Many Nigerians hopefully think that one day, the nation will attract enough foreign direct investment (FDI) to enable the develop development of electricity in the country. The hope is FDI will thoroughly refurbish, upgrade or expand the generation, transmission and distribution capacities of the [now] privatised Nigerian Electric Power Sector (NEPS) to provide customers with “constant electricity” supplies. Please think again! Foreign investors are not coming into Nigeria with $20 billion (at least) to revamp electricity in the country. Nigeria is in no shape to attract foreign investment, and it is unlikely it would have if things were going well. Does Grand Minister, Babs Fashola, disagree? The attraction of FDI is solely based on the assurance that if invested, it will yield ‘good secure’ profits for the investors. What other incentives are there for foreign investors to invest in Nigeria?
When last week Grand Minister, Babs Fashola (SAN), claimed his now-famous incapacity to revamp the Nigerian electric power sector was partly due to the inadequacies of Nigeria’s population census agency, he knew he was lying. Another grand act of blamocracy engendered by the Buhari administration. Nigeria’s electric power problems are primarily that of money (investment) and transparency (incorruptibility); it has nothing whatsoever to do with population census. Fashola did not even have to lie about Nigeria’s electricity development backwardness even though he lied about giving Nigerians an ‘electricity miracle’ in just 18 months if President Muhammadu Buhari won the 2015 general elections. Any fiens?
In 2000, Nigeria’s electric power sector had an underinvestment backlog bill of a minimum of $5 billion, $10 billion was more like it. That bill accrued during the period, 1984 to 1999, tacitly under the leadership of Generals Buhari, Babangida, Abacha and Abdulsalami according to the United States Trade and Development Agency. Olusegun Obasanjo squandered the best opportunity Nigeria had to invest in the electric power sector (2000-2007). Goodluck Jonathan also squandered a fair chance and blackouts were interestingly put up for privatisation. Now in 2017, the bill stands at about $20 billion minimum. The reality of electric power development is straightforward – if you do not have several billions of dollars to invest transparently and diligently, forget about it altogether. Nigerians should bravely accept they will not get constant electricity (24hrs all-year) for many years to come.
Does Fashola’s ministry have even just $5 billion to invest, a quarter of the minimum sum required to revamp the sector?
One of the big lies trumpeted of the electric power sector in Nigeria is the spectacle of “installed capacity”. For over 40 years Nigeria has been struggling hopelessly with 6000 MW installed capacity. Installed capacity is the generation capacity of the sector. Capacity is only a potential and does not automatically translate in electricity delivered to end-users. Despite Nigeria’s installed capacity Prof J B Akarakiri published a paper in 1999 in Energy titled ‘Private Electric Power Generation as an Alternative in Nigeria’. The paper was just three pages, but its implications were visionary and devastating; Nigeria should forget about the centralised electric power National Grid for its constant and sustainable electricity supplies; people should opt to their own generators if they wanted stable or on-demand supplies of electricity. Less than a year after the publication, Nigeria witnessed it’s first “zero installed capacity moment”, total national blackout.
Fashola has had a few “zero installed capacity moments” of his own since he became the Grand Minister.
Going back in time, in 2000 the National Electric Power Authority (NEPA) had on its books 1.6 electricity customers with 51% residing Lagos State even though, Nigeria had a 150 million population and Lagos State had 11 million. These figures indicated that just over 1% of Nigerians were electricity customers and Lagos State only 7% of the national population. It is evidence of gross nonfeasance and inefficiency by NEPA and the government. Research by the author carried out in 2002 demonstrated that in Lagos State, electricity customers were about 400% greater than what NEPA had recorded. Electricity meters for customers were scarce and expensive, power theft was rife, illegal (mostly unsafe) connections (to whole communities) rampant. Furthermore, tenement buildings (face me, I face you) that litter Lagos had ten to twenty families as tenants. Many tenants used microwaves, TVs, VCD recorders, boiling rings, electric irons in them using one meter and registered as “one customer”. How can peak demand and average daily demand for electricity supplied be appropriately calculated with such grossly underestimated customer data?
How many electricity customers does Fashola say the regulators claim they had on their books in 2017? Ask him.
In a properly run society, every regulator like energy corporations conducts its own customer-based census. It is called market research. Guinness Nigeria plc knows how many customers it has and uses it to determine growth areas, supply chain approaches, marketing strategies and more. It even uses such information to determine how many people are not drinking Guinness stout because they drink Star, Gulder, Trophy or other beers. If Guinness data management cannot be handled by itself, it would outsource the job to a reputable market research firm like RMS.
Fashola’s advisers should tell him the difference between per capita and per customer in market/sector analysis or planning.
What is the solution to the problem of electricity in Nigeria, many would ask? $20 billion and meticulously transparent oversight; any other technical explanations will have to start from here on. Where will Fashola find the money and are there enough honest personnel to get the job done? Environmental campaigner, Nnimmo Bassey, has persistently highlighted in the media how Nigeria loses over $1 billion annually in uncollected gas flaring penalties from oil production companies operating in Nigeria and also over $5 billion annually in tax fraud from oil services companies. That amounts to over $6 billion annually lost to the Nigerian purse; legitimate and deserved money. This money if honestly collected and invested, can clean up the Niger Delta and completely revamp the electric power sector in just five years. It is not Fashola’s problem but his boss, Buhari, is Minister of Petroleum. For all his anticorruption messianics, he has done nothing about this particular fraud and inertia.
Fashola does not have to be dishonest about the deplorable state of electric power in Nigeria. He unwitting inherited a disaster. And he can keep his blamocratic excuses for election time. Nigerians should know the realities of their electric power sector even though it is not pretty and “change” is faraway.
Anytime you hear that a new great ‘developmental project’ is being planned and undertaken by the Government of Nigeria (GON), it is important to identify who the short, medium and long term beneficiaries and losers created will be. Consultants, contractors, traditional land-owners, traditional rulers, government officials, board members and special interests groups are the short, medium and long term beneficiaries with a mix of obscene upfront fees, atrociously inflated contracts, preferential job offerings, generous concessionaire privileges under privatisation and convenient abandonment clauses. The 150 million ‘everyday Nigerians’ who the GON take out odious “development debts” on their behalf without asking them (by default) become the permanent losers but projected as winners by GON. This ‘development’ winners/losers dichotomy has now been moved to nuclear power, oil is failing. Continue reading
When President Muhammadu Buhari won the 2015 general elections, he did so largely with the support of neutral and anti-PDP (Peoples Democratic Party) commentators. Everything bad in Buhari’s life history was to be forgotten and everything good was in ascendance. From another perspective, it was very difficult for practitioners of competent thinking to justify the pervasive profligacy behemoth of PDP while in power. The ministerial appointments Babs Fashola, Timi Amaechi and other ‘gubernatocrats’ that took more than half a year to make that was the start of the negation of support for President Buhari. Many thinking men deserted except the likes of Wole Soyinka turned their backs on and pens against Buhari. But many political miracles were promised by the Buhari government. Where are they? Continue reading
The Senate probe into the management or mismanagement of the Nigerian Electric Power Sector (NEPS) is a long awaited and welcome undertaking. However, it is an undertaking that will trigger and sustain a lot of skepticism about its potential success in the minds of innumerable observers of various persuasions, both foreign and local. What will come of it?
There is a lot of chit-chat that one of the ”ministerless” wonders of the Buhari administration’s electricity supply to Nigerians across the nation have “improved”. The question is have the blackouts and brown outs stopped? Or has the kilowatt-hour per capita consumption measurably improved? This is an indictment of successive governments that have for decades underdeveloped the power sector then privatised it expecting magic. Electricity is now an “avoided cost” for the governemnt; is not willing to invest in the power sector, so it has been privatised. The cost of power project development many Nigerians expect the government to shoulder is no longer the its problem but it continues to use electricity as a potent political tool. Continue reading
For many years the Government of Nigeria seems to be managed by a class of “capability pole vaulters”. Government officials tend ‘pole vault’ the nation into many projects they lack the capability, will or wherewithal to execute or sustain effectively. The latest pole vault project is the establishment of nuclear reactors as power plants to provide conatsnt electricity in Nigeria. This is a nation that cannot independently manage its uncomplicated thermal and hydroelectric power plants with any efficacy or credibility. Continue reading