Electricity Act: Nnaji Canvasses Regional Power Projects, PPP Model

* Wants states to enact, enforce regulations to curb power theft

Ndubuisi Francis in Abuja 

A former Minister of Power and Chief Executive Officer (CEO) of Geometric Power Ltd., Prof Bart Nnaji, has urged states to take advantage of the decentralisation of the ownership and control of power infrastructure with the aim of partnering for the establishment of regional power projects.

Nnaji also advised state governments to employ public private partnerships (PPPs) in procuring power infrastructure in their states.

The one-time minister spoke in Abuja when he presented a paper at the first quarter 2024 Nigeria Public Private Partnership Network (NPPPN) meeting which had as its theme: ‘The Decentralisation of the Nigerian Electricity Supply Industry (NESI) and the Role of the States in Rural Electrification: The Private Investor’s Perspective’, a statement issued by Head, Media and Publicity, Manji Yarling said.

In his presentation, Nnaji noted that although ownership and control of power infrastructure have been decentralised, it still would not be easy for states to wholly jump into it given the cost, technology implication and adverse competition where states seek to control the infrastructure.

He prescribed that the better option was for states to take advantage of the decentralisation to partner and establish a regional grid because of the cost.

“There are a number of states that believe that they can easily jump in and begin to develop power infrastructure, but the sort of financial requirement to build power infrastructure is quite a lot. 

“In Nigeria, depending on the fuel source, it will cost about $1.5 million per megawatts. That is a lot just for 1MW and that is just to build the power plant, and you haven’t built the sub stations and all the other required infrastructure.

“So, this is why it is very important that partnerships be strongly encouraged. Public private partnership is what delivers success; where states play their role and make their contribution.

“However, if the states decide that they want to be in control then we are going back to the NEPA days and that can be a serious problem,” he said.

While applauding the decentralisation of electricity supply, he stressed that it would empower local entities to manage their own energy resources, improve efficiency and ensure that supply is more responsive to local needs and less vulnerable to systemwide disruptions or collapses.

He, however, explained the need to have a cost-reflective tariff to further encourage private sector participation, adding that states must enact and enforce regulations to curb power theft.

Fielding questions after the presentation, Nnaji encouraged power companies to do what it takes to stop power theft. 

He encouraged them to deploy technology as has been done in Abia State to combat bypassing of meters.

Earlier, the Director General of the Infrastructure Concession Regulatory Commission (ICRC), Michael Ohiani, said that the meeting afforded participants the opportunity to deliberate on the serious national issue of power.

“Every hand needs to be on deck as the nation cannot witness significant development in the absence of adequate power supply” he said.

According to Ohiani, the theme presents an opportunity to brainstorm and proffer solutions to economic stagnation in states due to inadequate power supply.

He commended the 26 states in Nigeria that have enacted their PPP laws, stressing that the laws will incentivize private sector involvement in the state.

He pledged the support of the ICRC to help members of the network seeking to undertake PPP projects and also states that want to enact their laws.

The meeting was declared open by the Director General of the Nigeria Governors’ Forum (NGF), Asishana Okauru, who said that the meeting was apt in view of the transformations ongoing in the power sector.

The electricity industry, he noted, had undergone significant changes in recent years, adding that the discussions at the meeting will provide insights into roles of states in electrification, including rural areas.

He stated that the involvement of states would improve access, adding that state governments could deploy power infrastructure that are tailor-made to their needs.

The NGF DG however, cautioned states on inconsistent policies and bureaucracies that can hamper the actualisation of the gains of the decentralisation.

The meeting also featured presentations by the Rural Electrification Agency (REA), Nigeria Electricity Regulatory Commission (NERC), as well as goodwill messages from  the Senior Special Adviser (SSA) to the President on Community Development, Chioma Nweze and the Commissioner for Economic Planning & Budget, Lagos State, Mr.George Ope.

The Deputy Governor of Ebonyi State, Mrs. Patricia Obila, gave the closing remarks.

The NPPPN is a network of 36 states including the FCT, with the ICRC serving as the Secretariat. 

Of the 37 member states, 26 have enacted their PPP laws, while others are at different stages of enacting their regulations.