BPE: N461bn Realised from Sale of Power Assets

Damilola Oyedele in Abuja

The Bureau of Public Enterprises has disclosed that the sum of N461.4 billion was the total proceeds from the sale of power assets, including deliverables, in the privatisation of the power sector between 2013 and 2015.

The organisation however expended N374.8 billion on the disengagement benefits of workers of the Power Holding Company of Nigeria, N53 billion for the bulk companies, and N9.5 billion for transaction costs, leaving the government with the sum of N23.3 billion.

The balance of N23.3 billion has been transferred to the Treasury Single Account (TSA) in 2015.
These details were presented to the House of Representatives Ad hoc Committee on the alleged non-transparent and fraudulent sale of power assets by the BPE at an investigative hearing yesterday.

The Acting Director General of the BPE, Mr. Vincent Akpotaire, told the committee that the 11 power generation companies were sold for the same of $1.4 billion, while the distribution companies were sold for $1.03 billion, making a total of $2.44 billion.

The committee headed by Hon. Ahmed Idris (Plateau) however queried why there has been no significant improvement in power generation and distribution, since the conclusion of the exercise which was expected to make the sector more efficient.

The committee also noted that the N213 billion power intervention fund provided by the Central Bank of Nigeria (CBN), has not yielded the desired results, adding that the government has recorded losses in revenue and anticipated services in the power sector.

Hon. Istifanus Gyang (Plateau PDP) said the Bureau of Public Procurement had cautioned against the award of the contract for the management of the Transmission Company of Nigeria (TCN), to Manitoba Hydro International (MHI), even though the contracted was eventually awarded for the same of $23.3 million.
“Your disregard to the objections of the BPP to the contract you awarded to Manitoba was what brought us to where we are today,” he said.

Akpotaire however disagreed that Manitoba did not improve the fortunes of the TCN.
“From the records available to us, Manitoba was able to strengthen capacity and achieved reduction in transmission loss from 12 per cent to 5.6 per cent,” he said.

Hon. Dan Asuquo, (Akwa Ibom PDP) who is the Chairman, House Committee on Power, however insisted that the BPE did not manage the privatisation of the power sector efficiently.

“Some of the companies that bought the power assets, were they fit in the first place to be the preferred bidders? Could this be part of the problems we are facing today? Is there a case of lack of capacity? Asuquo said.
The Acting Chairman of the Nigerian Electricity Regulatory Commission (NERC) Dr. Anthony Okah, said the commission was not really a part of the privatisation exercise as it did not participate in the evaluation of most assets before the sale.

He, however, conceded that the commission participated during the evaluation of the distribution companies.
Idris pointed out that evaluation of the distribution companies only, does not exonerate NERC from the mismanagement of the privatisation process.

“If you were involved in the valuation of the Discos, then you are a participant. You have questions to answer because BPE acted based on your advice and valuation report,” Idris said.