• Monday, May 20, 2024
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Make energy plans bankable to attract investment experts urge FG


The federal government aspiration to achieve sustainable power supply in the country can only materialise to the extent that the plans are bankable. Industry experts have observed.

To them the only way to attract investment to the power sector is for public policies to be strategic, transparent, consistent and have longevity.

According to experts, Nigeria’s challenges have nothing to do with situating the problem but everything to do with implementing a solution.

Experts in their various summations are worried that despite Nigeria’s large deposit of gas and a bankable amount of wind and sunshine in the north with water everywhere, the country cannot still boost of sufficient power supply.

Ayodele Oni, an energy expert observes that Power generation and supply continue to pose challenges on different fronts in Nigeria. For many decades, successive administrations have made “concerted efforts” to tackle the many challenges that have plagued the sector.

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Oni observes that a lot of the challenges in the power sector are largely occasioned by poor infrastructure, lack of sufficient funding, failure by the executive arm of government to pay for power, security issues and the uncertainty surrounding the present foreign exchange regime.

Tony Elumelu, chairman of Transcorp at a recent interview believes that the right mind set must be in place first to address the crises in the power sector.

He highlighted the liquidity challenges in the sector to be the results of non-settlement of debts owed Gencos and gas constraints worsened by government’s refusal to liberalise the sector.

“There’s a lot of debt being owed to us. The sector is challenged, debt, liquidity is a challenge.

“There is also gas issue. Of course, gas you will not blame government so much for the vandalisation going on in that sector.

Gas pricing should be market driven; price fixing does not really work. Gas is important and we should allow market forces to determine gas prices”

The Transcorp chairman proposed that government should create enabling environment for gencos to harness idle gas fields to provide gas for their operations.

“If you put invoice, you get paid about 15 or 20 per cent. The accumulated debt today is over N50bn and they started owing us when dollar was N168/$1 today, it is over N300/$1 so you can imagine the depletion, the erosion of value to shareholders of Transcorp.”

He also said that since the assumptions that led to the tariff structure agreed in the 2013 privatisation exercise such as exchange rate, inflation rate, gas prices have all changed the tariff cannot remain the same.