Tackling Power Rejection by Discos

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On account of the inability by distribution companies to strengthen their networks to evacuate electricity, power generation was limited to an average of 3,847.8MW per day in the first 104 days of 2018, reports Ejiofor Alike

Before the private investors took over the electricity assets on November 1, 2013, generation was the weakest link in the electricity value chain.
While the distribution and transmission infrastructures could withstand electricity generation of up to 4,500MW, the generating plants could only occasionally attain this level as a result of inadequate gas supply and the poor maintenance of several units of the hydro and gas-fired power plants.

Low generation had resulted in constant grid instability as the Transmission Company of Nigeria (TCN) could not guarantee the stability of the transmission network when power generation dropped below 3,000 megawatts.

Though generation first hit an all-time high of 4,402.2 on December 21, 2012, it had always hovered around 3,000MW on several occasions before the sale of the power assets, thus causing grid instability.

The frequent system disturbances at that period were partly caused by inadequate gas supply to the generating plants and the poor state of the power stations.
However, after the private investors took over the power assets, some of the new investors invested heavily in the generation assets, thus putting much pressure on the transmission assets, which became the weakest link in the value chain.

It is on records that while Transcorp Plc doubled the capacity of Ughelli Power Station from its 300MW post-privatisation level, the new investors that bought the 1,320MW capacity Egbin Power Plant have also raised the plant’s electricity generation to almost its name-plate capacity, with a clear roadmap to double it in the foreseeable future.

Many new NIPP power stations sponsored by the Niger Delta Power Holding Company have also come on stream while old power stations have recorded milestones in their generation levels since privatisation, despite the huge debts owed them by NBET for power generated.

The federal government, with the support of international donor agencies, has also strengthened the transmission grid to have the capacity to wheel the increased power generation to the distribution companies.
Today, the total installed capacity of the hydro and gas-powered generation plants is 11,165.40MW, compared to the pre-privatisation level of below 10,000MW.

The available capacity, which can be generated if gas and water are available, and all the units of the generating plants working, has also increased from less than 6,000MW in 2013 to 7,139.60MW
TCN also has a wheeling capacity of 7,000MW, but its actual operational capacity is still 5,500MW.
However, only very few distribution companies have demonstrated financial capacity to upgrade their distribution network to be able to evacuate the increase in generation.

Available supply statistics from the Advisory Power Team in the Office of the Vice President, Prof. Yemi Osinbajo, showed that from January 1 to April 14, the country produced a total of 400,171 MW of electricity, which represented an average daily supply of 3,847.8MW.
Within the period under review, the country was not able to generate 261,944 MW of power as a result of power rejection by the Discos, as well as a combination of gas, water and transmission constraints, thus bringing the country’s average daily power loss to 2,518.7MW.

Investigation revealed that most of the Discos are only concerned on how to boost monthly revenue and have resorted to estimation of bills and deployment of all kinds of modern technology to facilitate bill collection, without reasonable investments to allocate more power to consumers, thus fueling the nationwide discontent.

With the apparent failure of the Nigerian Electricity Regulatory Commission (NERC) to enforce its well-designed guidelines on estimated billings, some aggrieved customers, including military personnel, have resorted to self help by attacking Disco officials, who are on revenue drive to collect outrageous bills for power that was not supplied.

However, majority of the aggrieved electricity consumers nationwide have lost their rights to protest against outrageous bills, having been cowed to submission by some Discos, who engage the services of the police, Civil Defence, military personnel and even social miscreants to intimidate and in some cases, arrest and falsely charge protesting consumers for obstruction.

THISDAY gathered that the Discos’ public posturing that they lose money by estimating bills is different from actual reality as only few of them are seriously committed to providing pre-paid meters.
Even customers with non-prepaid but functional meters are all slammed with exorbitant estimated bills, without recourse to the current or previous readings on their meters, contrary to NERC guidelines.

Power rejection by Discos
As electricity consumers groan under the excruciating effects of exorbitant estimated bills and poor electricity supply, the distribution companies have been accused of rejecting even the small volumes of power that are available for distribution as a result of their weak distribution infrastructure to evacuate the generated power.
TCN had, last week, raised the alarm about another looming system collapse as a result of the volume of idle power waiting for evacuation.

TCN’s Assistant General Manager, Operation, Mr. Smart Omo Omoragbon reportedly advised the Discos during a media tour of Ikeja West Transmission Sub-station in Ipaja-Ayobo of Lagos to recapitalise to boost their distribution capacity.
Omoragbon dislosed that despite TCN’s existing capacity, load rejection by the Discos, which causes frequent system collapse, would persist, unless the Discos upgrade their network to be able to distribute loads.

He added that TCN was able to expand its wheeling capacity as a result of government funding, stressing that the private investors in the distribution value chain should recapitalise to be able to distribute their power allocation. The issue of power rejection by the Discos first took the centre stage late last year when the TCN disclosed that between August 27 and September 3, 2017 – a period of eight days, the 11 Discos refused to take up and distribute a total of 22,277.53 MW) of power produced by power generation companies.
According to TCN, the Discos had rejected an average of 2,784.6 MW produced daily by the Gencos, which the TCN was willing to transmit.

Discos’ untenable claims
In their initial reaction to TCN’s allegation, 11 Discos under the aegis of the Association of Nigerian Electricity Distributors (ANED) had promptly denied rejecting electricity supplied to them, stressing that it was natural for electricity demands of their customers to drop at night, pointing out also that such drop had been misrepresented by the TCN as load rejection.

ANED’s spokesperson, Mr. Sunday Oduntan, reportedly told the media that the TCN had frequently misinterpreted energy readings of the Discos by miscalculating drop in electricity demand from customers at night as load rejection.
He insisted that the Discos’ stations had capacities that were higher than the energy allocation from the grid, but often received less from the transmission network.
“What has happened is the inaccurate rendering or misinterpretation by the System Operator (SO) of Discos’ minimum and maximum load readings. The SO in its recent allegation of load rejection against Discos wrongly projected the load drop/demand, during off-peak hours (night times) as load rejection.

“This is not, and cannot be labelled as load rejection by Discos. Naturally, Discos take and distribute more energy during the day time/business hours than night time when demand is generally low due to lesser demand. The unfair interpretation of off-peak energy data as load rejection is grossly inaccurate and misleading,” Oduntan reportedly said.
“The unfair interpretation of off-peak energy data as load rejection is grossly inaccurate and misleading. The occasional times Discos have been unable to distribute energy received are directly due to the inadequate TCN infrastructural interface with the Discos,” he added.

Oduntan accused the TCN of indiscriminate load dumping to impractical network areas that make distribution inefficient, unviable and impracticable for technical and commercial efficiencies, due to poor infrastructure construction, substandard materials and inefficient reckless approvals of grid extensions for political considerations and interference during the days of NEPA/PHCN.

Barely a month after ANED’s initial response, the association apparently indicted its members when it reportedly alleged that due to TCN’s constraint in transmitting to a particular area, the transmission company deliberately channels electricity to areas where the consumers in one way or the other avoid payment of their bills.
According to him, since the Discos were already operating at a huge loss with the current tariff regime, it did not make economic sense for them to accept power, pay for it and distribute to where there would be no return.

“The issue of load rejection needs to be put in context. We buy electricity and we sell. We are expected to pay the cost of whatever we purchase to the generators of which we have not been able to meet up. The facts and figures are there for anybody to check. If I am buying a product at N68 and I am only legally allowed to sell that product for N31. 58 as is the case now, it then means that even if I am able to collect 100 percent of the expected, I still cannot pay for the product 100 percent. This means, for me to still manage and stay in business, I need to have the product where I can get my money. That is not to say that we are not going to distribute electricity to everybody,” Odutan had explained.

As logical as the Discos’ argument was, their revelation further exposed the apparent lack of capacity of the distribution companies to fulfill their obligations as contained in the privatisation agreement, which provides that they must reduce collection losses and not give excuses that customers have refused to pay.
Consumers have argued that the most convenient way to reduce collection losses is not to reject power but to provide meters as only very few irrational consumers will object to the payment of monthly bills, which the customers genuinely consumed.

After all, no Disco pays for power supplied by the Gencos based on estimation as all the power supplied to the Discos by the Gencos are properly metered.
Discos will also revolt if NBET imposes arbitrarily exorbitant bills on them for power they did not purchase.
So, when consumers are arbitrarily assigned exorbitant bills for power they do not consume, it fuels public resistance as in the present circumstance where the Discos deploy the police, military and social miscreants to effect disconnection for non-payment of unjustifiable bills.

Some consumers have also held the view that rejecting power allocated to some areas because the consumers do not pay electricity bills is a convenient excuse for the Discos to deny R1 and R2 customers power and concentrate the power in areas populated by high demand customers, thus defeating the one of the major objectives of the power privatisation, which was to reduce poverty by stimulating small businesses, and entrepreneurship, to boost the country’s GDP.