•Our commitment to transform Nigerian power sector unwavering, Abbas declares
Adedayo Akinwale in Abuja
Vice President Kashim Shettima yesterday, admitted that Nigeria was underperforming in providing electricity supply that is reliable, affordable, environmentally sustainable and available to all Nigerians.
The vice president disclosed this in Abuja, during the Power Sector Stakeholders Interactive Dialogue/ Workshop organised by the House of Representatives.
Shettima, who was represented by Sadiq Wanka, said by some estimates, less than 20 per cent of Nigerians have access to reliable energy of more than 12 hours per day, adding that 45 per cent of Nigerians have no access to any form of electricity.
He explained: “At a moment that the energy quadrilemma is at the forefront of global discussions, in Nigeria, there is widespread recognition that we are underperforming across all four pillars of providing electricity supply that is reliable, affordable, environmentally sustainable and available to all Nigerians.
“Indeed, by some estimates, less than 20 per cent of Nigerians have access to reliable energy of more than 12 hours per day. 45 per cent of Nigerians have no access to any form of electricity. And as a result, households and industry have been dependent on self-generation that is both more expensive and more polluting.”
Shettima stressed that the Electricity Act 2023, that was passed by the National Assembly and signed into law by President Bola Tinubu seeks to overhaul the structure of the Nigeria Electricity Supply Industry.
He said it proposes a structure that promotes more competition and greater scope for tailoring power solutions to local needs, while transitioning to a market structure that would attract much needed investments and promote environmental sustainability.
According to him, the wholesale structural shift that the Electricity Act 2023 (as amended) and the associated constitutional amendment usher in, means we need to double down on ensuring an orderly transition to the new national electricity market framework.
Shettima stressed that in addition to the urgent need to adequately define what the new national electricity framework was the introduction of new state electricity markets raises two prominent questions.
“Having the power to regulate electricity activities also means there is a need to build the capacity to ensure competent and independent regulators in each state market.
“It means states need to take a leading role in attracting investments to recapitalise distribution companies, and to ensure a steady flow of investments towards increasing electricity access,” he added.
Shettima, noted the second key question that becomes immediately apparent was how to prioritise coordination and orderliness in the transition.
He explained that it was important that investors have clarity and confidence in the roadmap and timelines for transition and for there to be a base level of standardisation across electricity markets so that dealing with different regulatory bodies does not become too cumbersome and force investors to stay away.
The vice president added that there was need to maintain a level of flexibility in the transition process.
He noted: “For example, transitioning to state regulatory control requires distribution companies to set up state subsidiaries. But this is not a straightforward process.
“There are complex issues of asset delineation, equity negotiations with other investors in DISCOs and even infrastructure investments required to truly delineate the distribution network of one state from the other.
“There is a lot of re-organisation that needs to happen internally within DISCOs from a process and people perspective. All these among others require time and patience.
“In tackling these issues, the federal government is committed to being a partner to the state governments and facilitating the shift towards increased state government participation in the electricity market as envisioned by law.
“This will require an open channel of communication to adequately plan the transition, and respond to issues as they emerge. It will require a willingness to leverage all the knowledge that has been accumulated over the last decade of operating the current market structure, and to learn from the mistakes and successes therefrom.”
Also, the Speaker of the House of Representatives, Hon. Abbas Tajudeen, said the commitment of the House to transforming the Nigerian power sector into a model of efficiency and sustainability was unwavering.
He noted that the government’s objective was clear – to foster a resilient, efficient, and sustainable power sector capable of supporting the nation’s ambitious economic and developmental goals.
Abbas, stressed that historically, the Nigerian power sector has grappled with challenges that have stifled its growth and hampered its efficiency.
He explained that these challenges included inadequate generation capacity, dilapidated infrastructure, frequent disruptions in power supply, and financial inefficiencies that have eroded the sector’s viability.
The Speaker was of the opinion that critical problems within the electricity value chain need to be addressed, adding that technical and commercial losses, which have not been effectively tackled, add inefficiencies that consumers are indirectly forced to cover, contributing to the cost recovery efforts, saying these losses amount to billions of naira.
