Reps to review power sector reform policy
…As sector records widespread losses associated with insufficient gas supply
House of Representatives Committees on Power and Privatization have been mandated to review the extant laws, regulations, policies, and contractual arrangement guiding the Power Sector Reform.
The mandate from the leadership of the House last Tuesday comes on the heels of reported data depicting widespread losses associated with insufficient gas supply distribution infrastructure and transmission infrastructure last month.
According to data obtained from the Advisory Power Team, Office of the Vice President, the value of the losses is N65.64 billion in April 2020, about 33.6% up from N49.1 billion recorded in the corresponding period of 2019. The House committees were directed to review and investigate activities of the Nigerian Electricity Supply Industry and submit the report within four weeks.
Investigations show that the poor state of power has impacted on many stakeholders, especially households, manufacturers and other private sector organisations.
To shore up power, the National Secretary, Nigeria Electricity Consumers Advocacy Network (NECAN), Mr. Uket Obonga, said the federal government has no option but to increase funding for the Transmission Company of Nigeria (TCN). “Operators in the oil and gas industry should make efforts to supply more gas for power generation, while the electricity generation companies (GENCOs), should make efforts to pay the right price for it.
“On distribution, we know that the distribution end in the power chain is the weakest link and it is in a very poor state due to lack of investments, the DISCOS have not really invested in their networks,” he said.
The current DISCOs are said not to have the financial and technical capacities to manage the franchise areas currently given to them and because the areas are too large. “We are suggesting that the areas should be reviewed and immediately reduced to a manageable size so that whatever is taken out of them can be given to other investors,” he said.
He suggested that the federal government should organize a nationwide customer enumeration exercise to determine the actual number of electricity consumers in Nigeria as this will help to know what the DISCOs are actually collecting and remitting.
Meanwhile, upon the adoption of a motion of urgent public importance on: “Need to Review and Investigate the Nigerian Power Sector”, sponsored by Ifeanyi Momah (APGA, Anambra). Momah said the House noted that before 1998, the National Electric Power Authority (NEPA) was almost exclusively responsible for electricity generation, transmission and distribution in Nigeria.
As a result of this, the federal government birthed the Electricity (Amendment) Decree 1998 and the National Electric Power Authority (NEPA) (Amendment) Act 1998 which once passed, terminated the monopoly status of NEPA and invited private sector participation in the electricity sector. According to the lawmaker, this eventually led to the National Electric Power Policy of 2001 which served the purpose of kicking off the power sector reform in Nigeria, leading to several other reforms over the last two decades.
Momah said the House also noted that this reform process led to the National Assembly passing into law, the Electric Power Sector Reform (EPSR) Act 2005 which provided for: “An Act to provide for the formation of companies to take over the functions, assets, liabilities and staff of NEPA to develop competitive electricity markets, to establish the Nigerian Electricity Regulatory Commission; to provide for the licensing and regulation of the generation, transmission, distribution and supply of electricity; to enforce such matters as performance standards, consumer rights and obligations; to provide for the determination of tariffs; and to provide for matters connected with or incidental to the foregoing.