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Power Supply: Still No Respite Even After Privatisation

BARELY three months after the Federal Government handed over 11 power distribution and five generation companies, created out of PHCN, to their private owners, the power supply situation in the country has worsened and there appears to be no remedy in sight.

Vice President, Alhaji Namadi Sambo, who is Chairman of National Council on Privatisation (NCP), had during the handover ceremony, which took place simultaneously at the headquarters of the successor companies (SCs) across the country, assured Nigerians that the privatisation of the country’s power sector would lead to greater efficiency and improved power supply nationwide.

  Speaking through the Permanent Secretary, Federal Ministry of Finance, Mrs. Anasthasia Nwaobia, who represented him in Ibadan at the handing over of Ibadan Electricity Distribution Company (IEDC) to the new owners, the Integrated Energy Distribution Company and Marketing, the Vice President said: “It needs to be re-stated that the electricity power reform programme became imperative in order to improve efficiency, reduce losses and cost. No doubt, this reform will lead to increased access to electricity, engender private sector investment, improve infrastructure, and create employment for the growing population,” he said.

  In deed, there were high hopes across the country following the successful completion of the power sector privatisation process. Mr. Tunde Oladeji, a teacher had told the News Agency of Nigeria (NAN) that he hoped that “electricity supply will improve’’.

  Oladeji said he initially doubted the successful conclusion of the privatisation of the energy sector based on past experience.

“But the realisation that privatising PHCN may result in customers paying for the exact power consumed is inspiring,” he said.

  Mr. Bisi Johnny of Idi-Seke, Osogbo, also told NAN that he was looking forward to a new power sector that would be truly responsible to the people.

  Johnny said that it was important for the new owners of the companies to fashion out ways of improving on power generation.

  Also, Mrs. Folabomi Ibiwoye, a housewife, had advised the new investors to endeavour to win the confidence of the people through stable power supply and accurate billing.

  “A situation whereby we pay for what we did not consume is very bad,” Ibiwoye said.

  Exactly 86 days after Nigerians expressed their expectations and fears as the private sector took the driving seat in the country’s power sector, findings show that the performances of the new owners are far below the yearnings of the citizens. The Guardian investigations in some parts of Lagos State showed that residents now enjoy less hours of electricity supply since November 1, 2013, the date the private investors took over. The development has left Lagosians, nay Nigerians with no choice than to feel that the power sector privatisation exercise is a ‘ from frying pan to fire experience’ even if it is in the temporary.   

  Mr. Matthew Ugwu, who runs a restaurant in Bale Street in Ilasamaja area of the state, told The Guardian that power supply in the area has been so poor that businesses that depend on electricity to function are really facing a hard time.

  “Now, we don’t know when to expect power supply and when not to. Since the new investors took over, power supply in this area has really been epileptic. The highest we have enjoyed electricity in this area for over six weeks now is between five minutes and 20 minutes maximum; and you don’t even know when to expect it. What can someone achieve with that kind of supply?” he asked.

  Explaining how the development affects his business, he added: “It seriously affects my business because I spend a huge sum every month on fuel and servicing of my generator. However, the most annoying thing is that these people still come with their bill every month; it is a clear case of extortion because I’m paying for what I did not consume.”

  Residents of Ago Palace, a community in Okota area of Lagos also expressed dismay at the power supply situation in the area.

  “It used to be bad in the past but the situation now is killing,” said Mr. John Okechukwu a resident of Lateef Aregbe Street, Ago, Okota.

  Okechukwu said: “Before the so called privatisation and subsequent take over of the power sector by some private companies, PHCN used to ration supply for us in this area. Before November 1, 2013, our schedule for power supply was two-day on/one-day off and they were 80 per cent efficient. Any day they failed to keep to the schedule, we just knew that something had happened. These days, the situation is such that we hardly have supply.”

  He added: “Since Sunday January 5, this year, we have not had power supply for up to 20 hours on the whole; they have their data and can either validate or fault my claim. But I’m sure of what I’m saying. It was total blackout until last Saturday (January 18) when they restored supply and left it for few hours. After that, all we see is between five minutes to 15 minutes of supply. The situation has left most families in this area running on generator with attendant economic and health impacts. It is really an unbearable situation because they still come with their bill.

  “What is happening now is enough reason for government to insist on the issuance of pre-paid metres. Like the defunct PHCN, these people are already taking advantage of Nigerians by making us to pay for what we did not consume. It is only a country like Nigeria that can condone that.”

  Both Ilasamaja and Ago Palace are being fed by Ikeja Electricity Distribution Company, which was bought by NEDC/KEPCO Consortium.

  A civil servant, who lives in the Ketu area of the state, also stated power supply in the area has been erratic. Ikeja Electricity Distribution Company also feeds the area.

  The civil servant, who was particular about crazy billing, but does not want his name in print, narrated his experiences thus: “For the months of October and November alone, the company estimated my bills to be N24, 000. Immediately, I wrote the Business Manager the following letter which was acknowledged by his office: ‘I write to draw your attention to a deliberate and mischievous overbilling of my flat at the above address to the tune of N24, 192.89 for the months of October and November. Although I have a metre, I wonder why your office decides to estimate my bill at alarming rate. Henceforth, I want the estimated bill stopped and the errors in the billings in the two previous months (October and November) corrected as soon as possible.

  It is noteworthy that after paying N2, 000 from the remaining debt of N29, 000 your predecessor, PHCN, forced on me, I am supposed to be left with a debt of N27, 000 in October. But your firm decided to increase that debt by over N7, 000 when it gave me N34, 420.27 as net arrears for October and estimated my bill for the same month as N9, 802,12, thereby escalating my bill for the month of October alone with about N16, 000. Is that fair?

  “The month of November is not any better as your firm also gave me N8, 981.00 as estimated bill, even though majority of the time, my family and I do not stay at home to use electricity supply, even when there is erratic supply. I am yet to figure out why my colleagues who live in similar flats in my neighbourhood would be charged about N2, 000 per month while I am being charged almost N10, 000 per month.’”

  He stated that his total outstanding bill as at December stood at over N67, 000.

  Although many have argued that the new owners would need ample time to be able to satisfy consumers, the Minister of Power, Prof. Chinedu Nebo, traced the shortage of electricity supply to some parts of the country to gas supply challenges, an excuse that the defunct PHCN always gave when it fails to perform.

  He assured that the challenges were “being squarely addressed by the Federal Government,” explaining further that the deterioration in the quantity of supply in Lagos was a direct consequence of the compounded gas shortage resulting from the recent extensive vandalism of the Escravos Lagos (Western axis) gas pipeline.

  Corroborating his view, the Nigerian National Petroleum Corporation (NNPC) in a statement on Wednesday, January 22, titled ‘Status of Gas Supply to the Power Sector’ noted that the gas sector had been faced with a major challenge in pipeline vandalism, which has significantly eroded available gas supply to the power plants.

  NNPC said: “The consequence of this is the current situation of sub-optimal supply of electricity to Nigerians. As at the last weekend, over 30 per cent (480MMsf/d) of the installed gas supply capacity was out due to vandalism. This is equivalent to the gas requirement to generate about 1, 600MW of electricity.

  “The pipelines involved are the Escravos-Warri segment of the ALPS A pipeline (190mmcf/d) and the Trans-Forcados crude pipeline (230mmcf/d). The remaining supply shortfall is due to faulty glycol pump at Utorogu gas plant (60mmcf/d).

  “The outage of the ELPS A pipeline has been on for over six months due to a willful act of vandalism at various locations between Escravos and Egwa location. Specifically, on June 25, 2013, an explosion rocked the pipeline.”

  NNPC stressed that the cumulative effect of the interruptions is a real drop in gas supply to plants assuring that “the Ministry of Petroleum Resources and NNPC will continue to make effort to assure gas supply in a difficult environment. It is expected that a major improvement in power supply should be achieved within two to four weeks as the various repairs are completed.”

  The import is that Nigerians should not expect improved supply until about one month from now. And that is only possible if the corporation is able to complete the repairs as scheduled as it could take more time. And should there be further vandalism of gas pipelines to the power plants, further blackout awaits Nigerians, so be prepared. Even NNPC warned in the statement that “as you are aware, there is heightened effort by the Federal Government to address the challenge of pipeline vandalism and crude oil theft. We believe these efforts are yielding results gradually, nonetheless, for as long as some crude theft persists, the gas supply situation remains vulnerable.