The Nigerian economy which is largely driven by the Medium Small Micro Enterprises (MSMEs) is currently battling for its soul as more companies are on the verge of collapse on account of epileptic power supply.
Statistics from Independent Energy Watch Initiative indicate that peak generation as at December 27, 2018 was a paltry 4,843.70 mega watts of electricity, a far cry from the average national demand of about 10,000MW.
According to the Managing Director of Seplat Petroleum Development Company, Mr. Austin Avuru, the Nigerian economy loses over N534 billion yearly to the inefficiency of the power sector.
Year-on-year, the Organised Private Sector (OPS) remains the worst hit as a result of poor electricity supply to majority of its member companies, leading to the closure of several manufacturing companies with its attendant effect on the economy.
According to Financial Quest, which quoted a draft document of the Power Sector Recovery Programme (PSRP), Nigeria’s economy is currently losing $29.3 billion yearly due to inadequate power supply.
On the other hand, capacity utilisation in companies remains very low because of lack of power, as they have to spend about 40 per cent of their production cost generating their own electricity.
The Manufacturers Association of Nigeria (MAN), raised the alarm that about 272 manufacturing firms shut down operations in 2016. The situation is even more troubling for small business owners who cannot afford to buy diesel or petrol to power their generating sets.
It was in the face of these daunting challenges that the Federal Government set up the Niger Delta Power Holding Company (NDPHC) Limited, owners of the National Integrated Power Projects (NIPP) to address the persistent shortfall in power generation, distribution and transmission.
Background to NIPP
The National Integrated Power Project (NIPP), is an integral part of Federal Government’s efforts to combat power shortages in the country. It was conceived in 2004 as a fast-track public sector funded initiative to add significant new generation capacity to Nigeria’s electricity supply system along with the electric-ity transmission and distribution and natural gas supply infrastructure required to deliver the additional capacity to consumers throughout the country.
In 2005, the Federal Government incorporated NDPHC Limited, to serve as the special purpose vehicle to contract for, hold, manage and operate the assets developed and built under the NIPP using private sector best practices.
The NIPP is being implemented jointly by the federal, state and local governments through the corporate vehicle of the NDPHC, a government agency owned by the three tiers of government but which operates strictly on the private sector business model. The NDPHC Equity Structure are as follows: Federal Government 47 per cent; 36 states, 35 percent; 774 local govern-ments, 18 per cent.
The scope of the NIPP covers the entire value chain in the power sector, namely generation, transmission and distribution, including building from the scratch a national gas infrastructure to power 10 gas-fired power plants across the country.
Power distribution intervention
The intervention of NDPHC through the rehabilitation of 39 km Ore to Okitipupa 33 kV line through Ode-Aye community in Okitipupa Local Government brought succor to them on Christmas day, after seven years of power outage.
There is also the improvement of electricity supply to communities in Ilaje Local Government of Ondo State, the project involves; rehabilitations of 5km Igodan-Lisa to Igbokoda 33kV line; 29km Igbokoda-MahinMahin-Ugbo-Nla 33kV line and the constructions of 10 km of 11kV lines, 20km of LT(0.415 kV) lines and installation of 10 nos distribution transformers.
Work has been completed on the projects and NEMSA invited for testing, certification before commissioning.
Work is equally on-going and about 70 percent completed on improvement of electricity supply to Okitipupa and Ondo State University of Science and Technology.
The project involves the construction of 1 X 7.5 MVA, 33/11 kV injection substation at Ondo State University of Science and Technology, rehabilitation of 5 km Okitipupa to Igodan-Lisa 33kV line; constructions of 0.5 km of new 33kV line, 6km of 11kV lines, 3 km of LT(0.415 kV) lines and installation of 10 nos distribution transformers.
The agency has also completed and NEMSA tested the construction of dedicated 52kM 33kV Line from Funtua TS to Malumfashi 1 x 7.5 MVA, 33 /11 kV injection substation. The project is awaiting issuance of certificate.
NDPCH has also achieved about 60 percent completion works on the upgrade of power supply to Daura town in Katsina State. The project involves the constructions of 10 km of 11kV lines 40 km of LT(0.415 kV) lines and installation of 10 nos 500 kVA,11/0.415 kV distribution transformers.
In the Southwest region, work is on-going and about 40 per cent target achieved on the upgrade of 1 X 7.5 MVA, 33/11 kV injection substation at Ile-Ife to 2 X 7.5 MVA.
The project involves the installation of additional 1 X 7.5 MVA, 33/ 11kV power transformer with associated switchgear and radiation of 5km of 11kV line from the substation.
Power experts have often described the transmission arm of the power sector value chain as being the weakest link, requiring about $7.5 billion to improve ageing transmission across the country.
But despite the meager resources at its disposal, the NDPHC has embarked on some transmission intervention projects to aid power supply. Some of the projects are; Otta 132/33kV substation expansion project, Otta – Papalanto new 132kV DC line, Papalanto 132/33kV substation expansion, Papalanto – Old Abeokuta New 132kV DC line construction, Old Abeokuta 132/33kV substation expansion.
Others are; Old Abeokuta – New Abeokuta 132kV DC line, New Abeokuta 132/33kV substation construction.
On the Eastern/ South- South axis; there is the construction of the 330/132KV 1X150MVA Transformer Substation at Ihiala, including Turn-In-Turn-Out of the existing Alaoji – Onitsha 330kV single circuit line at Ihiala by Energo Nigeria.
330kV Ihiala – Nnewi DC line by NCPE, 132/33kV Ihiala Substation, Ihiala 132kV line bay substation extension works, Afam – Ikot Ekpene 330kV DC line construction, Ikot Abasi – Ikot Ekpene 330kV DC line construction, Ikot Abasi 3X150MVA, 330/132/33kV substation construction.
The NDPHC has completed the following power plants; 750MW Olorunsogo, 450MW Sapele, 434MW Geregu , 450MW Omotosho, 450MW Ihovbor, 450MW Alaoji, 563MW Calabar and 225MW Gbarain. The company also completed 2,194km of 330KV transmission lines and 809km of 132KV transmission lines; an increase of 46 percent and 13 per cent respectively over the pre-NIPP status of grid infrastructure.
It has further constructed a total of 2,600km of 11kv and 1,700km of 33kv distribution lines for improving access to electricity.
In grid instability, NIPP plants provide about 265MW of spinning reserves to facilitate grid responsiveness during disturbances on the transmission network.
Some of the challenges that the NIPP has had to grapple with include security and community issues; right-of-way challenges for distribution equipment and transmission lines; port clearing coordination hitches and contractor performance-related problems.
Even though the three tiers of government own the NIPP, equipment imported for the power projects are often delayed or seized at the ports by the Nigeria Customs Service (NCS) because of non-payment of import tariffs thereby stalling the execution of some power projects. Sadly, some of the equipment at the ports were at one time auctioned by the port authorities after demurrage charges had accrued on them. It took the intervention of an alarmed Senate to recover some of the equipment sold off under questionable circumstance.
To fast track the attainment of stable electricity for Nigerians, the federal Government should seriously consider waving duties on equipment for power projects. It needs to seriously educate contractors on their patriotic duty to deliver and on time. There is need for a special para-military unit to ruthlessly tackle the activities of vandals, and address the kidnap of the employees of the contractors.
Host communities also need to be educated on the recurring problem of right-of-way for the routes for the 330kv and 132kv transmission lines of the NIPP. Once when NDPHC diverted the transmission line to the Ihovnbor station in Edo State at a considerable cost because of the presence of a shrine, a new shrine emerged overnight on the new route and the villagers went on demanding a huge amount to relocate it.
These constraints are surmountable and can be best handed with proper enlightenment of the responsibilities of civic duties. Also, operatives of para-military agencies, especially men of the National Security and Civil Defence Corps (NSCDC) should be adequately motivated and mobilized to protect power installations from vandals across the country.
An existing asset protection mechanism for the safety of power generation/distribution equipment like pipelines and plants must be established with technologically advanced means applied.
The coming of the NDPHC has helped Nigeria’s battle at solving her energy problems because modern day economy is driven by electricity supply.
The vision of incremental energy having not been faithfully pursued right from independence and oblivious of the exponential increase in population and socio-economy, it took the intervention of the NIPP to address fundamental issues.
If the company is continually funded and given free rein and the needed political backing to implement its mission, then the issue of power outage in Nigeria will soon be a thing of the past.