Century Power Generating (CPG) Limited has said the epileptic power supply witnessed in Nigeria could become a thing of the past if the government allowed market forces to determine pricing in the entire value chain from the generation of power to distribution.
In a chat with journalists in Lagos yesterday, its Chief Executive Officer, Chukwueloka Umeh, said the entire value chain is presently dysfunctional and broken.
According to him, he believes that the major issue with the power sector is that the government has continued to regulate tariffs and the price of gas.
This he stated would continue to discourage investments in the power sector, adding that “rather than allow market forces to determine the price for gas, the government continues to regulate the price, which in itself discourages any form of investment.”
Umeh said the same applies to the distribution companies, which he said were unable to attract funding because the present fixed tariffs cannot guarantee an adequate return on investment.
He, therefore, called on the federal government to replicate the deregulation model that was adopted in the telecoms sector, which resulted in the creation of thousands direct and indirect jobs as well as boosting its economic growth.
“How can you pay your loans when there are many things like metering still unsolved? A lot of the networks are not properly metered; a lot of the networks have lines and transformers that are very old. You also have a lot of networks where people are stealing power from. So if you’re collecting money for only 30 per cent of the power you’re given, how can you pay for the part that you’re supplying?”
“So at the end of each month, you cannot pay the generating companies (Gencos) that supplied power to the grid you get power from. Now because you cannot pay them, the generating companies also cannot pay the transmission companies. It’s a vicious cycle of failure,’’ Umeh lamented.