In March alone, Nigeria’s electricity grid has collapsed twice, resulting in a nationwide blackout. Among other factors, the regular collapse of the power grid is unconnected to poor utility performance, theft of grid equipment, weather, as well as insufficient funding.
According to a report by TheConversation, Nigeria’s national electricity grid has collapsed more than 200 times in the last nine years and in sub-Saharan Africa, every 1% increase in power outages (in terms of hours) has been associated with a 2.86% decrease in gross domestic product (GDP). This translates to a loss of about US$28 billion in GDP.
However, as part of efforts to resuscitate power generation and ensure even distribution of electricity across the country, the Nigerian Bulk Electricity Trading Plc (NBET) has approved and processed the sum of N9 billion from the Power Sector Reform Programme (PRSP) to all to power generation companies (GenCos).
The NBET also disclosed that it paid all GenCos the sum of N39 billion for power generated in January. This brings the total payments to GenCos in the last two months to over N80 billion.
“NBET paid N39 billion to GENCOs in first tranche of payments towards the settlement of January 2022 Payment Cycle. DisCos performance for same period is 51 per cent.
“Another N9 billion from the PRSP has been approved and processed by NBET as further payments to the GenCos”, it added.
According to the NBET, all GenCos are expected to also make similar payments to the gas suppliers. The NBET, incorporated on the 29th day of July 2010 and 100% owned by the Federal Government of Nigeria, is the manager and administrator of the electricity pool (‘The Pool’) in the Nigerian Electricity Supply Industry (NESI).
In an earlier report by Investors King, Financial Derivatives Company (FDC) Limited revealed that Nigeria will require about $100 billion in funding to solve its electricity supply challenges over the next 20 years, as investors are willing to actively participate in the power sector through partnerships, joint ventures, training of personnel and building of transmission and distribution infrastructure if only necessary reforms are put in place.
According to the report by FDC, of the estimated $100 billion in investment required to bridge the gap, renewable energy sources are likely to form the bulk of Nigeria’s energy solutions as global warming and climate change restrict investment in traditional energy sources.
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Sun Africa Commits $2.2 Billion to Transform Nigeria’s Power Sector
Sun Africa LLC, a global entity dedicated to supporting Africa’s energy needs, has announced a commitment of approximately $2.2 billion for the development of Nigeria’s power sector.
The pledge follows a meeting between the Minister of Power, Adebayo Adelabu, and representatives from Sun Africa, led by Chairman Goran Rajsic.
In the initial phase, the project will concentrate on delivering 961 MWp of solar PV infrastructure and 455 MWh of battery energy storage, marking a transformative venture valued at $2.2 billion.
This strategic collaboration aims to address Nigeria’s growing demand for new power infrastructure, aligning with the nation’s economic needs and transitioning toward sustainability.
Adelabu emphasized Nigeria’s significant requirement for new power infrastructure to support economic growth and sustainability.
The commitment from Sun Africa and its partners signifies a crucial step toward achieving Nigeria’s electricity goals.
Goran Rajsic expressed gratitude to the project partners, highlighting the support in designing a comprehensive solution featuring cutting-edge solar PV and battery storage technologies.
Sun Africa’s collaboration with Sterling & Wilson Renewable Energy Limited as its EPC partner represents a milestone in advancing sustainable and reliable energy solutions for Nigeria.
This initiative aligns with the nation’s commitment to driving positive change through innovative renewable energy solutions.
Niger Delta Power Holding Company Reveals N190bn Debt Owed by Government Entities
The Niger Delta Power Holding Company (NDPHC) has disclosed that the Central Bank of Nigeria (CBN), the Nigerian Bulk Electricity Trading Plc (NBET), and the Nigerian Electricity Liability Management Company owe a cumulative sum of N190 billion for electricity supply.
Chiedu Ugbo, the Managing Director and CEO of NDPHC, shared this information during a media briefing in Lagos.
Ugbo highlighted that the N190 billion debt has accumulated from 2015 to May 2023. While the exact amount owed by NBET wasn’t specified, Ugbo emphasized that the huge indebtedness to NDPHC runs into hundreds of billions, affecting the company’s operations and financial obligations.
He stated, “NDPHC is also not paid for availability but only as dispatched, thereby depriving NDPHC of hundreds of billions since 2015 when the Transitional Electricity Market was declared, and the government has so far been denied revenue as high as N3trn.”
Ugbo emphasized the challenging situation the debt has created, making it difficult for NDPHC to meet operational expenditures, pay gas suppliers, and maintain regular power generation.
To overcome these challenges, he called for urgent private capital mobilization and explored independent transmission projects, involving Gencos as investors.
Executive Director, Generation, Engr. Abdullahi Kassim, highlighted the ‘Light-up Nigeria Initiative,’ a program aimed at leveraging NDPHC’s generation assets to provide reliable power supply to eligible customers, distribution companies, and third-party project developers, ultimately achieving over 97% power distribution to the masses.
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