All assets Power Ministry used to control for power were sold by last Administration, blame operating companies for poor supply – FG

•Urges consumers to complain to companies

•We’ve made major progress in power sector —GENCOs

•DisCoskeep mum over their failures

“There are problems without a doubt and wemust deal with them. But let me remind you, all of the assets that the Ministryof Power used to control for power have been sold by the last administration beforeI came. And so, if you don’t have power, it is not the government’s problem.Let us be honest.”

The Federal Government, on Thursday, toldNigerians not to blame it for the poor electricity supply across the country.

The Federal Government, on Thursday, toldNigerians not to blame it for the poor electricity supply across the country.

Minister of Works, Power and Housing, Mr. Babatunde Fashola (SAN), who spoke at a stakeholders meeting in Abuja, Wednesday night, however, advised electricity consumers in the country to direct their complaints about poor power supply and faulty equipment to electricity Distribution Companies, DISCOs and Generation Companies, GENCOs.

Meanwhile, the Generation Companies (GenCos) have reacted to the Minister’s claims, arguing that they had made major progressdespite challenges in the power sector.

The GenCos have been able to explain their own side as power generation companies while, till the time of filing this report, the companies charged mainly with the business of making the generated power available to citizens in the country, the Distribution Companies (DisCos) have uttered no word.

Fashola explained that the Federal Government could no longer interfere in the issue of citizens not having electricity in the country since the sector had been privatised.

According him, “if you don’t have electricity, it is not the Federal Government’s problem, take the matter to the people who are operating the power sector, generation and distribution companies.

“There are problems without a doubt and we must deal with them. But let me remind you, all of the assets that the Ministry of Power used to control for power have been sold by the last administration before I came. And so, if you don’t have power, it is not the government’s problem. Let us be honest.

“The people who are operating the power sector, generation and distribution are now privately owned companies. I am here because I am concerned. If your telephone is not working, it is not the Minister of Communication that you go to. Let us be very clear.

“So, for those of you who want to weaponise electricity, face the businessmen who have taken it up. Let us be honest; if your bank over-charges you interest, is it the Minister of Finance you go to? So, let’s be clear, this is now a private business by Act of Parliament 2005.

“My role is regulatory, oversight and policy, but I have a problem which is the fact that I can’t see a problem and turn my back, so I’m getting involved. So, the people you should be talking to about transformers is not me, the ministry doesn’t supply transformers anymore.”

He further defended his position on the issue, insisting that the minister supervises the ministry and that the GENCOs and DISCOs were players under the FMPWH.

Taking a cue from the analogy given by the participants while answering a question, the minister said: “I think that NERC (Nigerian Electricity Regulatory Commission) is the referee of the game. I am FIFA (Federation of International Football Association) and it is not right as you said that FIFA gets involved, because whether the referee makes a mistake or not, the goal stands.

“So the FIFA man does not enter the field to say go and change the result, but it’s an interesting analogy that I’ve also contemplated in my head and that’s why you didn’t catch me by too much surprise. However, it is important to allow the referee to continue to decide the game because investors like to know who decides.”

We’ve exceeded majority of our contractual obligations  — GENCOs

Reacting to the minister’s position, Generation Companies, on Thursday, refuted the claims, saying they have exceeded contractual obligations set by the Bureau of Public Enterprises, BPE.

In a statement, Dr. Joy Ogaji, Executive Secretary, Association of Power Generation Companies, argued that it had scaled through despite challenges in the power sector.

“GENCOs, despite the stern challenges they are faced with from inception till date, have in association with the above FGN objective, kept to the terms of the industry agreements they entered into with the BPE, which defines the relationship between the privatised companies and the government (Represented by BPE and Ministry of Finance incorporated, MOFI), with a five year period to recover lost capacities.

“Records from BPE shows that as at the takeover date, in November 2013, available generation capacity was 4,500MW. Also, installed generation capacity currently stands at 13, 496MW as against 12, 500MW at take over. GENCOs engaged on a massive capacity recovery plan with their acquired asset and achieved in no time lost capacities increasing available capacity to 7, 913MW.    

“GENCOs have not just increased their capacities, they have also improved in operational performance in the area of human resource management, Quality, Health Safety and Environment standards and community service responsibilities, which are all components of their agreement. ‘Success story of GENCOs’

“Today, BPE confirms most of the GENCOs have exceeded their contractual obligations. For instance, Ughelli Transcorp at takeover date had generation capacity of 160 MW and has increased to over 701MW which they achieved in 2017. Similarly, Egbin at takeover in November 2013, averaged generation of below 300-MW due to the dismal operational state of its six units.

“At its lowest point, only two of the six units were partially operational. Egbin currently has ramped up capacity to generate 1,320 MW subject to gas availability. On the other hand, the Hydros like Shiroro at takeover had 450mw with some of the units not operating optimally, they have overhauled the units and Shiroro now generates 600mw which was the stalled capacity.

“Mainstream Energy Solutions Limited has increased the combined Generating Capacity of Kainji and Jebba Power Plants from 582MW as at takeover to 922MW. Overhaul has been successfully carried out on one of the generating Units at Jebba Plant. Capacity recovery process on other unavailable units continues which will enable the plants recover to full installed capacity. These are just a few of the successes. We cited two thermal and two hydro plants for purposes of brevity.

“Meanwhile, the privatisation of the power sector has exposed the inherent structural weakness in the sector. As investors, GENCOs are worst hit in this electricity market logjam. They generate power and the power is consumed and not paid for. The TEM regulation betrayed GENCOs. Ineffective contracts as against the TEM promise; Imposed quasi-PPA; Constrained down and out – unrecognized deemed capacity, EoH effect, wrongly defined Available Capacity. The above facts culminate to the understanding that whatever is on paper today as an outstanding to any GENCOS is less than the actual. GENCOs are all casualties, a collateral damage to the economy.”