Curious plan to cripple DISCOs?
Although the electricity workers have called off their industrial action barely 24-hours after it was declared and the country was plunged into total darkness, not many Nigerians felt the impact, as people are used to regular power outage. People get surprised if there is uninterrupted electricity supply for a while. They will then question what may be responsible for the unusual stability.
The electricity sub-sector has been bastardised and from the look of things, respite is not in sight any time soon. There is need for a complete overhaul of the entire power structure. What is on ground at the moment is grossly defective. Mere ad-hoc interventions won’t solve the huge challenge.
The crisis rocking the power sector had degenerated even before the electricity workers decided to shut down power supply nationwide in their latest strike. Both economic and social services were crippled. The intractable epileptic power supply coupled with outrageous estimated bills being sent to suffering consumers remains a headache. How to redeem the power sector remains a big headache to the Federal Government.
Perhaps, it was on this background that the Federal Ministry of Power, the other day, rolled out what it called “Willing Seller, Willing Buyer” policy, under which electricity would be wheeled directly from the Generating Companies, GENCOs, to willing consumers who are ready to fully settle bills.
This arrangement effectively cuts off the electricity Distribution Companies, DISCOs, from their main line of business as middlemen between the GENCOs and the consumers. The willing consumers, according to the policy, may include community and commercial clusters, industrial areas and hospitality sectors.
According to the Minister of Power, Engr. Sale Mamman, the policy was designed to save energy losses in the Power sector and support GENCOs who have not been getting the full payment for their generated power.He said the DISCOs have not been distributing all the power wheeled to them on the ground that the consumers were unable to pay for the power, which has necessitated the huge Federal Government’s subsidy intervention by paying the GENCOs for undistributed power.
Noting that over 2,000 megawatts (MW) of electricity was not being distributed due to the failure of the distribution chain, the Minister explained that the huge subsidy was an overbearing burden on the government.Furthermore, the Minister disclosed that the DISCOs owed the GENCOs and other agencies in the power sector over N1.3 trillion and that their collection and remittances have remained below 30 per cent or even far less despite several efforts to make them improve.
Mamman expressed the hope of an anticipated improvement in power supply to the country, which he said would be followed with an inevitable increase in electricity tariffs.No doubt, the increase in electricity tariff might be the interest of government rather than improvement in power supply. Nigerians have often been slammed with unjustified payment of exorbitant electricity tariffs for power not supplied.
Apart from removing the DISCOs from the power supply chain, which could ignite serious contentions, what other concrete measures are there to get the power sector out of the woods? There is no such disclosure from the Minister at this stage.At this juncture, we must reiterate that relying on the electricity generated by the GENCOs alone is like putting all our eggs in one basket. That is strategically unwise. Diversification of power supply sources would reduce the over dependence on gas.
There can be no assurance of steady gas supply at all times given the uncertainty in the Niger Delta region, which is the source of the gas.
Nigerians would like to see a new drive towards generating power from coal and solar energy sources. The country is richly endowed with these energy sources. All that is required is to formulate an effective framework for the utilisation of alternative energy as this newspaper has consistently suggested.On that ground, the quest for coal power licenses by investors should be considered. The same applies to those wanting to build solar power plants. A strategic energy mix will save the country the embarrassment caused by low energy output.
The nation should be tired of different models that do not consider sustainability in this sector. Meanwhile, what is the level of regulation that will enable the owners of GENCOS and DISCOs to invest robustly in the sector? There should be decentralisation of the sector as we have different geo-political zones that cannot continue to depend on the decrepit national grid. The extent laws should be amended to accommodate peculiarities that have held the sector down.
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