“Sometimes people don’t understand the promises they’re making when they make them.” ― John Green
The Federal Government promised to generate, transmit and distribute at least 20,000 Megawatts (MW) of electricity within four years and increase it to 50,000 MW with a view to achieving uninterrupted power supply within 10 years. This was part of their campaign manifesto as they sought to take over the reins of government in the last polls. This power generation proposal is a laudable initiative but then it is just a campaign promise. Nigeria currently generates less than 5,000MW which is far too small for a population of over 160 million people. Lagos state alone based on her population requires at least 5,000MW to satisfy her power needs. Generating 20,000MW over a period of four years will adequately solve our energy needs in no distant time. However, Nigerians are used to hearing this campaign ‘one –liners’! It already appears such a promise has been reneged upon as there are no indicators of it in the offing.
It is still early days in the new administration so it will be absurd for anyone to fault the government of the day on the power debacle. However, looking at this holistically, the feasibility of generating ‘20000MW in four years’ is doubtful. The reasons are simple. The budgetary allocation of the Works, Power and Housing ministry in the 2016 budget is way below satisfactory! The long term power generation plan as promised was not captured in the budgetary provisions. Proponents of the Government may argue that we have a dwindling source of revenue. As true as this is, we need to channel more of the limited funds in our kitty to power generation. As it stands, our economic breakthrough is largely dependent on diversification of the economy. The non-oil sector cannot thrive without adequate power supply. Transportation, manufacturing and production of agricultural produce require power to make this sector economically profiting. Moribund companies like the Ajaokuta steel company won’t be in business as long it remains cheaper to import steel products than to manufacture steel products–considering the operating costs.
The main reason we cannot produce the energy we need is our overdependence on oil products. The demand for electricity far outweighs supply. We have no reason to be short in power availability –solar energy, biomass and wind energy can be harnessed as these resources are readily available. Unfortunately, we do not have the technology and equipment to convert this energy into useful power.
Nigeria is been colonised by darkness. The average citizen generates his or her own power to meet his or her energy needs. Providing ₦433.4 billion for three critical areas of the economy to share whereas some other sectors got close to a quarter of these doesn’t make economic sense. The National Assembly got more budgetary allocation than a critical non –oil sector, Mines and steel yet we expect what is virtually non-existent to fund our future needs? Jack Gerrard, the president and CEO of American Petroleum Institute closely linked a nation’s prosperity with its Energy Production. He reckoned that at a time when economic recovery still hangs in the balance, the need for an energy policy that recognizes energy production from renewable and non-renewable sources holds the key to ushering in a new era of prosperity. Though he was referring to the American Energy market, this submission is also true of the Nigerian energy market. Our economy is not healthy at the moment and we need to take drastic steps to implement existing energy policies to keep us afloat.
Depending on the technology, generating 1 KW of electricity will cost between $800 and $2000.In essence, it will require an investment of $16 billion to $40 billion to meet the 20000MW target. Unfortunately, the government of former president Olusegun Obasanjo invested close to $16 billion in the power sector with nothing concrete to show for it except poorly sited Independent power projects! The current government will need to invest at least $7 billion yearly to meet their target of 20,000MW in four years. This alone is more than the budget of the Works, Power and Housing ministry! Did the current government just say that they will generate 20,000MW in four years for the fun of it without analysing the facts on ground? Or perhaps as part of political gerrymandering? Our main source of revenue has dwindled recently with future oil prices projections not encouraging. Looking closely at the 2016 budget, aside other revenue sources, non-oil revenue is projected to generate ₦1.45 trillion. How is this feasible without a capital investment in the power sector? One does not need to be savvy in Energy matters to know that solving our power debacle will transform that sector. Modern day agriculture requires power for improved cultivation, processing and supply chain management. This is no rocket science. As long as banks, companies and industries continue to generate their own electricity, the masses will continue to bear the brunt of it – More hardship! Telecommunication companies in Nigeria generate their own power for their base stations. A typical base station has two generators working interchangeably. They operate non-stop with diesel and they have approximately 20,000 of such base stations in the country. Imagine the power been generated by these stations cumulatively! And as expected, the cost of these is passed on to the citizenry. Yet the Federal Government in partnership with the Nigerian Electricity Regulatory Committee (NERC) thought it ‘wise’ to approve a new electricity tariff starting from February 2016(That is if the members of National Assembly don’t intervene) . Whether it is a business decision or a political one is yet to be fully understood. Most of the private investors in the power sector say they need to bridge the gap between the operating costs and Electricity tariffs and keep to the terms of agreement they signed previously. Will an increment in Electricity tariffs improve power supply now? One thing is certain. Our Energy poverty level is at its peak. Increasing electricity tariff is not only insensitive at the moment but further piles on more suffering on the populace.
The Federal Government needs to review or supplement the budgetary allocation for the Power, Works and Housing ministry with a view achieving its campaign promise. Our main stay of revenue has nose-dived greatly. We cannot afford to spend as we did during the heydays of high oil prices. However, to keep afloat in these turbulent economic times, we need to channel more of our resources to the right sectors. In 2010, at the Joint Lagos State Executive Council and Permanent Secretaries Retreat which held at the Golden Tulip Hotel, Lagos, The current minister in charge of the ministry of Power, Works and housing then Governor of Lagos state ,Mr Babatunde Fashola, had charged the then Federal Government to provide a road map for the power sector. He demanded transparency in the dealing of the then Federal government in the power sector and chided them to more proactive. As fate will have it, He has now been saddled with the task of implementing his own recommendations. The government of Dr. Goodluck Jonathan succeeded in getting a comprehensive roadmap for the power sector. The 82 –page document covered sound policies that that will free Nigerians from the shackles of darkness in the long run provided the recommendations are well implemented.
The 13-point agenda unfolded by the minister of Power, Works and housing is basically not different in principle from the revised road map for the power sector. Ordinarily, it would have been expected that the road map would have been further revised and not jettisoned totally. The 13-point agenda is very much achievable. However, uninterrupted power supply cannot be achieved at the moment even if all the generated power of approximately 6,000MW is effectively distributed. It is expected that we take necessary steps to improve our generating capacity if we are to ever achieve uninterrupted power supply in Nigeria.
Written by Samuel Onimpa Alfred, a Mechanical Engineer based in the UK with special interest in the World energy market.