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Hassan S

Distribution remains Nigeria’s weakest link in electricity value chain—Minister

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The Minister of State for Power, Works and Housing, Mr. Suleiman Hassan has brushed aside, the claims of electricity Distribution Companies (Discos) that the key challenge facing them is shortfalls in transmission segment of the power value chain.

In an exclusive interview, he said “It is the issue of power purchase agreement currently being reviewed that has been frustrating the distributing company in delivering power to the ultimate consumer; That is where we have our weakest link as I told you”.

“You can’t transmit as much as what is generated; 7,000 megawatts, but a lot of power gets stranded like the other time we were saying that we have like 2,000 megawatts stranded and not reaching the distributors. It is either the census of the distribution company did not capture the people that are consuming, in other words; there is what we call power theft, people consuming electricity without paying for it.

“It is so because they are not really on the radar of the distribution company, so those power are lost some other power being lost again is not metered, there is estimated billing and the money made actually come back to the distribution companies.

Continuing, he said “The distribution companies also have their own problems; they don’t collect all the money that they are supposed to collect from the end user, why? Because they are not metered, also because they are not factored into it because if you live in a rural community one person may be metered while ten persons may be getting power from that same supply source to the distributive company, they don’t know that the power is going to that consumer but he still have to pay for it ultimately”.


The interview Excerpts:

We talked about power theft and that brings to mind the recent report that in 2018 alone, N10B was lost in the first quarter and what is responsible for that?

That is why a deliberate attempt is being made to get every consumer metered by either the distribution company or other franchise, that is been contemplated. Regulations are being rolled out now by the NERC; the regulatory agencies so that we can have a peaceful period during the metering for consumers.

Do you think that the policy on the pre-paid meter would work with the DISCO’s protesting vehemently and threatening legal action? Do you think that the federal government will cross this hurdle?

The essence of government is to make things a lot easy for the citizenry. So, we will look at what the frame work allows us to do.

We are discussing with the Discos to understand their own limits, know their own mandates within what was privatised to them and government will act in the best interest of the citizenry. We all have what was given to us as a government; the distribution company will look at what was given to them within the context of the contract, within the context of the privatisation clauses that are written there and within our own mandate as a government to see if we have to go to court. Yes we all have our grounds for taking actions and we are not afraid of going to court because if our actions are within the confines of our mandate as a government we are not afraid of going to court.

Let me bring you back to the generating capacity, you talked about 7,000 megawatts. I wonder if this is something to gloat about because it is still a foul cry going by what analyst says is the required capacity which is 20,000 megawatts for the minimum to have a considerable power supply, not even 100%, so isn’t it still a foul cry from what is expected?

I agree by our share size that we are generating highly inadequate power to meet our ultimate demand, but the question to also ask is that have we made progress from what we met?, where we were and where are we today that are the question that you are supposed to ask. Because if we are making consistent progress, I think that we are supposed to be given some kudos.

Now, let’s look at the procurement process, so much controversy has been growing on Nigeria’s Procurement Act. While some people see it as a bottle neck, some people feel that it is so porous that it has given way for some sharp practices, so what exactly has been your experience with the procurement process, do you think it needs to be amended?

I am glad that you said that it is a process, in a process you see deficiencies and you make amends to them, until you attain the perfect system you wish to attain. The procurement system, in its own rights is set out to achieve perfection for people that are qualified to supply goods and services which was the intention. If they were human factors, you can’t remove them because they are being operated by humans that we are also looking at to fine-tune them perfectly.

You talked about the Disco’s and on the part of the Disco’s too, they have also argued vehemently that the transmission arm is the weakest arm so far and they are lacking the required capacity to transmit whatever supply of power that is given to them.

I want to disagree, this a sector that holds a power meeting every month precisely on the first Monday of every month and this complains have never been tabled by the DISCO’s as far as I know. We always have a law of what was generated and what was transmitted by the transmission companies and honestly I cannot say that I have heard any DISCO complaining of the amount of power transmitted to it in any case. Transmission of power generated cannot be certainly, for the interest of our country, be given in the hands of one particular individual for the fear of taking the nation hostage.

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