The Nation Newspaper

Tag: Nigerian Electricity Supply Industry (NESI)

  • FG urges enumeration of electricity consumers

    FG urges enumeration of electricity consumers

    …NERC explains how to get transformer refund from DisCos

    …World Bank willing to provide $2.6b for Programme

    The Minister of Power, Works and Housing, Babatunde Fashola has said that the Nigerian Electricity Supply Industry ( NESI ) needs to embark on the enumeration of electricity consumers.

    He noted that the electricity market lacks the knowledge of how much or how many people are utilizing the power since some customers bear the burden of paying for stolen energy owing to lack of meters for billing consumption.

    The minister however urged for social justice between the consumers and the service providers, calling on whistleblowers to assist the NESI with intelligence of energy theft that could lead to the arrest of the thieves.

    Fashola spoke during a workshop for the Civil Societies Organizations (CSOs) on the Power Sector Reform Programme in Abuja. 

    Blaming the commercial losses of the Distribution Companies (DisCos) on energy theft, he said that : “Energy theft is the cause, if you sell the product and you don’t collect the money, that business is in danger. So, I my opinion: we need to know how many people are using the electricity. We don’t know.  So, some people are paying for what others are using and we need meters to achieve justice between consumers and service providers. 

    “And as I said before this is a place we need a lot of whistleblowing, if you know anybody who is stealing energy call us so we will come and pick the person. So that he will stop being a problem to his community.”

    Some of the CSOs had lamented that the ministry was only considering the commercial losses of the DisCos, yet reticent about customers and communities that have also become investors, providing electricity cables, transformers and other equipment to the companies, who also charge them exorbitant estimated bills. 

    Fashola asked the Nigeria Electricity Regulatory Commission (NERC) to respond to the CSOs position.

    Reacting, the Commissioner on Consumer Affairs, Dr. Moses Arigu, explained that the due process for community to follow to procure equipment as transformers for the DisCos is to start from informing the DisCo, the Nigerian Electricity Management Service Agency to arrange and ensure of the standard of the transformer prior to its procurement. 

    He added that “the money is supposed to be refunded. Again, you have to work it out with the DisCo and that is not physical cash but through energy crediting. So it is not that when we invest why should they send a bill again?”

    He revealed the final consultative forum for the metering regulation was held in Lagos on Monday and Tuesday. The document, according to him, will solve problems of estimated billings. 

    The Power Sector Recovery Programme Components aims at the definition of a “tariff adjustment trajectory, so that tariffs cover the revenue requirement of efficient service provision by 2021.

    “Establish the revenue requirement of DisCos and transmission (TCN), and consistently apply tariff adjustments according to the defined tariff trajectory with automatic adjustments as service delivery improves.”

    The Programme is also to develop a financing plan to fully-fund the shortfall (the difference between the sector revenue requirement and revenue under effective tariffs based on a defined tariff trajectory) until tariffs attain cost recovery levels, and support sector liquidity.

    The World Bank Group, according to the federal government, World Bank Group has indicated potential support for the  Programme totaling up to $2.6billion.

  • AEDC denies issuing “Force Majeure” on direct purchase of electricity

    AEDC denies issuing “Force Majeure” on direct purchase of electricity

    Abuja Electricity Distribution Company Plc ( AEDC ) has denied declaring any “Force Majeure” over the new Eligible Customer Policy in the Nigerian Electricity Supply Industry ( NESI ).

    “Force Majeure “ is a contractual and legal announcement, which is used to declare the inability of a party to meet up with a contractual obligation with another party in business.

    The Minister of Power, Works, Housing, Mr. Babatunde Fashola, had on May 15, declared four categories of customers that could purchase power direct (eligible customers) from the generation companies in the NESI.

    The declaration, which permits electricity customers to buy power directly from the generation companies, is in line with the provisions of the Electric Power Sector Reform Act 2005.

    The Nigerian Electricity Regulatory Commission ( NERC ) had also on Nov 6, presented  the  regulations to guide the implementation of the customer eligibility in the NESI.

    AEDC in a statement by its Head,  Corporate Communications, Mr Oyebode Fadipe, said the information in the media on declaration of force majeur came to AEDC  as a  shock.

    Fadipe said AEDC was surprised, when its name was listed in some media as one of the DisCos that declared force majeure on  eligible customer policy of the Federal Government.

    “We have neither declared any force majeure nor have we conveyed such intention to either the Bureau of Public Enterprises (BPE) nor Nigerian Electricity Regulatory Commission (NERC).

    “AEDC did not discuss   with   any other stakeholder in the Nigerian electricity supply industry nor do we intend to do so anytime soon”.

    Fadipe urged AEDC’s  customers and stakeholders to disregard the story as it had nothing to do with  the company  as a player in the NESI.

    NAN

  • Fed Govt may hike electricity tariff

    Fed Govt may hike electricity tariff

    • • GenCos to NERC: add stranded 2,000Mw to capacity

    The Federal Ministry of Power, Works and Housing may bow to pressure from electricity distribution companies (DisCos) to hike electricity tariffs as one of the solutions to resolve the crises in the power sector.

    The Permanent Secretary, Ministry of Power, Louise Edozien, who gave indication to this yesterday in Jos, lamented that low tariffs remained a stumbling block on the way of developing the power sector.

    He spoke during the opening ceremony of the third National Council on Power (NACOP) meeting held at Crest Hotel and Garden Jos.

    The theme of the meeting is: Completing power sector reforms.

    He said: “I will like to focus on two major challenges of the sector. The first one is how to deliver available power on the grid to consumers, and the second is the problem of debts and other related issues of collection and tariffs.

    “The tariff is too low, and some consumers still don’t pay their bills, in part because the DisCos have not metered them; so they are not sure they are paying for only what they have consumed. So, the DisCos do not pay Nigeria Bulk Electricity Trading (NBET) its full invoice. NBET in turn defaults in payment to the generation companies (GenCos).”

    Meanwhile, the GenCos yesterday urged the Nigeria Electricity Regulatory Commission (NERC) to classify the stranded 2,000Megawatts (Mw) as part of the available generation capacity in the Nigerian Electricity Supply Industry (NESI).

    The Commission, according to its presentation on the review of the Multi-Year Tariff Order (MYTO) methodology by Senior Manager, Market and Rate, Abbah Tera, takes generation capacity as one of the criteria for review of tariff.

    Responding, the Executive Secretary, Association of Power Generation  Companies (APGC), Mrs. Joy Ogaji, said  the fact that the stranded capacity is not utilised does not mean that it is not produced by the GenCos.

    She noted that there is enough gas but the only constraint its cost, stressing that the GenCos should not suffer owing to the stranded power.

    She said: “We are not saying we don’t have enough generation. The only constraint that Nigeria is having is the cost of gas. We have over 2,000Mw sitting. The over 2,000Mw should be treated; it is available; GenCos should not suffer for it . In line with the review NERC should capture the stranded capacity.”

    Some of the stakeholders urged the commission to privatise the Transmission Company of Nigeria (TCN) since it is obvious that the Federal Government which operates it has proven inefficient.

    The Commissioner of Engineering Performance and Monitoring, Prof. Frank Okafor, however explained that the cost of funding the transmission network is too enormous for a private company to raise for the operation of the system.

    “It will be difficult to get investors that will fund the TCN,” he said.

    Besides, he said it might be difficult to secure the right of way for the network since it transverse so many states of the federation.

    According to him, government is borrowing from multilateral financial agencies to expand the grid since the amount of power delivery is not sufficient to raise the required revenue.

    The commission maintained that it has met with the TCN and DisCos in order to deliver the stranded power to consumers.

    but for the commission to get stakeholders’ inputs on (the frequency of the review) how often the review should be carried out.

    The stakeholders were also divided on whether the tariff should be reviewed bi-annually, monthly or yearly.

    NERC carries out a major tariff review every five years and minor review every six months.

    But speaking, representative of Mainstream Energy Solutions Limited, Musa Abba Bajoga, urged the commission to follow the global practice to “do what is done universally.”

    The President Hotel Owners Association of Nigeria, Dr. Ezeh Udeh told the commission to consider a yearly review since hotel rates are not reviewed monthly and that any price that rises in the country hardly falls.

    Network of Electricity Consumers Advocacy of Nigeria (NECAN),  Tommy Akingbogun, told the commission not to use its rate to kill investors.

    Edozien said: “Government, as part of the power sector recovery programme approved a N701.9 billion payment assurance guarantee to ensure NBET discharges its obligation to the GenCos.

    “Government has also audited the N27 billion debts owed by Federal Government ministries, department and agencies (MDAs) to the DisCos and is taking steps to pay it.

    “NACOP 2017 is taking place at an important moment in the journey. Our objectives are not met, so much remain to be done. NACOP 2017 is the appropriate forum to access our progress, reaffirm our commitment, examine the challenges of the moment and take decisions to overcome them to ensure this journey achieves the desired outcome.”

    Plateau State Commissioner for Water Resources and Energy, Jafaru Wuyep in his goodwill message on the occasion expressed delight on the proposed Infrastructure Marshall of the Federal Government for the protection of public facilities from vandals.

     

  • Association expresses concern about FG’s N701bn Power Intervention Fund

    The Association of Nigerian Electricity Distributors (ANED) says the N701 billion Power Intervention Fund by the Federal Government has the potential to worsen revenue shortfalls bedeviling the power industry.

    The ANED Executive Director, Research and Advocacy, Mr Sunday Oduntan, said on Sunday in Lagos that the fund was a partial solution to the sector’s liquidity challenges.

    NAN reports that on March 2, the Minister of Power, Works and Housing, Mr Raji Fashola, announced that the Federal Government had approved N701 billion as “Power Assurance Guarantee” for the Nigerian Bulk Electricity Trading.

    According to the minister, this is to make payments to the Generating Companies (GENCOs) and gas suppliers for energy supplied and future supplies of gas and energy.

    Oduntan said, though, the fund was a welcome development, it, however, had the potential of exacerbating the revenue shortfalls that the market was suffering from.

    He said the fund would solve the N300bn energy supply liabilities, rehabilitate and replace faulty or old turbines and pay for the supply of gas.

    “As commendable as this intervention fund is, we believe that it is a partial solution to the liquidity challenges of the sector.

    “While an increase in electricity supply is everyone’s desired objective, such an increase without the requisite full recovery of costs via the appropriate pricing of power, means a resultant worsening of the market revenue gap,” the ANED director said.

    He said that he believed that the approved intervention was not expected to be a subsidy to the market but the proposed funding would eventually be recovered from the Electricity Distribution Companies (DISCOs) customers.

    According to Oduntan, funding the transmission network is imperative for the Federal Government’s proposed intervention to work.

    “The Transmission Company of Nigeria (TCN) needs to have the required capacity to wheel the additional power being generated for such recovery to occur,

    “Increased generation without commensurate wheeling capacity arising from a stable and robust transmission grid will result in stranded capacity and significant lost revenues.

    “From the little details made available to us, the historical shortfall does not seem to have been addressed within this initiative.

    “This is imperative as the DISCOs need to be able to make the necessary investments in network upgrades, improved customer service, billing and collections, metering, all of which have been major issues in the industry.

    “Such investments will not happen unless the DISCOs make the projected annual revenue requirements, which enables access to finance for the required capital expenditure (Capex).

    “Access to such financing is predicated on appropriate pricing of the retail tariff.

    “The growing working capital debt on the DISCO’s books less any amount to be paid under the intervention, will also continue to impede DISCOs’ ability to fund retail distribution from Capex requirements,’’ he said.

    The ANED chief said it was essential to use this period to appropriately allocate all the risks in the electricity value chain.

    He said this included the need to address the issues of access to foreign exchange and security of gas pipelines.

    Oduntan said that regulatory certainty and consistency continued to be the foundation for enabling and promoting the commercial conditions that would ensure a viable and sustainable Nigerian Electricity Supply Industry (NESI).

    He said that though ANED applauded the GENCOs/Gas Supplier-centred intervention, it believed that there was an urgent need for a holistic solution that comprehensively addressed the revenue requirements of the entire electricity value chain.

    “We believe the achievement of the stated objectives of providing confidence to investors for increased supply of electricity with the provision of this intervention will happen at the expense of limited electricity distribution,’’ Oduntan said.

     

  • Power generation drops by 207.1 MW on gas shortage – TCN

    Power generation drops by 207.1 MW on gas shortage – TCN

    The Transmission Company of Nigeria (TCN) said that that the nation’s power generation capacity dropped slightly from 3,959 megawatts from January 4 to 3,751.90 megawatts on Jan. 12, due to the dearth of gas.

    The Nigerian Electricity System Operator (SO) website, a sub-agency of TCN, disclosed the figure on its daily forecast website on power generation data in Lagos on Thursday.

    TCN put the total output of all the generation companies at 3,751.90 megawatts, said to have been transferred to the 11 distribution companies across the country.

    The website showed that the country’s power generation also recorded the lowest peak at 2,876.80 megawatts.

    According to the Nigerian Electricity Supply Industry (NESI) operational report for Jan. 4, the power sector hit a peak generation of 4,959 megawatts as against 3,321 megawatts recorded in Dec. 2.

    NESI said that the sector recorded highest system frequency of 51.27Hz; lowest system frequency of 48.22 Hz; highest voltage recorded was 372KV, while lowest voltage recorded on the same day was 300KV.

    An official of TCN, who preferred anonymity, said that electricity generation had been dwindling due to challenges of accessing gas by generation companies.

    The official said that many power projects that could boost the country’s generation were still pending due to lack of fund and gas shortage to test run the turbines.

    Similarly, a top management official of Egbin Power Station, who also pleaded anonymity, said that the power plant which usually generates over 1,000 megawatts had dropped to 375 megawatts due to the gas constraint.

    According to him, the plant, located in Lagos, generates and distributes between 250 megawatts and 300 megawatts due to the shortage of gas.

    The official said that Egbin, with an installed capacity of 1,320 megawatts, had the capacity to wheel over 1,000 megawatts daily.

    He said that the plant had been limited to less than 400 megawatts due to te shortage of gas.

    Meanwhile, the Minister of Power Works and Housing, Babatunde Fashola, during the 11th Monthly Stakeholders meeting in Lagos on Jan. 9, unveiled plans to inaugurate some electricity projects this year.

    Fashola said that some of the projects to be inaugurated in the course of the year include the completion of the Kaduna 215 megawatt power plant, the Gurara project and the Gardin Kowa plant.

    Others are switching of the Gudenda substation, as well as the conclusion of the Katsina wind and the Abuja solar farms.

    The second phase of the Abuja solar project, he said would run-up from 800 megawatts to 1.2 megawatts and raised the hope of the possibility of partnerships in the area of development of hydro dams.

    He also disclosed that there were 14 projects for transmission in Lagos State and Ikeja West, the largest in terms of transformer capacity, was undergoing expansion to respond to the growing needs of the population.

    “This tells you clearly that the transmission system is not static, it is dynamic and expanding.”

    According to the minister, the evacuation of power at the Ikot Ekpene switching station is what has kept the grid to almost 4,000 megawatts.

    “We still have 3,000 megawatts out from the damage of the Escravos and Forcados, so if that comes back, we are almost at 7,000 megawatts, so the target is incremental power.”

  • Power generation hits 3,959MW

    Power generation hits 3,959MW

    The Transmission Company of Nigeria (TCN) on Wednesday wheeled out about 3,959 megawatts of generated electricity to the 11 distribution companies as the country’s power supply gradually stabilises.

    The News Agency of Nigeria (NAN) reports that power generation data is obtained from daily forecast on the Nigerian Electricity System Operator (SO) website.

    The daily power statistics posted by SO, a section of the TCN, shows that power generation gradually improved during the festive season with a peak generation of 3,959 megawatts from the national grid.

    The website shows that the country’s power generation also recorded its lowest generation of 3,366 megawatts within the same period.

    According to the Nigerian Electricity Supply Industry (NESI) operational report for Jan. 3, the power sector hit a peak generation of 4,959 megawatts as against 3,321 megawatts recorded on Dec. 2.

    NESI, a subsidiary of the TCN, said that the sector recorded highest system frequency of 51.52Hz and lowest system frequency of 48.85 Hz.

    It also said that the highest voltage recorded was 372KV, while lowest voltage recorded on the same day was 300KV.

    Meanwhile, NESI, on Jan. 3 disclosed that over N534 billion of revenue was lost by the power sector in 2016.

    Among the reasons for the loss are shortages in gas supply, frequency and line limitations and water levels management constraints that led to several cases of electricity outage in the country.

    NESI, which put the average daily revenue loss at N1.5 billion, said gas constraint remained one of the major challenges facing the electricity sector.

    It explained that the N534 billion amounts to the value of electricity lost on account of the challenges, part of which could have been used to bridge the liquidity gap in the power sector, estimated at N1trillion.

    Already, the sector is finding it difficult to access more loans from Nigerian banks due to their inability to meet the payment obligations for previous debts.

    The situation will also affect the capacity of the power firms to improve on electricity supply to consumers for domestic and industrial uses.

    NESI said in its daily statistics on energy losses that the industry lost N1.525 billion on Dec. 24, 2016, alone.

    It also disclosed that about 12 power stations could not produce electricity during the off-peak period under the review.

    Statistics from the National Control Centre, Osogbo, showed that Afam IV-V, Geregu Gas, Alaoji National Integrated Power Project (NIPP), Olorunsogo Gas, Odukpani NIPP, Okpai, Ibom Power, ASCO, AES, Omoku, Rivers NIPP and Gbarain power plants could not produce a single megawatt (MW) on Dec. 25, 2016.

    Nigeria has installed power output of 11,165MW, of which the 12 plants have a combined capacity of 2,035MW.

  • Water management constraint hits power sector

    Water management constraint hits power sector

    • TCN sends 3,269MW to DisCos

    The Nigerian Electricity Supply Industry (NESI) that did not experience any challenge from water to fuel the hydroelectric stations for the past four months lost 90 Mega Watts (MW) due to water management constraint on Saturday.

    According to a document on power sector activities that The Nation sighted on Tuesday, the NESI on Saturday experienced losses owing to water management in that was restored on Sunday.

    A reliable industry source however told our Abuja correspondent that there was a “mechanical problem in Jebba” Hydro Station that was down on November 12.

    The sector lost 3,514MW owing to vandalism of a gas pipeline.

    The document added that the sector lost 279MW to line constraint, although there was no loss due to high frequency constraint.

    The water, gas and line constraints culminated in a loss of about N1.86billion on the day under review that the Transmission Company of Nigeria (TCN) sent 3,269MW to the 11 distribution companies (DisCos).

    NESI said: “On November 12 2016, average power sent out was 3269MWh/hour (up by 347MWh/h). The reported gas constraint was 3514MW. The reported line constraint was 279MW and the high frequency constraint is 0MW according to TCN.

    The water management constraint was  90MW. The power sector lost an estimated N1,863,000, 000 on November 12 2016 due to constraints.”

    The Nation also learnt that there was a system disturbance at 14:27hours on the day under review due to series of line trappings.

    It added that Odukpani power plant was being prepared to evacuate four turbines.

    The document said: “System disturbance at 14:27hrs on November 11 due to a series of line trippings. Further vandalism on the ELPS line has increased gas constraints and  impacted generation negatively. Ikot Ekpene switching station undergoing pre-commissioning tests.  Odukpani power plant is currently been prepared to evacuate 4 turbines.”

    Investigation however shows that the sector recovered from the technical issue in Jebba to record 0MW water management constraint on Sunday.

    According to NESI report, the TCN wheeled 3,476MW to the 11 DisCos on Sunday when power generation rose by 206MW.

    The constraints led to a lost of about N1.88 billion  in the electricity market on the day under review.

    On the day under review,  sector lost 3,591MW to gas constrain and 328MW to high frequency. NESI said on “November 13 2016, average power sent out was 3,476MW by 206MW. The reported gas constraint was 3,591MW. The reported line constraint was 0MW and the high frequency constraint was 328MW. The water management constraint was 0MW. The power sector lost an estimated N1,881,000,000 on November 13 due to constraints.”

  • Power generation hits 3483.7MW

    Power generation hits 3483.7MW

    The Nigerian Electricity System Operator (SO) Tuesday said that Nigerian Electricity Supply Industry (NESI) at the 06:00hours on Tuesday produced 3,483.7 Mega Watts (MW).

    This was contained in its spotlights on grid operation which noted that on November Monday the lowest power generation was 2,970.1MW, while peak generation was 3,819.2MW.

    It added that the highest frequency on Monday was 51.34Hz and lowest frequency was 48.46Hz.
    The highest voltage recorded on that day was 357KV and the lowest voltage 295 KV.

    In its operational report for November 5, the NESI noted that the SO of the Transmission Company of Nigeria (TCN) evacuated 3,586MW to the 11 electricity distribution companies.

    In the day under review, the sector recorded gas constraint of 3,176MW and 412MW line constraint.

    The sector also recorded 26MW high frequency constraint, although water management constraint was 0MW.

    According to the report, the cost of losses recorded in the sector due to all the constraints was N1.735 billion.

    The NESI said that: “On November 5 2016, average power sent out was 3586MWh/hour (down by 7MWh/h).  The reported gas constraint was 3176MW. The reported line constraint was 412MW and the reported high frequency constraint is 26MW according to TCN. The water management constraint was 0MW. The power sector lost an estimated N1, 735, 000, 000 on November 5 2016 due to constraints.”

  • Gas constraint causes shortage of 3,269MW

    Gas constraint causes shortage of 3,269MW

    The Nigerian Electricity Supply Industry (NESI) has said that generation companies (GENCOs) could not produce 3,269MW as a result of the shortage of gas  for fueling the power plants.
    In its October 8 performance report that it posted on its website on Monday, it noted that the power sector lost 371.7MW due to line constraint and also lost 479.4MW owing to a high-frequency constraint.
    According to NESI, there was no challenge due to water management, but on the day under review, the total constraints led to a loss of about N1.978billion.
    Following the losses, the Nigeria Electricity System Operator (SO) that would have sent out about 7,247MW were there on constraints, only sent out 3,335MW to the 11 distribution companies (DisCos).
    The report said:  “On October 8 2016, average power sent out was 3335MWh/hour (down by 164 MWh/h). The reported gas constraint was 3269MW. The reported line constraint was 371.7MW and the reported high-frequency constraint is 479.4MW according to TCN. The water management constraint was 0MW. The power sector lost an estimated N1,978, 000, 000 on October 8, 2016, due to constraints.”
    Meanwhile, the Nigeria Electricity System Operator (SO) of the Transmission Company of Nigeria (TCN) said that at 06:00 hours of October 10, it hit an energy generation of 3,805.10MW.
    The power sector had last Thursday said that the three hydroelectric stations which include Kanji, Jebba and Shiroro produced 283MW, 415MW,380MW respectively, totally 1,119MW.
    It added that Egbin generated 380MW, Sapele I 59MW, Delta 324MW, Geregu 134MW, Omotosho 168MW, Olorunsogo 153MW Geregu  NIPP 123MW,Sapele NIPP 104MW, Olorunsogo NIPP 77MW, Omotosho 193MW, Odukpani NIPP 51MW, Okpai 339MW, Ibom 63MW, Omoku 33, Transamadi 14MW, Transamadi 113, Paras Energy 48MW, and Gbarain 95MW.
    The Nation observed from the operational performance of the SO that contained this data that seven power plants did not produce power on the day under review.

  • Power generation hits 3,277MW

    Power generation hits 3,277MW

    The Nigeria Electricity System Operator (SO) on Tuesday said that the power producers at 06.00 hours generated 3,277 Mega Watts (MW).

    According to its power performance for Monday production, SO note that the peak generation for the day under consideration was 3,886.50MW while lowest power generation was 3,009MW.

    It added that the total energy it sent out to the 11 distribution companies on Monday was 3,402MW.

    Meanwhile, the Nigerian Electricity Supply Industry (NESI) had said that it the SO on Sunday supplied 3,422MW to the 11 DisCos.

    According to the daily summary of the sector’s performance that NESI posted on its website on Monday, gas shortage caused a loss of 3144MW.

    It added that in the day under review there was 121MW frequency constraint and 482MW line constraint, although there was on water management constraint.

    The estimated cost of the constraint was an equivalent of N1, 799, 000, 000.

    NESI said that: ” On September 11 2016, average power sent out was 3422MWh/hour (up by 158MWh/h). The reported gas constraint was 3144MW. The reported line constraint was 482MW according to TCN. The reported high frequency constraint is 121 MW. The water management constraint was 0MW. The power sector lost the estimated equivalent of N1, 799, 000, 000 on September 11 2016 due to constraints.”