Proposed bill on generator ban: Will there be light at the end of the tunnel?
“We will make electricity so cheap only the rich will burn candles” – Thomas Edison, 1879
Almost 140 years after the above remarks from Thomas Alva Edison was delivered, his dream has become a reality in most parts of the world – but not all of it. Nigeria is one of the countries where electricity is not cheap, and the rich do not burn candles – they burn liquified natural gas and crude oil. In order to provide electricity for almost 200 million people, the federal government has spent billions of dollars, and it is still spending by the grace of God, on power project in Nigeria. Unfortunately, the power supply situation in the country has not improved. What a pity?
Data released by the International Energy Agency (IEA) towards the end of 2018, show that the number of people worldwide without electricity has fallen below one billion for the first time in modern history. Most of the improvements, according to The Economist edition of 20 November 2018, comes from India where 400 million people have gained access to electricity since the year 2000.
Although, some 22 million household are still in the dark in India, according to an NGO, “investment in India has so far focused on large-scale, grid – connected wind and solar projects.” The report further shows that the country will need to incorporate off-grid methods as well, which currently makes up only 2 percent of investment, if it is to achieve its goal of universal 24- hour electricity by 2022. In the case of China, the country is reported to have taken up to 20 years to provide electricity to the remaining 10 percent of its population without power.
In Nigeria, consumption rate has been more than electricity generating capacity in the country for more than four decades. This resulted in the privatisation of the power sector to improve its efficiency. With privatisation, the Power Holding Company of Nigeria (PHCN) ceased to exist, and Nigerian Electricity Regulatory Commission (NERC) was born.
The privatisation of the country’s power sector with all intent and purpose is to enable enough electricity supply for Africa’s largest economy. But privatisation of the power sector has not helped matters. Why? The country has lost more Mega Watts (MW) in the post privatisation era due to corruption, vandalization of gas pipelines and other acts of restiveness in resource-bearing communities among other social challenges. Today, Nigeria’s power sector remains in shambles because 3000MW is what is technically available to consumers of electricity. But this is too small to cater to the electricity demands of a country of about 200 million people aspiring to industrialise.
Consequently, power failure has been a fact of life in Nigeria as most households, companies and government offices now operate their own electric generating plants with attendant implications for costs and disruption of production. This terrible situation in a country with abundant gas and oil reserves is tragic.
The latest news trending is that the Senate of the National Assembly (NASS) through a bill is proposing 10 years jail term for generator importers and sellers in Nigeria. The proposed bill has passed the first reading in the Senate. Is the proposed bill being pushed because of frailty of institutional memory? The lawmakers in the Red Chamber of the NASS must be reminded that one of the reasons why privatisation of the power sector fails to deliver is attributed to acts of sabotage and corruption by some “powerful people” benefitting from the importation and use of generators.
Privatisation of the power sector has not helped matters. Why? The country has lost more Mega Watts (MW) in the post privatisation era due to corruption, vandalization of gas pipelines and other acts of restiveness in resource-bearing communities among other social challenges
If the proposed bill sailed through the NASS, it would certainly open a can of worms in the power sector. This is because as those in authority are trying to solve some of the problems of epileptic power supply, the proposal to ban the importation and use of generators will complicate issues and create more troubles. On the positive side, fuel consumption will go down and there will be reduction in noise pollution. There will be savings in forex. But almost all manufacturing companies may close shop. The public and private sectors will be affected negatively. Unemployment figures will rise astronomically etcetera. It is good to have a clean environment that is void of any form of pollution and its effect. The ban of generator in the country without first, instilling the culture of good governance and provision of alternative sources of energy will further exacerbate instability and uncertainty in Nigeria’s power sector.
Despite privatisation, the federal government (FG), has reportedly spent trillions of Naira on the power sector and it is still contemplating borrowing billions of dollars in addition. Experts have expressed their disappointment over the situation in the country’s power sector. If one peeps at the faulty sale of distribution companies (Discos), the FG bailout, huge debts that have affected the financial outlook of a few banks, and weekly political statements that has created confusion in the power sector, you are tempted to ask: Will there be power at the end of the tunnel?
There are so many activities happening concurrently in the power sector. There is a committee chaired by the Kaduna State Governor, Nasir El-Rufai, to review government’s 40 percent stake in the in the Discos amid speculation on cancellation of licenses or sale of the same Discos to Siemens. There are accusations and counteraccusations between the government and Discos. For instance, there are reports that the Minister of Power, Saleh Mamman, expressed regret that even when the Discos receive 3000 MW, they short-change the system by paying for only 1000 MW, adding that the FG could no longer continue to subsidize their inefficiency.
Before signing the proposed bill into law, one would have expected those in government to tap into every available opportunity to increase power generation by encouraging the siting of power generation plants by private individuals and firms. In the short term, there should be a strong regulatory intervention from NERC that will make Discos to step up their performance. If Discos are unable to improve their performance, they should please, step aside. The entire arrangement should be decentralized with mini grids at local, state and federal levels.
If there was going to be light at the end of the tunnel, off- grid is the way to go. Off-grid electricity would generate a reasonable quantum of electricity for Nigeria. The FG must, therefore, allow as many companies as possible come into the electricity generation net in Nigeria. If not, the country will be oscillating from darkness to darkness for many more years to come.
Advanced countries provide electricity which would meet their social and economic needs because they do not neglect opportunities for generation. If the legislative and executive arms of government place a ban on the importation and use of generators, it will not automatically make electricity available in the country. Those in authority should remember that no single factor is responsible for underdevelopment, and no single policy or strategy can set in motion the complex process of economic development. Thank you!