That Sambo’s Ultimatum – By Arnold A. Alalibo

Posted by admin Arnold Alalibo, Articles, Columnists, NNP Columnists Thursday, June 5th, 2014

By Arnold A. Alalibo | NNP | June 5, 2014 – Since the unbundling of the Power Holding Company of Nigeria, PHCN, and the sale of its successor companies to private investors, each day seems to bring fresh anxieties that the privatization of the sector may not produce the desired immediate succour to the nation’s power challenges.
Indications point to the fact that the current waning power supply and energy crisis may persist longer than thought. The Vice President, Namadi Sambo, worried by the situation, recently indicted contractors handling some power projects across the country at a recent meeting with them at the Presidential Villa.
Available evidence indicate that some of the contractors abandoned work at some feeder power stations located in Enugu, Jos and Port Harcourt distribution companies. Consequently, the vice president gave the contractors two months ultimatum to complete and hand over the project or be blacklisted.
The lackadaisical attitude of the contractors to work on power projects has caused serious setback to the much-expected improvement in power supply in the country. Indeed the lazy attitude of the contractors in handling such critical projects is unacceptable. It is a reflection of the pervasive fundamental issues that bedevil the development of the energy sector in the country.
This is the reason the sector, instead of meliorating, has degenerated to such an abysmal level that the country can only generate a paltry 3,000 megawatts of electricity. In spite of government’s assurances of regular power supply, especially in the aftermath of the privatization of the sector, the situation remains unchanged. This development puts many questions across that beg for answers.
The optimism that followed the privatization of PHCN and the emergence of new generating companies is crashing fast. I thought by now the new administrators would have overcome the initial obstacles associated with transition and stabilised the sector. But the way it is now, there is hardly any optimism that there is light at the end of the tunnel. Nothing has changed. It is the same epileptic power supply we have always known.
The vice president has done well by issuing the ultimatum. It is in the interest of the contractors to take the ultimatum seriously and complete all the outstanding projects without further delay. It is sad that after expending so much money on electricity projects in the country, with more money being proposed to be spent in the years ahead, there is no improvement in power supply.
Clearly, the power sector is gradually becoming a bottomless pit. At a recent power sector financing conference in Abuja, the federal government declared that it would need about a prodigious N143 trillion to fix the sector in the next 30 years. Similarly, the Managing Director of Transmission Company of Nigeria, TCM, Mr. Mack Kast, said N1.2 trillion was required to improve electricity supply in the country.
I feel very disappointed that in spite of the huge money that has been spent and the projections for future expenditure on power projects, the situation is worsening daily. Despite the privatization of the sector and the emergence of the GENCOs and DISCOs from which about $480 billion was realized, we still grapple with the age-long problem.
One is fed up with the constant excuses of the government and the extenuation often expressed by the new electricity company owners. They can only be taken as covers for the apparent failure to deliver on the power sector. It is a clue that the reform in that sector is running into a hitch.
Nigerians expect that several months after the formal takeover of the 14 successor generation and distribution companies by private investors, there should be remarkable improvement in power supply across the country. Instead, the situation is worsening. Complaints about over-billing by consumers have also added to the many troubles of the sector.
Given the significance of power to the economic growth of a nation, it is time issues that plague the power sector were taken seriously. Besides being the engine that stimulates economic development, uninterrupted power supply is vital to foreign investment inflows into the country.
It is common knowledge that the protracted crisis in the sector has caused the closure of many industries in the country with attendant job losses. Many of the companies had to relocate to neighbouring West African countries with better power facilities. Those who have defied the situation and chose to operate in the country are clenching with high production cost because of epileptic power. It was for this reason the World Bank, last year, rated Nigeria very low on the scale of countries that are conducive to doing business.
It is expedient for all who have the responsibility of reviving the sector to sit up. The ultimatum handed the contractors by the vice president is not the first time. I challenge the authorities to take the deadline seriously and ensure that it is enforced. It is only then Nigerians can wake up to the reality that government is ready to address the fledgling power sector in the country.wp_posts