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Power System Collapsed Twice in April – Report

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Electricity - Investors King
  • Power System Collapsed Twice in April – Report

Nigeria’s power grid collapsed again on April 26, 2017, making it the second time the system crashed last month.

Figures from the Transmission Company of Nigeria showed that power generation dropped significantly last week from 3,222.5 megawatts on April 25 to 113.6MW the next day.

It was gathered that the most recent system collapse was due to frequency constraints on the grid.

This, according to industry sources, is despite the increased gas supply to the power plants following the stability in the Niger Delta.

Data from the National Control Centre for the power sector indicated that outages on two power lines and a transmission station contributed to the most recent collapse of the grid.

The NCC stated in a report, “The grid recorded a system collapse in the early hours of April 26, 2017 at 05:32 hours. System frequency dropped sharply from 50.91Hz to 47.52Hz, leading to the system collapse.

“Outages on Alaoji/Ikot-Ekpene 330kV lines 1 & 2 at the Ikot-Ekpene transmission station and Onitsha/Alaoji 330kV line (cct T4A) meant that Afam VI and Alaoji NIPP were unable to evacuate to the grid, negatively impacting grid stability.”

The national power grid witnessed the first collapse on April 9, a development that resulted in the drop in generation from over 3,000MW to just 108.7MW.

Industry data showed that power generation plunged from 3,069.5MW on April 8, 2017 to 108.7MW on April 9, and moved up marginally to 240MW the next day.

It was learnt that heavy rainfall at three transmission stations led to load reduction that prompted high frequency in the system, a development that triggered the collapse of the electricity grid.

The April 9 collapse was the first to be recorded in the second quarter of this year.

An exclusive report revealed that the country’s electricity grid collapsed 10 times in the first quarter of this year.

Officials at the Transmission Company of Nigeria stated that the April 9 system collapse was caused by heavy rainfall that affected the Onitsha, Benin and Alaoji transmission stations, leading to a cumulative load reduction of 384MW in the affected areas.

The NCC, in its report on the incident, stated, “There was heavy rainfall reported from Onitsha T/S, Benin T/S and Alaoji T/S, which led to area load reduction from 70MW to 15MW, 100MW to 20MW and 300MW to 51MW, respectively.”

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Economy

Nigeria’s Plan to Review Oil Companies’ Gas Flaring Strategies

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Oil

Nigeria is ramping up its efforts to address environmental concerns in the oil and gas sector with a comprehensive plan to review gas flaring strategies of international and indigenous oil companies.

The Minister of State for Environment, Dr. Iziaq Salako, announced this initiative during a national stakeholders engagement meeting on methane mitigation and reduction held in Abuja, Investors King reports.

Gas flaring, a common practice in the oil industry, releases methane—a potent greenhouse gas—into the atmosphere, contributing to climate change and posing health risks to communities near oil facilities.

Nigeria aims to end routine gas flaring by 2030, aligning with global climate goals and commitments.

Dr. Salako explained the importance of reducing methane emissions and highlighted the detrimental effects on public health, food security, and economic development.

He outlined practical steps being taken to tackle methane emissions, including the development of methane guidelines and the engagement of government institutions.

The ministry, through the National Oil Spill Detection and Response Agency, will conduct periodic reviews of oil companies’ plans to ensure compliance with the gas flaring deadline.

Deloitte management consultants will assist in conducting comprehensive forensic audits to scrutinize the legitimacy of forward-contracted transactions.

President Bola Tinubu’s commitment to environmental sustainability underscores the government’s dedication to addressing climate change and fulfilling its multilateral environmental agreements.

The engagement event served as a platform for stakeholders to discuss methane mitigation strategies, existing policies, and implementation challenges.

Collaboration and dialogue among diverse sectors are crucial in charting a unified course towards sustainable methane reduction in Nigeria’s oil and gas industry.

As the country navigates its environmental agenda, ensuring accountability and transparency in gas flaring practices remains paramount for achieving a greener and healthier future.

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Economy

Interest Rate Jumps to 24.75% as CBN Takes Aggressive Stance Against Inflation

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Dr. Olayemi Michael Cardoso

The Central Bank of Nigeria (CBN) has announced a significant increase in the monetary policy rate, known as the interest rate, to 24.75%.

This move disclosed by CBN Governor Olayemi Cardoso during the 294th Meeting of the Monetary Policy Committee press briefing in Abuja, represents a bold step by the apex bank to address the mounting inflationary pressures faced by the country.

With inflation soaring to 31.70% in February, the CBN aims to moderate this upward trend by tightening its monetary policy stance.

This decision follows the previous hike in the interest rate to 22.75% in February, showcasing the CBN’s commitment to combatting inflationary forces.

While the bank opted to maintain the Cash Reserve Ratio at 45%, the significant increase in the interest rate underscores the urgency of the situation and the need for decisive action.

Governor Cardoso emphasized that these measures are essential to stabilize the economy and safeguard the purchasing power of the Nigerian currency.

The 294th MPC marks the second meeting under Governor Cardoso’s leadership, indicating a proactive approach to addressing economic challenges.

The next MPC meeting is scheduled for May 20th and 21st, 2024, highlighting the ongoing commitment of the CBN to navigate Nigeria’s economic landscape amidst inflationary pressures.

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Economy

Nigeria Braces for 10th Consecutive Interest Rate Hike by Central Bank

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Central Bank of Nigeria (CBN)

As Nigeria grapples with persistently high inflation, the Central Bank of Nigeria (CBN) is gearing up to implement its tenth consecutive interest rate hike in a bid to curb the soaring prices and attract investment.

Analysts surveyed by Bloomberg are anticipating a substantial 125 basis-point increase in the key rate to 24%, marking one of the most significant adjustments in the current tightening cycle.

The decision, expected to be announced by Governor Olayemi Cardoso on Tuesday at 2 p.m. in Abuja, comes on the heels of inflation accelerating to 31.7% in February, far surpassing the central bank’s target range of 9%.

This surge has been primarily attributed to the sharp depreciation of the naira, prompting authorities to devalue the currency twice since June to narrow the gap with the unofficial market rate and encourage investor confidence.

While these measures have seen the naira strengthen in recent days and bolstered investment inflows, including a fourfold increase in overseas remittances and significant foreign investor portfolio asset purchases, there remains a palpable need for more decisive action.

Giulia Pellegrini, a senior portfolio manager at Allianz Global Investors, emphasized the necessity for the CBN to intensify its tightening efforts to regain foreign investors’ confidence in the local bond market.

While acknowledging the positive strides made by the central bank, Pellegrini stressed the importance of a more assertive approach to prevent the diversion of investor attention to other frontier markets.

As the Nigerian economy navigates through these challenging times, the impending interest rate hike signals the CBN’s determination to address inflation head-on and foster a more stable economic environment.

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