Chukwueloka Umeh, chief executive officer, Century Power Generating (CPG) Limited, has canvassed for complete deregulation of power, saying the epileptic power supply witnessed in the country could become a thing of the past if government allowed market forces to determine pricing in the entire value chain from generation of power to distribution.
Umeh said the entire value chain is presently dysfunctional and broken in an interview with journalists in Lagos, noting that the major issue with the power sector is that government has continued to regulate tariffs and the price of gas.
This he says will continue to discourage investments in the power sector.
“Rather than allow market forces to determine the price for gas, government continues to regulate the price, which in itself discourages any form of investment,” he said.
He said the same applies to the distribution companies, which he said are unable to attract funding because the present fixed tariffs cannot guaranty adequate return on investment. Consequently, he called on the Federal Government to replicate the deregulation model that was adopted in the telecom sector, which resulted in the creation of hundreds of thousands of direct and indirect jobs as well as boosting economic growth.
“How can you pay your loans when there are many things like metering still unsolved? A lot of the networks are not properly metered; a lot of the networks have lines and transformers that are so old. You also have a lot of networks where people are stealing power from them,” he said.
“So if you’re collecting money for only 30 percent of the power you’re given, how can you pay for the part that you’re supplying? So at the end of each month, you cannot pay the generating company that supplied power to the grid for you to take the power. Now because you cannot pay them, the generating companies also cannot pay the transmission companies. It’s a vicious cycle of failure.’’
Temitayo Ayetoto
