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Privatisation: 3 months after, electricity supply still erratic

The initial shortage in electricity supply after takeover was blamed on unfair allocation of power to the various Discos now manned by new owners. The…

The initial shortage in electricity supply after takeover was blamed on unfair allocation of power to the various Discos now manned by new owners. The Managing Director of the Kano Disco now owned by Sahel Power SPV, Alhaji Jamil Gwamna, decried in December the poor allocation to his area, saying the area was expected to feed the neighbouring Niger Republic from based on an agreement the company had with the Federal Government.
Worse still was the Discos’ delay in actualising their statutory remittance to the Market Operator (MO) for all power consumed by the Discos and their obligatory remittance to the Electricity Regulator.
In protest, the Managing Director of the Benin Disco (Now owned by Vigeo Power), Mrs Funke Osibodu, decried the poor payment of bills by electricity consumers for several reasons including, personally acclaimed billing holiday after privatisation, and non metering which led to poor accountability.
While the situation improved in December with improved supply of electricity to some states, including Abuja, the development was short-lived as the nation was soon plunged into power epilepsy. The Discos, this time, blamed it on poor load allocation from the Generation companies (Gencos).
The Gencos, however, blamed the vandalism of major gas pipeline infrastructure along the Escravos-Western axis and some points at the Eastern pipeline route which abruptly disrupted the supply of gas to the thermal plants and caused firing of the power generating plants to stop.
However, with the repairs of the affected pipelines and the return of improved gas supply in February, consumers say electricity supply is still yet to improve. The situation prompted the Federal Government to issue a directive to the new owners to ensure a significant improvement in supply by June this year.
The Minister of Power, Prof. Chinedu Nebo, who conveyed the presidential directive in January, stated that privatisation was meant to improve services.
“I wish to charge all the principal sector players here today to commit to ensuring that power supply to our customers is significantly and visibly improved by June this year as directed by Mr. President,” Nebo said.
At the second meeting of the investors and the Nigerian Electricity Regulatory Commission (NERC) recently, the Gencos said they are gradually having improved gas supply even as they plan for their stations’ expansion.
Representing the Discos during a press briefing, the Managing Director of Enugu Disco, Robert Dickerman, said the services are improving and they are planning for expansion. Kano Disco, before the meeting in a media report said their allocation has improved by 200 percent, from the previous 50 megawatts (mw) allocation to about 250mw. However, reports from Kano State say the power supply situation has not improved.
The complaints of inadequate supply, continuous estimated billings, none metering and sustained non-improved conditions in the power sector continue to elicit for intervention by the government-owned electricity regulator.
The Nigerian Electricity Regulatory Commission (NERC) has, for the first time, officially warned the 10 electricity Distribution companies (Discos), nationwide, to either improve on their service delivery to consumers or expect some form of regulatory interventions.
The regulator conveyed its position in a letter dated March 11, 2014 with a copy obtained by Daily Trust in Abuja recently. The commission stated that it was time to bring to bear tangible electricity service delivery to consumers within their networks as they had committed to through their business plans before taking over the companies from the government on November 1, 2013.
The letter was signed by Commission’s Chairman, Dr. Sam Amadi and distributed to KANN Consortium for Abuja Disco, Vigeo for Benin, West Power and Gas for Eko, NEDC/KEPCO for Ikeja, Sahelian for Kano, Integrated Energy Distribution and Marketing Company for both Ibadan and Yola Discos, 4Power Consortium for Port Harcourt, Interstate for Enugu and Aura Energy for Jos Distribution Company.
The letter reminded them that three months time was enough for them to go through extant entry challenges in the sector, warning them that constant complaints of poor service delivery from consumers would no longer be taken softly.
Also, a statement from NERC at the weekend, said Dr. Sam Amadi conveyed another presidential directive to the Discos to immediately ensure the metering of electricity.
“He also conveyed a presidential directive on metering of all residential areas, government offices and buildings in a bid to resolve the backlog of outstanding payment,” it said.
However, the commission urged them to improve investments in their distribution networks as they had promised, to surmount the challenge electricity consumers may be facing.
“It has been three months since the handover of electricity utilities to private owners. You took over at a time of great expectation that with the sale of publicly owned generation and distribution assets to private sector operators, there will be discernible improvements in power supply to homes and businesses,” the letter read in part.
NERC, however, said it was aware of some challenges the Discos have faced such as shortage in gas supply to generation companies which has affected the amount of power available for distribution and the burden of debt repayment by the new owners, adding, however, that electricity consumers cannot continue to wait for tangible improvement in the sector.
It also accused the Discos of negligence and non maintenance of key distribution equipment and facility upgrade saying: “Our investigations show that apart from the well known problem of insufficient generation and periodic transmission failures, the failure of supply to these communities is caused more by your failure to invest in routine maintenance and facilities upgrade for the past three months since the handover.”
The letter expressed the commission’s disappointment with the Discos’ nonchalant customer communication strategy, warning that it will not honour any request for tariff review from defaulting Discos.
In response, the Abuja Disco in a statement it issued few days after receiving the NERC letter by its media head, Mrs Patience Toyo, said it is working towards improving electricity services in its coverage area.
The statement said: “In the last three months, we have reinforced and increased the capacity of our network through implementation of deliberate projects; we have upgraded injection substations in Lokoja and Suleja.
“In the next few weeks, we are concluding reinforcement work that will improve power supply in Apo, Karu, Gwagwalada, Kuje, Lugbe and its environs.”
With this inquest and warning bell ringing, it is hoped that the Discos will investing more in their networks while instituting routine checks and maintenance in their service areas. Nigerians need to benefit from what they are paying for.
 As the Minister of Power, Prof. Chinedu Nebo, has noted recently, government will no longer tolerate any excuse of non-performance from any of the sector players.
Nebo warned: “Nigerians must, I repeat, must, enjoy the dividends of the reform programme and none will be allowed to frustrate this vision of Mr. President.”