A NATION IN DARKNESS: ACCELERATING POWER SECTOR REFORMS BY KAYODE OLUWA Recently, the World Bank released a report which

revealed that Nigerias electricity supply is the lowest among member countries of the Organization of Petroleum Exporting Countries (OPEC). Albeit, this is a shame to the so called giant of Africa, it should not come as a surprise to Nigerians, considering the current parlous state of power infrastructure and persistent epileptic electricity supply in Country. According to the World Bank report {The Punch, April 18, 2012} Nigeria has the lowest electricity consumption per capita at 123.76 per kilowatt hour, among the eleven members of OPEC. The countrys electricity generation per capita of 0.000021 megawatts is also the lowest among member-countries. The World Bank data indicated that Nigerias electricity consumption per capita or unit of the population (123.76KWH) is far lower than that of Algeria (809.83KWH), Angola (237.880KWH), Ecuador (1,053.48KWH), Iran (2,653.7KWH), Kuwait (15,491.43KWH), Libya (3,360.13KWH), Qatar (16,190.73KWH), Saudi Arabia (6,318KWH), the United Arab Emirates (12,814.97KWH) and Venezuela (3,004.08KWH). The World Bank statistics show that Algeria has a per capita electricity generation of 0.000329MW, Angola; 0.000378MW, Ecuador; 0.001217MW, Iran; 0.00081MW, Kuwait; 0.002636MW, Libya; 0.001658MW, Qatar; 0.001106MW, Saudi Arabia; 0.005305MW, UAE; 0.002268MW, and Venezuela; 0.00079MW. Nigeria, despite being a major crude oil producer among the OPEC members and having the highest population estimated at 167 million people, generates the lowest volume of electricity at around 3,500MW on the average. Algeria generates 12,000MW for a population of 36,423,000; Angola, 7,000MW for 18,498,000 people; Ecuador, 18,260MW for 15,007,343 people; Iran, 61,000MW for 75,330,000 people; Kuwait, 9,400MW for 3,566,473 people; Libya, 9,400MWfor 5,670,688 people; Qatar, 9,000MW for 1,696,563 people; Saudi Arabia, 30,000MW for 27,136,997 people; U.A.E, 18,747MW for 8,264,070 people; and Venezuela, 23,000mw for 29,105,632 people. The poor state of electricity supply in Nigeria constitutes a formidable challenge and major obstacle to economic growth and development of the country. This is particularly so, in the quest to make Nigeria a preferred investment destination by ensuring an enabling environment for business to thrive. While all sectors of the economy are adversely affected by the inefficient electricity supply, the hardest hit are small scale businesses, industrial/ manufacturing companies, telecoms companies, hospitals and,

indeed, all segments of the society, including house holds. In view of the lingering uncertainties and topsy-turvy situation in the power sector, Nigerians seem to have given up hope on steady and reliable power supply in the near future. Consequently, companies, organizations and individuals have devised ways and means of coping with the untoward swings in electricity supply, in order to meet their energy needs, sustain their businesses and survive the harsh, torrid conditions. The quest to adopt alternative means of energy, however, has inherent cost implications. For businesses, they have had to resort to generating sets for power supply with attendant enormous operational costs, due to the prohibitive cost of diesel to run the generators. Concomitantly, the cost of production /doing business has gone up astronomically, apparently owing to the amount industrial and business concerns spend on generating power. In fact, generator has become the main source of power supply to many homes and businesses, while PHCN supply is now the stand-by! Apart from its economic implications, poor power supply also have implicit security implications, as social miscreants and unscrupulous elements in the society tend to perpetrate all sorts of crimes, criminalities and other nefarious activities under the cover of darkness. The power situation has badly deteriorated , in recent months, as power generation from the national grid has dropped significantly by about 1,000MW, from the 4,000MW sometime ago, to between 3,000 and 3,500MW presently, with resultant frequent power outages. The recent near collapse of electricity system in the country has been attributed to shortage of gas, as well as equipment failure at the plants. Most thermal stations were reportedly working below capacity, due to low gas supply and faulty generation units. If the recent statement by the minister of power, Prof. Bart Nnaji, is anything to go by, then the poor state of power generation and supply in the country is likely to get worse due to gas supply challenges. We are having serious gas supply challenges the minister was quoted to have said recently. In order to improve power infrastructure and achieve adequate and effective electricity supply in the country, it has become imperative for government to speed up the power sector reforms which constitute one of the major pillars of its transformation agenda. The government must endeavor to achieve a minimum power generation of 6,000MW by the end of 2013 and a minimum of 10,000MW by 2015, with the ultimate aim of achieving a minimum of 40,000MW and above, by the year 2020. A tall and ambitious dream? Yes, but it is attainable and achievable, if only the government can show more commitment, determination, consistency and political will in driving the power reforms to the logical conclusion. It is, however, regrettable to note that the power reforms have been running behind schedule and seem to have been stalled, castrated and frustrated by entrenched vested interests, including businessmen, generator merchants, government/

PHCN officials/civil servants, as well as politicians and others who are benefitting from the status quo. In a bid to weed out incompetence, corruption and mediocrity endemic in the power sector and to give fresh momentum to the power reforms, the Power Holding Company of Nigeria (PHCN) has been unbundled and re-organized, in terms of structure and operations, with the establishment of eighteen (18) successor companies. The reorganization has also led, and should lead to more, re-adjustments of personnel in PHCN, in order to ensure efficient management and enhanced productivity. It is also encouraging that, as part of the ongoing power reforms to ensure significant investments in the power sector, the federal government has approached, and obtained a credit line from the International Development Association (IDA), an arm of the World Bank, towards the cost/ funding of the Nigeria Electricity and Gas Improvement Project (NEGIP). The project is for the conversion of Low Voltage Distribution System (LVDS) to High Voltage Distribution System (HVDS) in five electricity Distribution companies which are sliced into five (5) lots. The five lots include injection substations in Kano, Kaduna, Benin, Enugu and Port Harcourt. It is believed that these projects, when completed, will significantly impact positively on electricity supply in the country. Another serious challenge and big threat to the power reforms and efforts at ensuring improved power supply is the continuous vandalism of power equipment and facilities which has the proclivity to jeopardize the enormous investments already made in the power sector. There is, therefore, the need for urgent and effective measures to be taken by the government to check this untoward trend, in order not to cripple the power sector, in the face of increasing damage being done to power infrastructure in the country. The issue of prepaid meter should also be addressed to ensure sufficient availability and supply of the meters to all consumers for enhanced billings, efficiency and productivity in electricity distribution and supply. All said, the government needs to properly manage and effectively address the unresolved issues in the power sector- especially as they relate to the privatization of the PHCN and its successor companies in concert with all stakeholders, including the Workers unions, in order to ensure a hitch-free and successful completion of the power reform programme. Going forward, the government should vigorously pursue, intensify and accelerate the power sector reforms, in order to ensure efficient, adequate, reliable and constant power supply to stimulate and enhance economic recovery, growth and development of the country.

OLUWA, a Business Economist and Consultant, wrote in from The Executive Business School, Lagos, Via oluwa95@yahoo.com. 08033233844.