Power sector on the move

BY UCHE ANEKE
Recently  a major milestone was recorded in the Nigeria’s power sector with the  formal  handover ceremony of share Certificates and licenses to Purchasers of the  successor companies of  Power Holding Company of Nigeria ( PHCN).  Nine Distribution and five.
Generation Companies were handed over to the new owners of the Company by President Goodluck Jonathan. This event is significant in many respects. It marks a major step in the effort of Government to provide  adequate power supply through a private sector-driven industry. It also heralds government’s direct disengagement from the management of these Generation and Distribution Companies.
It has also finally closed the chapter of doubts as to whether privatization of the sector will succeed. This is particularly remarkable against the back drop of strong cynicism that greeted the privatization efforts of the Federal Government at the initial stage.
Many people did not believe that privatization of the power sector would be successful. Today privatization has become a reality; a strong indication of investors- confidence in Nigeria’s power sector.
There is already excitement and great expectations among Nigerians on the expected gains of this new dawn in the on-going reform of the Power Sector. It is the    belief of some people that the takeover of the nation’s generation and distribution companies would lead to efficiency in power supply.
It is also expected that the process will ensure competiveness and best practices in the country’s electricity sector. President Jonathan captured the mood of the nation in his speech at the event as a day of hope, a day of promise and a new beginning for one of the most vital sectors of the national economy.
He stated that it is a new journey, a journey that will usher the nation to a destination of enduring gain and fulfilment. This hope must not be dashed as past efforts to revamp and revitalize the power sector in the country yielded little or no tangible result.
This underscores the launch of power sector Road Map, by President Goodluck Jonathan in August 2013, the policy thrust is aimed at addressing the failure of the past administrations to achieve a substantial increase in the total quantum of power delivered to electricity consumers across the country and to ensure substantial reduction in government’s funding and managerial direction of significant elements in the electricity value chain.
This dogged step and the political will of the President obviously brought about remarkable progress in the administration’s Privatization efforts. As part of the reform, the Nigerian Electricity Supply industry has been transformed into a well-structured and regulated   environment through the creation of the Nigerian Electricity Regulatory Commission (NERC) and its reconstituted Board.
In line with the power reform road map, the Nigeria Electricity Liability Management Company Ltd (NELMCO) has been incorporated and is now fully operational.
Similarly and in recognition to provide investors with the enabling environment for their resources, the Nigerian Bulk Electricity Trading, PLC (NBET) has also been put in place. This is also to provide the securitization that is key to driving power production efforts.
The government has positioned NBET to carry out its mandate without financial constraints by capitalizing it to the tune of over $750 million dollars. The Electricity Management Services was also established recently to provide ancillary and support services to the Nigerian Electricity Supply Industry.
In addition, a management contract is now in place for the Transmission Company of Nigeria (TCN) to bring global best practice in the expansion and the management of the nation’s transmission grid. The TCN Board has also been inaugurated and the Schedule of Delegated Authority (SODA) has been issued to Manitoba Hydro of Canada
Despite these remarkable achievements, there is however a number of challenges which must be addressed quickly in order to sustain the momentum of the successes recorded in the sector.
The first challenge is to ensure the payment of all labour –related benefits as promised electricity workers by the Minister of Power Professor Chinedu Nebo. Already there are concerns within the sector over the non- completion of the payment of these benefits prior to  handover of the Companies.
It is gratifying however to note that government has assured the sector workers that  every kobo owed to them will be paid  before physical takeover of assets by the new owners.  Another challenge is that of ensuring that adequate infrastructure is put in place by the new owners for a sustained increase in national power generation capacity. These task are certainly capital intensive.
The good news is that the new owners have assured the nation of their untiring commitment and financial strength to address the inadequacies in the generation and distribution infrastructure.
While we commend President Jonathan’s administration for this milestone in the journey to power sector privatization, it is also worthwhile to appreciate the efforts of the National Council on Privatization (NCP), the Bureau of Public Enterprises (BPE) and other key stake holders to reform and liberalize the country’s electricity industry. It is hoped that better days in power supply await Nigerians and can only get better with the new owners at the helm of affairs
■ Aneke writes from Abuja.