The troubled power sector in Nigeria may further sink into stormy waters in coming weeks with attendant blackouts if N1.2trillion is not urgently provided for both generation and distribution companies in the supply chain by the federal government.
Consequently, the Senate Monday , called on the federal government to declare a state of emergency in the sector as it described the 2013 privatisation fraudulent.
Painting the gloomy picture of the sector in her key note address at a one day roundtable discussion organised by the Senate at the Nigerian Air Force Conference Centre Abuja , Country Representative of Energy Market and Rate Consultants, Mrs Rahila Thomas said for survival alone , government needs to urgently inject N1.23trillion into it.
According to her , the Sector is bedeviled with myriad of problems which had put investors into huge debts and broken down trust in the entire value chain .
“Issues bedevilling the power industry in Nigeria started with fatal flaws inherent in the 2013 privatisation anchored on wrong assumptions inhibiting investors from taking care of their loses let alone , delivering on the required electricity supply in the country.
“The fatal flaws or wrong assumptions upon which the privatisation was carried out in 2013 has to do with generation capacity government put at 6,500 megawatts but later turned out to be 3,453megawatts , assumptions in the loss for every Naira of kilowatts put at 21kobo but later turned out to be 52kobo loss per every Naira of kilowatts with attendant unanticipated loses totalling far above a trillion Naira now,” she said.
She lamented further that unbearable loss in the sector by investors arose from subsidies promised on yearly basis by government on the 21kobo loss per one naira kilowatts which later increased to 52kobo loss per naira kilowatts without required subsidy payments by government.
“Even the N600billion reported to have been put on the table for the sector this year , has not been accessed by investors 21 days to the end of the year.
“Another factor is that of Forex because exchange rate of a Naira to a US dollar as at November 2013 when the sector was privatised was N157 but now between N350 to N360.
“Liquidity is the key problem in the sector due to unattractive investments in the Industry,” she said.
She however said that the country has the capacity to improve the generation capacity from the 4,000 megawatts it is now to the projected 7,000, 11,000 and 25,000 megawatts in years to come if the prevailing challenges are adequately addressed.
But the President of the Senate , Ahmad Lawan , in his remarks while declaring the roundtable discussion open, said the privatisation was a fraud which according to him, is ruining the Nation’s economy.
“No single sector is so important and yet challenged like the Power sector which going by problems bedevilling it , requires a declaration of emergency .
“We all know what is wrong , what we really need to do is to have the political will to take on the challenges.
“Electricity power reforms of 2005 to the total privatisation in 2013 are more or less fraud based on realities on the ground.
“Power failure in the country has reduced Nigeria from a country that was competing and comparing herself with other countries like Malaysia, Singapore, Brazil etc in the 60s to a country now comparing herself with Ghana, Togo, Republic of Benin etc.
“The matter is even worst to the point that even citizens who have capital to invest , no longer do so in Nigeria but relocate to Ghana where there is constant electricity supply.
“The ugly trend must be stopped and that is the reason why the Senate is organising this round table discussion where measurable roadmaps will be set in positively turning things around for Nigeria and Nigerians,” he said.
Other stakeholders at the session like the Minister of Power, Engr Saleh Mamman, the Minister of State for Piwer, Prince Goddy Jeddy Agba, the Senate leader, Yahaya Abdullahi and Chairman, Senate Committee on Power, Gabriel Suswam , expressed optimism in their submissions that the round table discussion will proffer solutions to the problems bedevilling the sector .
