Nigeria Seeks New Buyers For Distressed Power Discos WithIn Three Months

The federal government on Monday disclosed that it was seeking within the next three months, new buyers for distressed power Distribution Companies (Discos), which were over the years taken over by  some banks and the Asset Management Corporation of Nigeria (AMCON).

Minister of Power, Chief Adebayo Adelabu, argued that banks and AMCON were not set up to manage those organisations which require sound technical know-how, stressing that the Discos will be sold to reputable power operators in the coming months.

Adelabu spoke when he received the members of the Senate Committee on Power, led by Senator Enyinnaya Abaribe, who were on an oversight visit to the ministry in Abuja.

The power distributors which were recently taken over by their creditors include: The Abuja Electricity Distribution Company (AEDC), managed by the United Bank of Africa (UBA) and the Benin Electricity Distribution Company (BEDC), which was taken over by Fidelity Bank and Afreximbank in 2022.

Besides, the Kaduna Disco,  Kano Disco as well as Ibadan Disco are currently managed by AMCON, due to their inability to pay off their loans to the lenders.

According to the minister, the management of energy distribution assets  remain in the technical realm and therefore should be managed by professionals.

Adelabu said: “We have put pressure on the Nigerian Electricity Regulatory Commission (NERC) to make sure that they raise the bar of regulatory activities on electricity distribution companies. If they have to withdraw licences for non-performance, why not? If they have to change the board and management, why not?

“All the Discos that are still under AMCON and bank lenders, within the next three months, they must be sold to technical power operators with good reputation in utility management.

“We can no longer afford AMCON or the banks to run our Discos. This is a technical industry and must be run by technical experts.”

Adelabu also identified inadequate funding as well as vandalism of electricity infrastructure as some of the problems in the sector, arguing that reliance on the national grid has to be reduced.

He urged sub-national governments to take advantage of the new electricity law and invest in power in order to provide some form of backup for the national grid.

He further reiterated that power generation in the country will be raised from the current average of 4,000mw to 6,000mw in the coming months.

Also speaking, the Managing Director of the Transmission Company of Nigeria (TCN), Sule Abdulaziz, who also received the senate delegation separately,  urged the members to assist in getting more funding for the over 100 uncompleted projects being overseen by the company.

“Let me start by saying that what we are doing here in TCN  is trying to expand the grid. As you know, the power system is dynamic. It is always increasing and the people who demand light are always increasing in number.

“So we cannot say that we have finished expanding the grid. Presently, we have over 100 ongoing projects  and if we are able to finish them, it will add a great value to the national grid.

“I want to take this opportunity to appeal to the committee to help TCN with funds to complete these projects because these projects are hanging for almost 20 years. There are some that started in 2001. The major problem we have with these projects is funding.

“There are some of them which also have problems with the Right of Ways (RoW) which we are making efforts to contact our state governors to help us resolve these issues. Secondly, there is the grid visibility. As everybody is aware, TCN doesn’t have a full SCADA system.

“Even though the World Bank has helped TCN in giving contracts for the SCADA, but this will take at least two years to be completed. So what TCN is doing now is to make an in-house innovation whereby we can see most of the stations, the generation and transmission stations.

“Almost two-thirds of the stations can be seen from our Internet of Things (IoT) system. Another issue we are facing is vandalism. We have reported so many times the extent of vandalism we are having in this country, especially in the North-east.

“A lot of transmission lines were vandalised and some stations that are uncompleted, especially in the South-east, which because of lack of transmission lines, we are not able to energise these stations. People went there and vandalised them,” he stated.

He urged the committee to enact a law which will allow TCN to have easy access to  right of way nationwide, stressing that the organisation was also trying to build a super grid.

“Now, everybody knows that TCN does not have the money to build the super grid. So we are collaborating with some Chinese companies that will bring money from Chinese banks to do that project.

“By the time we are looking for approval, we are appealing to the committee to give us the approval so that we can have that super grid. If one of the lines is faulty, we can use the other one to transmit power. But the problem we are having is also funding.

“If we can look at our 2024 budget, the money we have there is less than N2 billion and we are talking about how important power is. In fact, that thing cannot do anything. That’s why TCN decided to put that amount under compensation. We didn’t put money into any other project,” he revealed.

In his remarks Abaribe said the incessant electricity grid collapses were unacceptable, stressing that Nigerians were tired of excuses. He noted that the oversight visit became necessary to find out the challenges that had led to poor supply of electricity to Nigerians

He further disclosed that the senate had set April 29, 2024, aside to convene an investigative hearing into the recent issue of tariff hike in the country, lamenting that Nigeria had become the butt of jokes because it cannot supply electricity to its people.

“And so we are here, to hear directly from TCN what the problems are and whether there is anything we can do  using the law to make Nigeria one of the countries that don’t have to depend only on their own installed capacity,” he stated.

Some other lawmakers on the delegation were: Senator Dajuma Goje (Gombe Central), Simon Lalong (APC, Plateau South), Osita Izunaso (Imo West), among others.

Emmanuel Addeh

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