinforcement. Capital programme 2011-2016 will require between N618 and N823 billion.”

It is however not clear if BPE eventually adopted the presentation by the consultant but TCN has since July 2012 been managed by Manitoba Hydro International of Canada on a $23 million (N3.68 billion) three-year management contract signed with the Federal Government.

The Federal Government has also proposed to allocate N74.26 billion to the power sector in the 2013 appropriation bill it presented to the National Assembly last week, but it is yet to be known how much will be spared for expansion of Nigeria’s transmission networks in 2013.

TCN performs three principal functions Market Operations (MO), System Operations (SO) and Provider of Transmission services (TSP). The appointment of a management contractor for TCN is part of the measures by the government to revive the power sector.

Although, it is still retained by the government but Manitoba is expected to inject expertise in its capital programme planning and delivery, provide clear targets and incentives to deliver efficient transmission service in the sector, as well as bring in experience on market development and evolution of the MO, SO and TSP functions.
The management contractor will also enable knowledge transfer to, and development of TCN Nigerian staff.

Tags: News, Nigeria, Featured, Power, TCN, Capital Investment

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