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Eight Firms to Light up Ogun With $497.6m Power Plants

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  • Eight Firms to Light up Ogun With $497.6m Power Plants

The issue of epileptic power supply to Ogun State may soon be over if the Light-up Ogun initiative by the state government and eight independent power producers succeeds.

On Tuesday, the state government and the eight firms signed the Memoranda of Understanding that signalled the commencement of the $497.6m projects in different locations in the three senatorial districts of the state.

According to the Secretary to the State Government, Taiwo Adeoluwa, the government will not commit any resources into the projects except the land, which will form its equity contribution, while the power producers and their technical partners will raise the funds to build the plants.

The Light-up Ogun project is the brainchild of Governor Ibikunle Amosun, who is concerned about the challenges of epileptic supply of power to the indigenes and residents.

Adeoluwa stated, “Ogun State hosts the largest number of major industrial companies in Nigeria; small and medium-scale forms the major entrepreneurship platform the state is known for. Both the domestic and industrial players in the state receive little or no power from the national grid.

“Today, most industrial companies operating in Ogun State generate individual power to run their respective businesses. Small and Medium Enterprises that could not finance their independent power folded up, leading to massive unemployment and youth restiveness all over the country, making most of the companies not competitive in the international market. This position is not acceptable to the governor and this informed the Light-up Ogun project.”

Taking advantage of the full liberalisation of the power sector by the Federal Government, the state government invited bids from independent power producers interested in generating off-grid and embedded electricity of between one and 20 megawatts.

Twelve power producers submitted bids and after careful evaluation by the Ogun energy team, eight of them were selected and given specific areas of the state to set up clean energy plants and light up.

Under the Light-up Ogun project, the government is aiming to light up the state by bringing efficient and uninterrupted power supply to strategic areas of the three senatorial districts of the state, with the facilities coming with a metering system.

The project is to concentrate on industrial locations where independent power plants will introduce possible embedded facility to most industries within the areas to serve mostly government hospitals, health centres, police stations and educational establishments.

Earl Grey Nigeria Limited is to generate eight megawatts of electricity using natural gas, with the $25m plant to be located in Ogijo.

The Managing Director, Earl Grey Nigeria Limited, Jumade Adejola, said, “We are here today because the governor has said he wants the whole of Ogun State to be lighted up. Come next year, we would have achieved it.

“We will be covering Ogijo, Shimawa and other areas in the axis. We will be using gas to generate electricity. The plant will be built by professionals to ensure that residents are protected from gas hazards. It will be a very safe and secure site.

“We are talking with the state government as regards the pricing, but we can assure you that the prices will be quite affordable.”

According to the Managing Director, Gateway Solar Power International Nigeria Limited, Anthonio Ojurabesa, its $200m solar plant in Agbara will generate 125MW of electricity and will serve the many industries in the area as well as residential customers. Naanovo Energy Nigeria Limited is expected to generate five megawatts of electricity from household wastes in the Adigbe area of Abeokuta, the state capital

The firm said that cinder blocks would be made from the ashes from the burnt waste, in addition to potable water.

The company’s Group Managing Director, Ben Alabi, stated, “We are into converting waste to energy through combustion for the Adigbe area and the environs. We have carried out the analysis and we are confident that seven megawatts will cater for the whole of the area. The waste to energy plant that we are building in Ogun State will be the first of its kind in the whole of Africa, because to the best of my knowledge, there is no such plant in Africa.

“We are financing the project with external sources because it costs about $50m in total.”

To power the machinery of government at the Oke-Mosan Secretariat Complex, Nikenando Energy Limited is to generate between 5MW and 20MW through Joule Box hybrid generator at a cost of $46.2m.

Renaissance Impex Energy will expend $56m on a 48MW solar plant that will serve Ikenne, Ago-Iwoye and the Ewekoro Model School, with firm’s co-partner, Tunde Ogundeko, explaining that funds would be sought from the Bank of Industry and its partners abroad.

The Managing Director, Sholep Energy, Olalekan Sogbesan, explained that the firm would be supplying five megawatts of electricity to the Ogun State Polytechnic, Ipokia and neighbouring communities from solar source and that it would spend $10m on the plant.

Solonic Energy will generate 100MW from solar and supply it to the entire Ilaro area of the state, with the Chairman of the firm, Olu Adedoyin, explaining that technical partners from Germany would help to set up the $100m plant.

The federal airport in Wasimi as well as Ewekoro area will benefit from the five megawatts solar plant to be built by Tido Tech International, with the Chief Executive Officer, Prof. Olugbemiga Olatidoye, explaining that the capacity would be scaled up to about 175MW later.

While giving approval for the project, the Deputy Managing Director, Ibadan Electricity Distribution Company, John Ayodele, said, “We support the efforts of the government to light up the state. It is part of our vision to seek help and for Ogun State to start this project, they have our 100 per cent support. We are ready to partner within the confines of the law of the Federal Republic of Nigeria.

“We will not be left behind and we will do anything to support the government in this decision. We need this service more than any other person.”

The Commissioner for Justice and Attorney General of the state, Dr. Olumide Ayeni, stated that the state government had allocated two acres of land to each of the power producers as its equity contribution.

“Every IPP should familiarise themselves with the laws on energy generation and distribution in Nigeria such as the Electric Power Sector Reform Act, 2005 and the Eligible Customer Relations Regulations, 2017,” he added.

The representative of Momas Electricity Meter Manufacturing Company Limited said the firm was happy with the project and would provide accurate metering of energy supplied by the IPPs.

The Consultant to the Governor on Energy and Team Lead, Ogun Energy, Chief Akinsanya Fagbemi, told the IPPs that the government would not hesitate to review the agreements if after three months they failed to begin work at the various sites, adding that the Power Purchase Agreement and other details would be finalised in the weeks ahead.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Economy

Lagos Loses N1 Trillion to #EndSARS Protest, a Year Budget – Gov

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Lagos Needs N1 Trillion to Fix Vandalised Infrastructure, a Year Budget – Gov

The Governor of Lagos State, Babajide Sanwo-Olu, has puts the total economic cost of past week destruction and vandalism in the state at about N1 trillion.

Sanwo-olu, who spoke with the speaker of the House of Representatives, Hon. Femi Gbajabiamila, that was on a fact-finding visit to Lagos on Sunday, said the state may spend up to N1 trillion to fix damages done to infrastructure.

Speaking on the situation, Femi Gbajabiamila, said “The House of Representatives will do all it can to compensate all those who suffered brutality including policemen that lost their lives in the process.

“Also whatever the house can do in rebuilding Lagos and other states it will do. We are now in a state of reconstruction. What must be done will be done.

“I learnt from the governor of Lagos State that it will take N1.0 trillion to rebuild what had been lost and I asked him what is the budget size of the state he said about N1.0 trillion. You can see we are moving backward.

Rotimi Akeredolu, Chairman of the South West Governors, who was part of the visit, stated, “We are indeed surprised at the extent of damage to lives and properties in Lagos. We will be right to say Lagos was turned into a war zone.

“We are deeply concerned with the ease with which public buildings, utilities, police stations and investments of our people have been burnt despite the proximity of security agencies to those areas. However, while responding to the total number of government’s buildings burnt among others,” Lagos State Commissioner for Information and Strategy, Mr Gbenga Omotoso, stated.

We are still counting. The state is still taking inventories of all that happened and not until all that is concluded we can’t not ascertained for now the total number of burnt structures. But I can tell you it’s very huge.

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Economy

Experts Recount Nigeria Losses Ahead Possible Rebuilding, Recovery

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Economic Experts Recount Losses Incurred from the #EndSARS Protest Ahead Possible Rebuilding, Recovery

Economic experts have started releasing reports on the size of the damage done to the nation’s economy following the #EndSARS protest that was hijacked by hoodlums and criminals.

The most affected state, Lagos State, will need about $1 trillion, an equivalent to its annual budget, to recoup the economic value of what was lost to the destruction and looting perpetrated by thieves masquerading as protesters.

A Senior Economist/Head, Research & Strategy, Greenwich Merchant Bank, Ayodeji Ebu, said the unrest and the 24 hours curfew that was later imposed by Lagos State to restore order could cost the state at least N54 billion per day.

He explained that the protest would hurt the nation’s foreign direct investment in the remaining part of the year and as well as the first quarter of 2021.

His words: “While it may be difficult to estimate the exact loss so far, based on the significant contribution of Lagos State (approximately 30%) to Nigeria’s total Gross Domestic Product (GDP) and as over 50 percent of Nigeria’s non-oil industrial capacity is located in Lagos, the impact of the crisis will be enormous.

“This was further compounded with the 24hours curfew that lasted for about four days. Estimating using the Q2’2020 GDP data and assuming there was a total shut down, each day will cost Lagos alone about N54 billon.

Speaking further, Ebu said: “With Lagos the centre of the civil unrest, which account for 70 percent or $1.1 billion of total capital importation in Q2’2020, we expect this to further impact on direct investment in Q4’2020 and Q1’2021.

He expects that insurance claims to also rise in line with the damages done on lives and properties.

Similarly, analysts at Cordros Capital, a Lagos based investment banking firm, reacted to the negative impact of the unrest on the nation’s economy.

The analysts said the nation’s economy could contract by as much as 6.91 percent year-on-year in the final quarter of the year due to the unrest. Therefore, they projected a negative growth rate of 4.15 percent year-on-year for the 2020 fiscal year.

In their words, they said “The transportation, trade, and manufacturing sectors are expected to be the hardest hit.

“On transportation, we expect reduced domestic and international flight operations pending when normalcy is restored.

“Similarly, we expect compliance with curfew directives to hinder the free movement of people and goods across the country, further compounding the woes of the transport sector, which is yet to recover from the COVID-19 induced decline.

“While the manufacturing sector is currently being hampered by FX related issues and an unfriendly business environment, the imposition of curfews will further exacerbate the challenges of the sector.

“For the trade sector, the decline in household consumption brought about by higher food prices and shrinking consumers’ income will cascade into weak wholesale and retail trade in conjunction with the pre-existing supply chain constraints.”

Analysts at Fidelity Securities Limited also added their voices and said the protest may cost the nation more than the N700 billion estimation previously estimated by the Lagos Chamber of Commerce.

They said “The EndSARs protest and eventual escalation of the protest would cost the Nigerian economy way more than N700 billion initially estimated by the Lagos Chamber of Commerce. With the current level of destructions, it may take a while for business to run at full capacity as the government as well as the private sector will first have to channel funding into the destroyed infrastructure in a bid to restore things back to the way it was, before even thinking of further improving on the infrastructure.

“Given the level of destruction, more businesses have been affected, more jobs would be lost, and more families would further fall below the poverty line as a result of the looting and burning of business. This is expected to further worsen the economic situation of the country which was already suffering from the impact of Covid-19. The government at this point would need to think out of the box, if it aims to revitalise the economy in the shortest time, else our GDP growth rate may remain negative even into the new year.

Accordingly, the Electricity Distribution Companies of Nigeria (DISCOs), on Sunday said the destruction of equipment it uses to deliver power and service operations will hurt its revenue generation and service delivery in October and the rest of the fourth quarter.

The DISCOs said “I tell you, assets are been destroyed, which is a significant impact on the industry. The DISCOs are expected to give power and how will it be achieved when our facilities including cables, poles, buildings are destroyed.

“That, however, transcends to money because the DISCOs cannot collect money for bills due to the unrest. Who would want to pay when everybody is angry.

“This means the remittance will be low to the Government on power we have collected. The protest has empowered Nigerians to fight back and the threat to lynch officials collecting bill are high. The properties and cables would have to be fixed on whose account?

“Seriously we are at a crossroad but we have signed an agreement to deliver power and that we would do.”

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Economy

Nigeria Mulls Selling Electricity to Republic of Chad

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Nigeria Considers Selling Electricity to the Republic of Chad

The Federal Government is presently considering selling electricity to the Republic of Chad after a request was made by the neigbouring nation.

The federal government-owned Transmission Company of Nigeria disclosed this on Sunday, adding that a meeting was held last week to discuss the possibilities of plugging the Republic of Chad to the nation’s grid.

Nigeria presently exports electricity to three neighbouring nations, Benin, Togo and the Republic of Niger despite struggling with power supply at home and failed to up its power generation more than the current level of 3,000 -4,500 megawatts in recent years.

On Sunday, the total power generated declined to 3,474.5MW as of 6am, down from 3,776.5MW on Saturday, according to the latest data from the Nigerian Electricity System Operator.

The total number of idle plants rose from 8 on Saturday to 11 on Sunday. These idle plants were Geregu II, Sapele II, Alaoji, Olorunsogo II, Omotosho II, Ihovbor, Gbarain, Ibom Power, AES, ASCO and Trans-Amadi.

A total of twenty-seven plants were presently connected to the national grid, which is being managed by the TCN.

Meeting between Ministry of Power, TCN, and the Chadian Minister of Energy, Mrs Ramatou Mahamat Houtouin, to discuss the possibilities of connecting the Republic of Chad to the Nigerian national grid [was held] on Wednesday, October 21, 2020,” the TCN said on its Twitter handle on Sunday, alongside pictures of the meeting.

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