FG moves to curb Nigerians’ power woes

A Federal Government memo seen by BusinessDay has revealed the actions needed to forestall a repeat of the events that led to a crash in available electricity generation last month following the collapse of the national grid.

It showed that about 2,800 megawatts (MW) of electricity was lost in March on the back of several challenges that faced the country’s biggest power plant and six others.

On Wednesday morning, a traffic snarl from the Independence tunnel in Maryland backed up 6 kilometres to Ketu, in the heart of the Lagos metropolis. The cause was an electrical spark from a pole that led to a mass of burning cables falling on the expressway.

Around the country, Nigeria’s power infrastructure is wilting under the weight of neglect, underinvestment and sabotage. This is the major theme of the memo.

Since the beginning of 2022, Nigeria has lost more than 3,000MW of power from a combination of several factors including gas pipeline sabotage, poor maintenance of gas pipelines and turbines and lower water levels at hydropower plants due to the dry season.

This comes at a time when the government is implementing reforms to ensure a fairer cost for power is paid by consumers under the service-based tariff, which took off in November 2020.

The memo indicates that Nigeria’s power generation lost 2,790MW in March alone.

There are 24 operational power plants in the country and more often than not, nine of these account for about 80 percent of generation.

Due to its size and availability, Egbin power plant often accounts for the largest share (18 percent) of the total energy output followed by Okpai and Azura power plants, which account for 9.37 percent and 9.14 percent energy share respectively.

The implication is that the (over) reliance of the grid on the energy supplied by nine power plants may pose a risk to network stability in the event of sudden loss of any of them unless adequate proactive measures such as spinning reserves are put in place, the Nigerian Electricity Regulatory Commission said in its second quarter report for 2021.

This was the reality in March when Okpai and Egbin along with other power plants were affected.

In the memo, several root causes were identified as well as actions required to avoid a recurrence.

The report said a lack of firm gas supply agreements was hampering the gas value chain and called for mandatory agreements for power plants deemed critical to keep the grid functional.

However, the government has yet to allow a liberal pricing regime in Nigeria despite clamour from operators.

A willing-buyer, willing-seller gas pricing regime binding on power plants will require tariffs that will guarantee commercial returns.

The Nigerian government has preferred paying subsidies and insisting on supply on credit. Hence, companies have no incentive to fix broken turbines or invest to deepen supply to the local market.

Recent attacks on oil infrastructure has ended up constraining gas production since more than half of the gas produced in Nigeria is developed in search of oil.

Over-reliance on gas to power is causing security of power supply risks, an improved mix is needed of utility scale hydro and solar power generation, the report said.

However, Nigeria’s grid is dated, overly centralised and has no provision for feed-in-tariff.

Power projects including Zungeru, Mambilla Hydro power plant and the Kashimbila hydro plants have stalled for many years mostly because they have poor investment cases.

Read also: Power Ministry confirms national grid collapse

The memo called for the designation of gas plants as strategic national gas supply infrastructure and the development of regulation to ensure minimum level of expected performance for licensees and owners.

It further called for improved rigour on outage planning by the System Operator and the integration of gas supply outages in the outage plan. It called for sanctions against power plants undergoing planned outages without obtaining approval.

Other recommendations include payment discipline and quick settlement of invoices and continued focus on infrastructure improvements to the transmission and distribution networks.

The memo said, “The lack of functioning SCADA and numerous Right of Way issues in the states are slowing progress on grid reforms.

“Post privatisation, we have belatedly started to transition funding away from consumption (in the form of subsidies) to infrastructure.

“Efforts to create additional private licensed grid networks to improve redundancy and accelerate infrastructure development should be encouraged.”

Ayodele Oni, partner in charge of the Energy Practice Group at Bloomfield LP, in a recent interview with Channels TV, said issues of mismanagement and poor infrastructure maintenance were hampering electricity supply.

“There is also a problem with the implementation,” he said. “To make the system work efficiently, every market should have a capacity element, an energy element, and ancillary services such as spinning reserves and others, all these works together to ensure the system works efficiently.”

Last Friday, the country’s power grid suffered another system collapse, the first this month and the third in 24 days, worsening blackout in Lagos and some other parts of the country.

The Transmission Company of Nigeria announced through its official Twitter handle that a vandalised transmission tower along the Odukpani-Ikot Ekpene 330kV double circuit transmission line was to blame for the latest national grid collapse.

Tweeting about the situation, Abubakar Aliyu, minister of power, said the collapse of the grid, which has since been restored, resulted in a loss of about 400MW.

“As a result, a slew of plants across the country were forced to shut down,” he said.