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16 years of National Integrated Power Project (NIPP) and challenges of it privatisation

NDPHC to add 125 megawatts to national grid in Q1 2023

Prior to the coming of the new Democratic Government in 1999, the Power Sector had gone over 20 years without a single investment, thereby making the investment that would be needed to revive the sector a massive one.

In order to fast track bringing different government funded project mainstream, The National Integrated Power Projects, NIPP, was conceived in 2004, under the President Olusegun Obasanjo Administration, as a Government funded quick intervention in the ailing Power Sector that was inherited by the new Civilian Administration.

At the onset of conceptualization of the ideals of NIPP, the National Council of State (NCS) and the National Assembly approved an initial funding of $2.5 billion as seed fund for the National Integrated Power Project (NIPP) from the Excess Crude Oil Account.

The Niger Delta Power Holding Company Limited (NDPHC) was thereafter incorporated as a limited liability company to serve as the legal vehicle to hold the NIPP assets and further crystallized the novel ideals of the NIPP concepts.

Today, the NIPP, under the Niger Delta Power Holding Company, NDPHC, has entered the second phase of its implementation.

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The Phase I of the NIPP comprises majorly of the ten gas-fired plants developed by the Niger Delta Power Holding Company (NDPHC) are privatized so that the proceeds can be used to invest in power projects in other parts of the country not captured under the first phase of NIPP, especially the Northern region where NIPP plants are not located. The Federal Government, in 2013 commenced the privatization of the gas-fired plants. Proceeds from sales of 80% equity of NIPP Generation Assets are to be ploughed back into the joint coffers of the Federal, State and Local Governments and reinvested in the NIPP phase II.

These 10 Gas-powered Plants are Olorunsogo II Power Plant, Geregu II Power Plant, Gbarain II Power Plant, Alaoji Power Plant, Omoku Power Plant, Egbema Power Plant, Sapele Power Plant, Omotosho II Power Plant, and Calabar Power Plant.

At completion of the Phase I, NIPP power plants are by their original mandate designed to collectively add an additional 5,000 MW of gas-fired generating capacity to the Nigerian Electricity Grid Value Chain.

The Phase I of the NIPP Projects also includes Transmission Projects. As at May 2016, the overall completed 330kv transmission line is 1336.9KM (against contracted 1634.4KM) representing 82% completion. Completed 132kv transmission line is 405.5KM (against contracted 719.3KM) representing 56% completion. In addition, the overall completed 330/132kv transmission substation capacity is 3810MVA (against contracted 6000MVA) representing 64% completion, while completed 132/33kv transmission substation capacity is 1920MVA (against contracted 3100MVA) representing 62 percent completion.

The Distribution sub-sector also gained from the quick intervention of the NIPP. A total of 296 No. distribution projects grouped into 43 Lots spread throughout the country were awarded in February, 2007. Each of these projects included injection substations of varying capacities ranging from 2.5 MVA through 7.5 MVA to 15 MVA, with associated 33kv and 11kv distribution lines complete with CSP transformers to serve numerous customers across the country.