Poor electricity supply is increasingly making Nigerians more nervous than ever
Almost a decade after the privatisation of the power sector, most Nigerians have come to the inescapable conclusion that the process through which countries like India, Singapore and a host of other contemporary emerging economies successfully used to reset their electric power challenge is proving too difficult to be applied effectively on our shores. On Monday, the whole country was thrown into darkness when the national grid crashed to zero megawatts (MW) for the eighth time this year.
The story of power supply in Nigeria has been that of motion and no movement. We have gone through layers and chains of committees; we have experienced commercialisation; we have witnessed the “un-bundling” of the power sector and privatisation. Yet, nothing seems to have changed. From Kano and Calabar to Sokoto and Port Harcourt, there is hardly any part of the country that does not experience power failure on a regular basis. In most places, for several days and sometime, weeks, many people have no access to electricity to lighten the burden of living. Meanwhile, consumers are paying more and getting less power at a time the exchange rate makes both generators and diesel prohibitive.
Before now, the common excuse for grid collapse was always that the transmission lines could not wheel the power so generated by the generating companies (GENCOS). The more recent one was however attributed to vandalism of some transmission infrastructure. But the distribution companies (DISCOS) that were the beneficiaries of the shambolic power sector reforms have all failed to invest in modernising and expanding the transmission lines. To address the challenge of the sector would require addressing the perverse incentives within the system and weak regulation. Even though we have the capacity to generate about 12,500 MW, the grid cannot take more than 5000 MW. Nigerians are yet to feel the impact of the billions spent on Mambilla, Zungeru, and indeed, the work that Siemens is doing with Transmission Company of Nigeria (TCN).
Hardly a week passes without either the 26 electricity generation companies (Gencos), the 11 distribution companies (Discos) and the lone transmission company (TCN), which is still within government’s control, trading blame. But whatever may be the excuses, it is also true that other stakeholders in the power sector, including—if not especially—the federal government, have contributed to the challenge of electricity supply in Nigeria. For instance, the government has frequently fiddled with the statutory exercise of allowing for a cost reflective tariff for the market to encourage further investments and growth. There are serious systemic issues across the power value chain that need a holistic approach to being solved.
In a report published last year, the World Bank rated Nigeria as the poorest country in the world on power supply to citizens with 85 million people not connected to the grid and a loss of $26 billion annually. With everybody supplying their own electricity, Nigeria is one of the toughest places in the world to do business. Lack of electricity has limited access to healthcare, education, and other opportunities, including running their businesses for majority of Nigerians. Many small and medium scale businesses have been crippled due to the prohibitive cost of generating their own power.
We cannot grow our economy without sorting out this critical infrastructure. And all options should be on the table.
