FG Shifts Focus to Address Distribution Challenges for Better Power Supply
The Nigerian government is shifting its priorities in the energy sector to address the distribution segment of the Nigerian Electricity Supply Industry (NESI) as part of efforts to enhance power supply to homes and businesses.
With over 13,000 megawatts of installed power generation capacity and 7,100 MW of transmission capacity, the focus is now on improving the distribution aspect.
The Minister of Power, Chief Adebayo Adelabu, revealed this during an interactive session with journalists in Abuja. He emphasised the need to bridge the $7 million metering gap in the industry to boost liquidity.
In the past, the power supply issue in Nigeria had largely focused on generation and transmission challenges.
However, with this new approach, the government aims to tackle the distribution segment, which plays a crucial role in ensuring that generated power reaches consumers efficiently.
Chief Adelabu highlighted the importance of metering and how it is a fundamental aspect of power distribution.
Metering allows for accurate measurement of power usage, proper billing, and effective revenue collection.
The policy change includes a comprehensive review of the structure of electricity distribution companies, considering aspects such as franchise area size, capitalization, and the duration of licences.
The minister stressed that there is no point in having a significant generation capacity without the ability to deliver improved power to consumers.
The goal is to start from the customer’s end, addressing issues such as metering, which is vital for accurate billing and revenue collection.
Chief Adelabu acknowledged that the industry also needs to combat power theft and vandalism of power infrastructure, indicating that those involved in such activities will face legal consequences.
Adelabu expressed his opinion that privatization was not the ideal approach taken by the government in 2013, suggesting that commercialization could have been more beneficial, attracting greater investment and performance.
The government is currently examining the process used by the Nigerian Electricity Regulatory Commission (NERC) to extend the operational licenses of distribution companies.
While addressing tariffs, Adelabu mentioned that the government continues to provide support and subsidies to the sector.
Removing subsidies would result in a significant increase in electricity tariffs, nearly doubling them to around N130 per kilowatt-hour.
Additionally, the minister shared that the 700 MW Zungeru Hydro project in Niger State is almost ready and is expected to become operational before the end of November.
This development will contribute to the nation’s power generation capacity.
In summary, the Nigerian government is shifting its focus towards improving the distribution segment of the electricity supply industry to enhance power supply and address issues such as metering and revenue collection.
Source: Vanguard
