Council seeks N160b yearly for power transmission

By John Ofikhenua
In Nigeria
Aug 18th, 2014
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The inaugurated National Council on Power (NACOP) is seeking N160 billion yearly to fund the Transmission Company of Nigeria (TCN) to achieve a cost reflective tariff.

This is part of its recommendations during its conference last week in Abuja.

The  council includes  stakeholders from the operators, state governments, commissioners, Federal Ministry of Power and agencies in the sector.

According to NACOP, 75 per cent of the fund should be set aside for Capital Expenditure (CAPEX).

The document said: “ Until such a time that a cost reflective tariff is established and 90 per cent or greater of annual earned market revenue is received, it should be ensured that annual funding provided for the Transmission Company of Nigeria (TCN) from market, appropriations sources is not less than N160billion, with 75 per cent fund earmarked for Capital Expenditure ( CAPEX.).”

NACOP said until such a time when appropriations are required to fund the TCN, employee salary, employee benefits, and critical business infrastructure needs should be funded from appropriations on a prorata basis, based on the prior year’s earned market revenue shortage percentage.

It set a target of 6,500Mega Watts (MW) by the end of the year.

The council also recommended a medium term target for transmission capacity and capability of 12,000MW and 10,000MW by the end of 2016.

NACOP also urged the development of a bankable coal to power study to minimize in coal plant development.

The council sought the encouragement of the development of small scale power plants as embedded generations which can be increased to evacuate the 132kV for eventual ceding to distribution companies.

It recommended that the Federal Government should encourage manufacturing of power assets and components.

NACOP urged state governments to take stakes in Independent Power Projects ( IPPs).

It recommended that the Federal Government should bank securitisation either through the Nigerian Bulk Electricity Trader (NBET) or the Federal Ministry of Finance.

The council urged state government to make land with certificates -of -occupancy readily available to potential investors as incentive.

NACOP sought a robust development plan from the Nigerian National Petroleum Corporation (NNPC) and a commercial gas rate to attract investors.

It urged the signing of Gas Security Agreements and Gas Transportation  Agreements.

The council sought a national policy on securing gas oil infrastructure , payment of outstanding gas debt and passage of the Petroleum Industry Bill (PIB).

The Managing Director of Abuja Electricity Distribution Company (AEDC) , Neil Croucher, at the weekend said that the firm will inject about $200 million in five years to boost power supply and distribution in its coverage area, Kogi, Nasarawa and Niger states.

According to him, no fewer than 20 injection substations would soon be inaugurated by his company and  these would deal with the pockets of low voltage being experienced in some areas.

The company in a statement yesterday said Croucher appealed for patience by all customers of the company, saying that due to the decrepit equipment that the AEDC inherited, it would take huge investments, which his firm is committed to, and relatively long period before significant improvement in power supply would be achieved.

He spoke when the FCT chapter chairman of the Manufacturers Association of Nigeria (MAN) Dr. Wasilat Shittu, led a team of officials of the group to meet with executive members of the AEDC in Abuja.

The AEDC and MAN agreed to collaborate towards improving power supply to the various industrial sites in the Federal Capital Territory (FCT) and beyond.

According to Shittu, many industrialists in Abuja and environ had refused to connect to the national power grid to avoid the damage that frequent interruptions in power supply could cause to their equipment.

She said, however, that with the privatisation of the power sector and the “noticeable improvement” in electricity supply in the territory, MAN was encouraged to visit the AEDC to discuss the possibility of having “stable and quality” supply of power to their industrial sites.

“We appreciate that it’s no longer business as usual. I was a civil servant and so when I talk about business as usual I really know what it means. However, we need assurance of greater improvement in supply so that more of our members would connect to the national grid”, she said.

Croucher listed numerous high impact projects that the utility firm was executing to ensure a boost for power supply.

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