energy

Truth be told, while the adequate power supply is the sine qua non to industrial development, Nigeria, since its founding, has never enjoyed that service by half her demand, one that is taken for granted even in many developing climes. And the optics don’t seem to be in that direction. No, not in the near future, judging from antecedents.

And while it is acknowledged as the way forward to ensure product competitiveness as a springboard to development, successive governments have either treated the issue of power supply with kits gloves or are clueless about the way forward.

The point is arguable considering the fact that tens of billions of dollars have been sunk into the power sector over the past two decades with virtually only an average addition of two megawatts of electricity distributed to Nigerian households and businesses.

Also, considering the fact that Nigeria’s population has increased by tens of millions since 1999 explains why the increased distribution of two megawatts does not reflect significantly on the average consumption of power by individual Nigerians and businesses.

The country’s 1996 energy policy covers the development, exploitation, and Supply of all the nation’s energy resources. It also covers key energy utilization sectors; energy-related issues such as environment, energy efficiency, energy financing, and energy policy implementation. It includes strategies for systematic exploitation of the energy resources, the development and effective use of energy manpower, supply of rural energy needs, efficient energy technology development and use, energy security, energy financing, and private sector participation. The strategies are finally harmonized and grouped into short-medium – and long–term measures for easier implementation.

Among the objectives of the country’s 1996 electricity policy was to continue to engage intensively in the development of electric power with a view to making reliable electricity available to 75% of the population by the year 2020.

It is obvious today that perennial policy somersaults have impeded the implementation of Nigeria’s electricity policy. And the trend dates back at least a century.

During Nigeria’s colonial era, commercial electricity was generated mainly from coal-fired plants. Coal utilization was predominant between 1928 and 1939. The coal industry suffered a blow in the 1950s when oil was discovered. It wasn’t as a result of lack of coal, nor was it poor power delivery. It was merely a lack of focus.

The country subsequently switched to hydropower and steam plants. Then, the installed capacity for electricity generation increased by a factor of 6 over the period 1968 to 1991 and by 1991, stood at 5881.6 MW. No further addition to generating capacity was experienced over the subsequent decade.

It is worthy of note that the total technically exploitable large-scale hydropower potential of the country is estimated at over 10,000 MW, capable of producing 36,000 GWh of electricity annually. Only about one-fifth of this potential had been developed as of 2001. The small-scale hydropower potential is estimated at 734 MW.

Over those years, the availability varied from about 27% to 60% of installed capacity, while transmission and distribution losses accounted for about 28% of electricity generated.

In December 2001, the available generating capacity was raised to 4000 MW, but this soon dropped to 2,600 MW within the first quarter of 2002.

Meanwhile, the annual consumption of electricity had been increasing very rapidly over the previous three decades. It increased from 1,273 GWh in 1970 to 13,700 GWh in 2001. This represented a suppressed demand caused by inaccessibility to the national grid and inadequacies of the electricity supply. One consequence of this is that various industries and other consumers have installed generators whose total capacity was estimated to be at least 50% of the installed capacity of the national grid.

By the end of the century, the domestic sector accounted for over 50% of the grid electricity consumed in the country while the commercial and industrial sectors accounted for about 25% each.

Then in the first four years of the new republic, spurred on by the successful construction and use of gas turbines in Akwa Ibom State, President Olusegun Obasanjo made substantial investments in gas turbines. But investment in gas turbines has come with its own set of problems, notably gas supply.

Nigeria is currently producing less than 4,500 megawatts (MW) of electricity for its teeming population owing to limitations from low gas supply to power plants. For over 209 million people, 4,500MW of electricity supply out of over 13,000MW generation capacity implies erratic power supply and lack of energy access in most parts of the country.

As of the time of writing this piece, some of the affected thermal power stations were Sapele NIPP, Olorunsogo NIPP, Ihovbor NIPP, and Azura Edo, Egbin, Sapele, Delta, Geregu, Omotosho, Olorunsogo, Geregu NIPP, Alaoji NIPP, Omotosho NIPP, Odukpani NIPP, Okpai and Omoku power generating plants. Recently, four of them generated zero megawatts.

Out of the 28 electricity generation companies (GenCos), only three are hydro — Shiroro, Kainji, and Jebba — while others are gas-fired plants. Hence, they need a constant supply of gas to produce electricity.

Gas continues to dominate the electricity generation mix accounting for 81.53% of the electricity generated during the second quarter of 2020. This implies that approximately 8.15kWh of every 10kWh of electric energy generated in Nigeria in the second quarter of 2020 came from gas,” a NERC report stated.

Nigeria holds the largest natural gas reserves in Africa — and the ninth-largest globally — with an estimate of 200.79 trillion cubic feet (Tcf), yet only a little is tapped. The reserve is estimated to rise to 210.8 tcf by 2022. That clearly smacks of poor policy implementation.

To surmount some of the underlying problems with power distribution, last year, outlining the plan of President Muhammadu Buhari to divert from old strategy and delivery of electricity to homes and industries, senior special assistant to President Buhari on Public Affairs, Ajuri Ngelale announced a deal between the Nigerian and German governments to fix the transmission and distribution problems in the industry. He boasted that it was a government to government affair, where the German Export Credit Agency would provide 80% of the funds needed to fix the transmission and distribution bottlenecks bedeviling the power sector in Nigeria and the federal government would pay 20% of counterpart fund to the bank, with Siemens being the sole contractor. Ngelale said there would be no local subcontractors or middlemen.

He cited that in the past, efforts to generate and distribute power was essential to pull out a whole lot of money and essentially domicile in a federal agency account and leave it in the hands of the chief executive officer of that ministry or agency to dole out the huge amount to whoever he would like and many of the contracts were not executed. He cited a particular contract in which a contractor was given $2 billion to execute a contract, and not up to 50 percent of the contract was executed.

He explicitly said the Nigerian government had already set aside 20 percent in the 2020 budget. That means the federal government would send N61 billion directly to that German bank, and directly from Nigeria’s federation account. The German Export Credit Agency would pay that money directly to Siemens.

Accordingly, Siemens would collect the amount from the German Bank and manufacture all the equipment that was required to be distributed in Nigeria; the federal government’s part of the deal would be only to monitor.

When Ngelale made that revelation last March, he said Nigerians would be guaranteed 7,000 megawatts by December 2021, and 11,000 by 2023. Barely five months to December 2021, an authority who is close to that deal revealed to the Alvin Report that the deal is a forgotten issue. Today, power distribution is lower than it was this time last year.

As if a failure to focus on delivering gas to reach the installed capacity of 13,000 megawatts, the government recently announced its intention to invest in the coal industry with the goal of generating 11,000 megawatts by 2034.

Ashaka, one of the coal plants, would come on stream by 2034, and is expected to add 64MW to the national grid.

Other coal plants- Ramos expected in 2034 will add 1000MW, Ashaka/TPGL in 2034 will add 500MW, Nasarawa Coal Power, in 2034 will add 500MW, Benue Coal Power, expected in 2037 will add 1200MW, while Enugu Coal Power to come on stream by 2037 will add 2000MW to the grid.

Coal-fired power stations are said to generate over a third of the world’s electricity and coal plants are still being built in Asia, almost all funded by China.

So, although coal plants are generally considered dirty fuel and harmful to the environment, it is still a viable means of power generation, especially since Nigeria has coal in abundance. But the issue of concern is why not perfect the gas option since Nigeria has an abundance of gas reserves, and has already invested heavily in gas turbines?

Did the policymakers not consider the means of supplying gas to the plants to run the turbines before constructing them?

While it is true that Nigeria’s electricity policy provides that the country explores all available energy sources to generate and distribute electricity to Nigerians, the back and forth cum unstable investment in the power sector leaves many Nigerians in wonderment: Will Nigeria Ever Have Adequate Power Supply?