• Monday, May 27, 2024
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Experts advocate developing right investment policies to solve electricity challenge

Experts advocate developing right investment policies to solve electricity challenge (1)

Energy experts have advocated that the Federal Government advance the right investment policies in its power sector to solve the electricity challenges. They observed that a stable and reliable electricity supply is vital to economic development and growth adding that forward-looking countries are proactively developing infrastructure and anticipate continued investment.

The Nigerian government is aiming to increase the current 45 per cent direct access to electricity of its population to 75 per cent by 2020. Industry observers expect that this investment in infrastructure and the development of more reliable and stable supplies will create many new opportunities in the short and medium-term.

The biggest challenges facing the energy sector across Nigeria is reliable access to electricity and the shortfall in energy generation. As the electrification of the country continues, investment to fund this ongoing development continues to be high on the agenda. Wunmi Iledare, an industry analyst is of the views that among the challenges of power within Nigeria surround illiquidity in the sector and the non-viability of power generation due to the non-payment of tariffs by end-users of power.

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This he observed has led to the inability of generic companies to maximise installed and generating capacity. The foregoing has fed a vicious cycle of underperformance in the industry, as generation companies are unable to make payments to gas suppliers, and end-users bear the inordinate cost and responsibility of private generation of power through generation sets.

He noted that close to 90 per cent of government revenue comes from oil; fluctuation in the oil price has reduced available investment for projects. Currency deflation and deregulation is also a challenge o the power sector. According to analysts, “Continued infrastructure development also presents the opportunity for utilities into future- proof networks. By moving away from traditional design models towards more active network management, utilities can take into account the challenges presented by the growth of. Distributed energy resources”

They pointed out that apart from the foregoing; vandalisation of gas pipelines which hamper the adequate supply of gas to power plants has plagued the current power climate in Nigeria. Experts in the power sector think that the industry will get to a stage where government participation in the sector is completely on regulation while private investments are attracted owing to the enabling environment.