Tinubu Expresses Concern Over Nigeria’s Power Sector Privatisation Performance

President Bola Tinubu has raised concerns about the performance of Nigeria’s power sector privatisation, which was carried out about a decade ago.

During a roundtable discussion on privatisation in the Nigerian Electricity Supply Industry, Tinubu noted that the sector had failed to meet its objectives.

He emphasised that the national grid was serving only about 15% of the country’s electricity demand.

This is a significant shortfall from the target set by the government before privatisation, which aimed for a capacity of 40,000 MW by 2020.

Tinubu highlighted several challenges facing the power sector, including commercial, governance, and operational issues.

One of the key issues is undercapitalization among distribution companies (Discos), which he estimated to be nearly N2 trillion.

He also noted that electricity tariffs should be rebased to reflect the actual costs and loss levels in the entire value chain and allow for adequate investment cost recovery.

Furthermore, the President stressed the need to extinguish historical sector debts to various stakeholders, calling for a reconciliation process to address these issues.

He also advocated for a reorganisation and recapitalization process that brings in new partners and fresh capital to enhance the performance of Discos.

The power sector remains a critical challenge for Nigeria, with millions of people lacking access to reliable electricity.

While privatisation was expected to improve the situation, it has fallen short of expectations, leaving many Nigerians reliant on expensive self-generation methods.

Addressing these issues and revitalising the sector is crucial for the country’s economic development and the well-being of its citizens.

Source: PUNCH