The Nigerian Economic Summit Group (NESG) has recommended a review of the privatisation of the power sector.Minister of State for Budget and National Planning, Zainab Ahmed, disclosed this at the end of summit yesterday that the Federal Government would raise a committee to implement the recommendations.
The summit, which also recommended a review of electricity tariff, said it was necessary to make the sector attractive to investors, just like the telecommunications sector.
The NESG added that the proposal would ensure the attainment and the optimisation of the summit’s theme “Opportunities, productivity and employment, actualising the economic recovery and growth plan (ERGP)
Ahmed explained that a review of the electricity tariff would increase the sector to what investors refer to as cost recovery level to attract investments.She added that a review was needed in the distribution sub-sector, because it had remained epileptic due to inadequate injection of capital by the current concessionaire.
According to her, the poor funding has made it difficult for effective metering and other infrastructure to enhance delivery and supply of power and to boost productivity and wealth creation in the country.The minister disclosed that the review would begin with the Electricity Distribution Companies (DISCOs), which has been noticed to be problematic.She said: “The recommendations would require the stakeholders coming together to agree on what stake they would give off to the new investors.
“As you are aware, we have not had investors in the petroleum sector for almost seven years because of the non-passage of the Petroleum Industry Bill (PIB), because investors feel that the prices are not cost reflective enough.’’
Among other recommendations is the removal of all regulations stifling the development of off-grid electricity solutions, to encourage the use of renewable energy and increase electricity access and reduce poverty
The NESG urged also canvassed the promotion of willing buyer and seller agreements for gas without government interventions on prices, and acceleration of investment in gas and renewable energy by providing fiscal incentives like 10 years or more tax holiday.
Meanwhile, the immediate past President of the Federation of African Engineering Organisations (FAEO), Mustapha Musa has explained the cause of power outage.
According to him, the inability of the DISCO’s to remit money collected to Market Operators (MO) and Nigeria Bulk Electricity Trading (NBET) is hindering stable power supply in the country.
He stated this in Abuja yesterday while speaking at a lecture with the theme “Energy Situation In Africa: Opportunities and Challenges” at the 26th Nigerian Society of Engineers (NSE).
He added that the failure of Generating Companies (GENCOs) to pay for fuel have denied suppliers the needed funds to maintain their plants.He added that the failure of GENCO’s to pay for fuel denied the suppliers the needed funds to maintain their plants and expand their networks adding that most of the operators have delinquent credit exposures to banks.