Poor Electricity Supply: Buhari Has To Pursue Aggressive Policy On Gas Supply – Ex-Power Minister Aliyu

Mallam Murtala Aliyu

Mallam Murtala  Aliyu is a former Minister of State for Power and Steel granted this interview to Daily Trust.

The politician from Gombe State, who is also President of the Nigerian Institute of Quantity Surveyors, in this interview, listed steps which President Muhammadu Buhari’s administration must take to achieve a sustainable power generation, transmission and distribution in the country. 

He faulted the immediate past government policy that brought about GENCOS and DISCOS.
See excerpt of interview after the break

Sunday Trust report continues:
Successive administrations in the country have made efforts to achieve sustainable power generation, transmission and distribution yet they didn’t get it right. Where would you say they got it wrong?

We need to first of all understand the concept of power as utility. If we do that we will be getting towards the steps to solving the problems. The general perception of an average Nigerian is that power is one of the dividends of democracy and they should benefit from it after electing a government.  I don’t think so.  I hope Nigerians would also appreciate that electricity power is like the firewood, it is like kerosene, it is like the cooking gas that we need to buy and pay appropriately.  If it is something that we need to buy and pay appropriately for, it means it must be run as a business. All along, previous governments were just curious to award contracts and thinking that by doing that all the problems are solved. Huge contracts have been awarded and huge money have been spent but not addressed in a structural form, in such a manner that it will solve the power situation in the country. There is a role to be played by government, there is a role to be played by investors and there is a role to be played by the consumers.  All these roles are going to be distinct and if one fails others will suffer.

Would you say the unbundling and privatization of the PHCN is justified?

Are we talking of DISCOS or GENCOS?

What is your view on both them?

Alright, let me take them step by step. On the GENCOS, we need to generate enough power supply. Today, we are not generating in terms of what is required in this country. I keep telling people that the city of Jeddah in Saudi Arabia alone consumed 4,000 megawatts. Here, we are in Nigeria still battling with less than 4,000 megawatts. When I was a minister, we aspired to hit the 4,000 megawatts mark and we claimed we did. We need to generate and this has its complications. That is why I said when they generate government should be able to guarantee off takes. If this is done one end of the problem is solved and the supply ends. We need to generate more power, we need to keep expanding the generation capacity and we should give ourselves the timeline. For instance, we may say in the next 10, 15 or 20 years this is where we want to get to. To do that, we must be definite. When I was a minister, I signed an MoU that was to start the process of building up the Mambilla Plateau that would have had the generation capacity of over 4,000 megawatts. We signed the MoU almost 14 years now, but nothing has been done yet on it. We have signed every papers, we did the environmental impact assessment and so on, but up till today nothing has been done on it. If we had started the project 14 years ago, Mambilla would have been supplying this country over 4,000 megawatts by now.  This was to come under an agreement with the Chinese government but I don’t know what happened in between but the project was not implemented. There are other hydro plants like the Zungeru which was started by the past government and there are other ones in other capacities around the country.

The other aspect is gas. Government has to be serious about providing enough gas to generate power. There is not enough gas. People say we have gas in Nigeria but the truth is that there is no gas available. If you have water running in the stream and you cannot filter it for people to consume, it means you don’t have water. So I will say we don’t have gas. There should be a deliberate gas policy to be able to achieve this. It is not providing the gas alone put there should be gas pipelines to run up to the hinterlands to be able to have generating capacities outside the concentration of one location. Security wise, that is risky, secondly, evacuation may become a problem. There must be a clear strategic direction. I think it is there but nobody has followed it. I wish this new government has the political will to carry it on.

The other aspect is the transmission. The transmission capacity is very low. Even if we generate all the power from the GENCOS that we are talking about now we will not be able to get it to the locations that require it. We need to expand the transmission capability and strengthen it. They have done few power sub-stations to improve the quality of transmission but the stations are not strong enough. We still operate the radio system which is weak.  If there is a problem in one location it isolates all substance locations after that point. But in a wave system, you can supply from other ends. So we need to reconfigure our transmission capability and ensure all locations are served. For the distribution, it will require huge investment. Whoever is coming into the distribution must be supported by government. It must be able to attract huge concessions, tax holiday and they should be briefed enough to know that they are not likely to recover their  investments  in the first five years . Not like this one that we are hearing that there is financial disclosure and that investors were briefed enough on it.  I know it is not true because due diligence were not followed or adequately done. People just buy in motion or on opportunity. I was made to understand that people who were close to the past government bought them over thinking it was a lucrative business. It is not going to be lucrative until it becomes huge investment.  If you go to old cities like Ibadan, Zaria or Onitsha, for instance, you may find old transformers that have been running for 20 to 30 years by the grace of God. Nobody tampers with them, nobody repairs them, nobody is checking them they are just there. Now, we are expanding our cities, the urban areas are changing, our designs patterns are changing and our power requirements are also changing. If there is a transformer that has been supplying electricity to these areas 10 years ago that same transformer cannot supply electricity any longer to the areas because the consumption pattern has changed. Now, in the cities, people break plot of land into smaller pieces and there are elaborate houses all over the place, putting pressure on utilities. These are some of the transmission challenges that have not been addressed and we keep spending money thinking we are going to get power.  We will not until we go back to the drawing board and do what is expected.

If you have to advice this government on the possible ways to achieve sustainable power supply in the country, what would tell them to do?

Well, the new government should know they will not be the ones to provide electricity directly; they will need investors at all the tree levels - generation, transmission and distribution. They will need to make the sector attractive for the investors to come in, both locally and offshore. They need to make a huge provision to support or supplement investment in that sector. They can give concessions, tax holidays and so on. There must be funds, whether from the financial sector, international development partners and government itself to be able to support this at a very attractive rate. I remember, in 2001 we were in Guinea to discuss the issue of integrating power supply in West Africa. There were supposed to be the A section and the B section. Nigeria is in the A section. The fear of other West African countries is Nigeria. They were afraid that by the time we connect to it we will collapse it because of our huge demand and indiscipline in the use of power. So they were careful. We can support other countries with higher power supply to generate more than they needed under the existing arrangement and we buy from them. There is excess power supply in South Africa, we can take from them. There is now a power line from Ikeja in Lagos linking us with Benin Republic.  Around Kebbi, there is one that joins us with Niger Republic from Kano, there is another one that joins us with Niger Republic and in Borno another one joins us with Niger Republic.  That will probably enhance our power generation from other countries in terms of generation, transmission and distribution.  
 What happened to the National Integrated Power Project (NIPP)?

On the issue of the National Integrated Power Project (NIPP), part of it was that there were some states that had the capability to generate. It was agreed that they can generate and sell to the National Grid. I remember that Rivers State had a plant, Bayelsa also had one, Akwa Ibom and some other few states also had plants. The oil companies were also given some incentives to convert some quantity of gas from their production to generate power.  Oil companies like AGIP, Shell and others would have done well but the problem is that there were so many leakages in the system. We lose 40 per cent of what we generate to technical fault at transmission, technical fault at distribution and commercial loses. I think what is important is to keep encouraging people who can generate to generate. Government can hold transmission for a while but it must be put to commercial use. For generation, government should hands of it, I think they have sold most of the stations, they shouldn’t build new ones, government should encourage investor to do these things. It should not be seen like job for the boys or opportunity for its supporters but a serious business.

What is your view on the unbundling and privatization of PHCN?

I learnt some of the companies have returned their DISCOS to get back their money. When they sold the companies it wasn’t done in a commercial way, it was more like a favour to those who bought them.