More details are emerging on the N72 billion financial facility plans by the Nigerian government from which the 11 electricity distribution companies would upgrade and expand their networks. The EnergyNewsTM team found out that the facility would be a shareholder loan that the Discos have been asked to match or convert to equity.
This is because, in the Discos’ privatization terms, the government is a 40 percent shareholder while the core investors of the Discos own a 60 percent stake. For this reason, the government has indicated that the Transmission Company of Nigeria (TCN) would be the source of the facility as well as act as its manager.
The Minister of Power, Works and Housing, Mr. Babatunde Fashola, said: “the government plans to invest the sum on the Discos”. He also said that the financial facility would help the Discos expand their networks so that they will be able to supply stranded electricity from the generation companies (Gencos) to electricity consumers in the country.
The Managing Director of TCN. Mr.U G Mohammed had said at the commissioning a 60MVA transformer at the Bauchi transmission substation that TCN had approached the government to allow it assist the Discos to upgrade their networks. According to him to assist Discos in this regard, we approached the federal government and they agreed that TCN would invest in distribution on behalf of Ministry of Power, Works, and Housing. We already have the N72 billion which has been approved by the Federal Executive Council for this purpose.
He said “Where we discover that we have much load and that load cannot be taken by the Disco, we apply this fund to assist in expanding that network so that it can take the load. The fund is like shareholder loan to distribution companies which they must match or it will be converted to equity,”
According to him, “From June to date, TCN engineers have installed more than 18 power transformers including the 60MVA 132/33kV power transformer here in Bauchi transmission substation. The new power transformer was installed 100 percent by TCN engineers. We are working very hard to create the Transmission Rehabilitation and Expansion Programme (TREP) stage two and that will involve building a line from Calabar to Kano and this has gone very far because we have gotten an organization that will provide us with a grant to do the study and that meeting will take place. We would continue to do all we can to ensure that the grid continues to grow into a very robust transmission network.”
He noted that TCN has continued to expand the transmission network, and added that it has in the past 11 months, installed more than 18 power transformers using its in-house engineers.