Politics

Osinbajo confirms FG’s plan to open power market to new investors

Vice President Yemi Osinbajo

Vice President Yemi Osinbajo has revealed that the Federal Government is creating an open market for new power investors.

Osinbajo noted that creating policies that will open up Nigeria’s electricity market to new investors would help resolve the power supply problem.

According to the VP, the President Muhammadu Buhari’s administration top priority is to provide reliable power supply by bringing in new investors in generation, transmission and distribution.

Naija Buzz News in our Thursday Newspaper Headlines Review, had reported that the Federal Government was planning to take over 10 electricity distribution firms. The FG described the investors in these firms as failed investors.  

Osinbajo in his statement revealed that the current power structure could not deliver on the government’s promises for power, consequently, a substantial change of strategy is being pursued.

“Today we have 13,427MW of installed capacity, and an available capacity of 8,342MW. The national grid has the capacity to transmit about 7,000M, an increase from less than about 5,000MW in 2015,” Osinbajo stated on Thursday while inaugurating the 2x60MVA, 132/33kV substation built by Niger Delta Power Hold Company Limited at Abeokuta, Ogun State.

“But distribution capacity in the 11 Discos are significantly low, hovering at around 4,000MW on average with a peak of about 5,400MW. So despite the availability of about 8,000MW of generation and about 7,000MW of transmission capacity, lack of Disco infrastructure to absorb and deliver grid power to end users has largely restricted generation to an average of about 4,000MW,” he added.

Osinbajo further noted that the FG’s plan is the Nigeria Electrification Road map which is designed to achieve 25,000MW of electricity by 2025. The FG had few weeks ago signed a Letter of Agreement on the Nigeria Electrification Road map with German Government and Siemens.

The next plan according to Osinbajo is; “the opening up of the market to new investors in generation, transmission and distribution infrastructure, transacting directly with each other to serve willing customers including deploying off-grid power and using micro-grids, especially for deployment of solar power.”

“The Electricity Distribution Franchising Regulation, which is still in public consultation preparatory to its issuance within a short period of time, sets out the rules for a distribution company to appoint or be compelled to cede consumers connected to a 33kV or 11kV feeder or a designated area to an agent or third party willing to make investments in lines, metering, transformers, other equipment and operations to serve the customers better at a mutually agreed tariff.”

Speaking about the new power substation, Vice President Osinbajo described it as an important part of the FG’s efforts to improve power supply to homes and businesses of Nigerians.

Osinbajo further revealed that before the end of 2019, new generation is expected from Gbarain (extra 115MW), Kashimbilla (40MW), Afam III Fast Power (240 MW); Gurara (30 MW); Dadin Kowa (29 MW); and Kaduna (215 MW).

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