On the sidelines of the June 2007 G8 Heiligendamm Summit, Chancellor Angela Merkel met with President Shehu Musa Yar’Adua who had just been elected. In response to a question by Chancellor Merkel to President Yar’Adua on how her government could be of support to Nigeria, President Yar’Adua said he needed power. A shocked Merkel quipped, “But you are already the President.”
Realizing that he had been misunderstood by Merkel, Yar’Adua clarified that he wanted support to solve Nigeria’s electricity problem. This sort of misunderstanding of jargon is not unusual, as power in Nigeria is used to refer to electricity, while in other advanced nations, including Germany, energy is broadly used to refer to the diverse existing resources and potentials through which electricity and other forms of energy can be derived. It is from this concept that Germany’s energy transition – Energiewende was coined.
The perception or “misunderstanding” of energy in Nigeria is principally responsible for the structural problems in Nigeria’s energy system. We have separate Ministries of Petroleum Resources, Water Resources, Power and then an Energy Commission whose influence is insignificant when it comes to energy policies and implementation of power or electricity generation projects. This imbalance leads to bureaucratic challenges for effective collaboration and coordination in harnessing Nigeria’s energy resource potentials.
Yar’Adua secured Merkel’s promise and commitment to help solve Nigeria’s electricity challenges. Within a year after the Heiligendamm Summit, Nigeria and Germany signed the German-Nigerian Energy Partnership in 2008. The focus of this partnership which was renewed in 2013 was to purse joint projects for the rehabilitation and further development of electricity production in Nigeria – especially through renewable energy and improved energy efficiency projects. An important aspect of this partnership to Germany was that the projects undertaken would have a greater involvement of German companies.
It has been 12 years since that 2007 Heiligendamm Summit meeting with President Yar’Adua, in addition to several other meetings and bilateral talks between Nigeria and Germany. Merkel has delivered on her commitment to Nigeria in getting leading German energy firm, Siemens AG, to sign the Nigeria Electrification Roadmap (NER) with the Nigerian government in a new partnership that hopes to transform Nigeria’s electricity sector.
The roadmap which is a three-phase programme aims to ensure that all electricity transmission and distribution challenges are solved, existing generation assets and distribution capacities optimally operationalized to 11,000MW by 2023 and finally upgrading and expanding of the grid capacity – generation, transmission and distribution networks to 25,000MW.
The NER which complements the Nigeria Energy Support Programme II (NESP II) sponsored by the German government is the very first strategic, feasible, integrated, workable electricity sector plan undertaken by the Buhari government after the $350 million World Bank sponsored Nigeria Electrification Project (NEP) partly dedicated for mini grid development – which is a component of the unrealistic Power Sector Recovery Programme (PSRP). For the very first time, government is finding a solution to the inadequate transmission and distribution networks to get the stranded generated electricity at the electric power stations down to the consumers.
Sometime in early 2017 when I visited an electric power substation in Nigeria’s Federal Capital Territory, Abuja for a study, the duty engineer informed me that out of the 50MW supplied to the substation, only 14MW was being distributed for use by the distribution company (Disco) that operates in the region. On enquiry, the engineer mentioned that the Disco lacked the required infrastructure to evacuate the entire 50MW; and for corrupt reasons preferred to only bill and collect the fixed charges from customers without prepaid meters – which they wouldn’t have to remit and account for to the Nigerian Electricity Supply Industry (NESI).
This meant that the 36MW not distributed must be paid for by government; in this case, NBET using the Payment Assurance Guarantee (PAG) which pays for the revenue shortfalls to generating companies (Gencos). In simple terms, it’s impossible for the NESI to be solvent without fixing the transmission and distribution challenges which government neglected over years while focusing on increasing generation supply.
While the roadmap is highly commendable and should be supported by all NESI stakeholders, there are still areas of significant concern that government must take note of for it to solve the problems it was designed for.
First, tackle the corruption and accounting indiscipline of the Discos. Second, respect and uphold the independence and regulatory authority of the Nigerian Electricity Regulatory Commission (NERC) to sanction non-complying NESI actors especially Discos when they default without the usual interference from the executive arm.
Third, develop a fail-proof system of ensuring that all electricity consumers especially big consumers – the privileged rich and influential, including government MDAs, pay for electricity consumed – which has not been so. Fourth, work closely with law enforcement and the judiciary to ensure that consumers and persons who commit crimes that impede the effective performance of the NESI are lawfully prosecuted. An important aspect of this is respect for the rule of law in Nigeria.
Fifth, ensure that the process of implementing of NER is appropriate and adequate for the transfer of technology through targeted capacity building and involvement of local Nigerian companies for sustainability purposes.
Finally, government must fully commit to the effective implementation of grid complementary – off-grid and decentralized electricity projects across the country to help reduce the pressure on the grid, and increase access to electricity services to consumers who wouldn’t be easily served by the grid.
These measures will help in stabilizing and transforming Nigeria’s grid infrastructure for optimal efficiency, and also help accelerate the integration of renewable energy solutions to the electricity market using mechanisms such as net metering and feed-in-tariff.
Akachukwu Okafor
Okafor is the Founder and Principal Partner, Change Partners International, [email protected].
