If there are still lingering pretences about what is left of the restructuring of the electricity sector under the so-called Power Sector Reform Act 2005, two developments which emerged from the 18th Monthly Power Sector Stakeholders Meeting hosted by Kano Electricity Distribution Company (KEDCO) may have finally sealed it. Not only did the outcome finally lay bare the bad faith of the government and its attendant hollow posturing as an impartial umpire in the process to midwife change in the sector, it also exposed the farce packaged as the liberalization.
I start with the approval by the Federal Government of the tidy sum of N39 billion as loan to Electricity Distribution Companies (DISCOs) for the supply of meters. On this, the minister would have us know that the gesture was part of power sector recovery programme aimed at ensuring that every consumer of electricity is provided with a meter. That ordinarily seems fine except that the government needed not treat the firms as another parastatal of the government subject to period bailouts. What then is the essence of privatization if after formally relieving the federal government of the burden of funding and operating the anaemic entities, the same government still has to make back door financial accommodation to keep them in business? And for how long?
The second is the strange announcement by Minister Babatunde Fashola that the federal government “will not oppose the wishes of electricity consumers that are willing to pay for meters from their distribution companies based on agreement between both parties as endorsed by the power sector regulator”. He claimed that he had “been receiving several requests from the Discos that their customers still wanted to pay for meters”.
Permit me to quote the minister extensively: “Please recall that government had in the past attempted to intervene in meter supply through CAPMI, which ultimately I decided we should wind down because of the distrust and disaffection it was creating between consumers and Discos with government caught in the middle with numerous petitions by customers who paid for meters that were not delivered within the approved time.
“Some Discos have come back to say that their customers still want to pay for meters and they can reach agreements with them on how to pay for it. Government will not stand in the way of such an agreement. It is consistent with the intent of privatization envisioned by the Electric Power Sector Reform Act or at least it does not violate the Act.”
And in what appears like a bid to take out the sting out of the abdication, the minister added: “What I will reiterate is that the Discos have the obligation to meter customers because they are the ones who charge for electricity which must be measured. If the customers and the Discos reach an agreement between themselves, where the customer assumes the responsibility of the Disco of his own free will and NERC sanctions this agreement, then so be it.
“The difference between this kind of agreement and CAPMI is that it is not a government initiative. However, through NERC, government will monitor and regulate to ensure that Discos do not use this as an excuse to abdicate their responsibility to provide meters.”
The minister, a lawyer and Senior Advocate of Nigeria to boot, may feel entitled to his play on words or even seek to rewrite the rule books on power sector restructuring in whatever way that suits him; what he is not entitled to is the attempt to pull the wool on the eyes of the citizens.
A quick recap of the exercise – that has since turned the mother of all deceptions – would help here. Nigerians will recall the story of how the power sector got stunted under successive nomenclatures – from ECN to National Electricity Power Authority – NEPA and of course, to the transitional holding company, the Power Holdings Company of Nigeria (PHCN); the years of corruption and under-investment that took the sector to the nadir, and how the efforts by successive governments to improve the situation yielded no respite leaving the country with a miserable 4,000MW of power generation, a broken transmission grid and a hopelessly incompetent distribution chain after some 130 years after the first public power plants opened for business and 66 years after Electricity Corporation of Nigeria came into being via an Act of parliament.
Flip over to the Power Sector Reform Act 2005 – the anchor for arguably the most ambitious attempt to restructure the electricity sector since independence. From the go, the exercise, as advertised, was designed to mobilize funds and expertise from the private sector, to modernize, upgrade its systems to deliver world class service. Twelve years on, the verdict is one of a dream aborted – whether of the much needed injection of requisite capital or of new technologies to turn things around, or of basic service delivery as one would imagine under a private sector, it has been an unmitigated disaster. Today, the story across the board is that things have fared worse than when the sector was under government control. From the gas infrastructure that has remained shambolic to the antediluvian transmission lines right up to the patently anaemic Discos, it is increasingly difficult to find any redeeming feature on an exercise on which the country has staked much faith.
Even for something as ordinary as the demand by the electricity consumer for meters to enable them pay only for what they consume, the government had to broker accommodation for the Discos through the so-called Credited Advance Payment for Metering Initiative (CAPMI) which allowed customers to pay for electricity meters through their respective Discos. Ironically, the exercise was bungled by the same Discos due essentially to their inability to supply the meters after payments were made. This was what made the minister to direct the regulator to wind up the programme in April last year. The mother of all ironies is that the same Discos that could not meet that basic obligation under government direct oversight are now being promoted by Minister Fashola as the guarantor of the public good and this under a novel notion of best practices.
While I have written a lot about the botching of the power reform; of the abiku discos that would rather feast on our misery than give us light, and the inept regulator terribly out of depth with the breathtaking developments in the sector. What no one could have bargained for, at least from a government that rode into office on a banner of change is the latest act of surrender to a bunch of inept but no less, extortionate service providers. Talk about turning cycle – under the ancien regime, the electricity consumer is more often than not not, known to have supplied service cables, transformers and other vital materials. Today, we are apparently back to the same starting block where the consumer is being asked to provide supplementary capital to enable our much touted messiahs provide us meters. It seems only a matter of time before the electricity consumer is once again enlisted into the business of providing transformers, cables, couplings – and don’t rule it out – voluntary labour – by the their government.
Whenever it happens – as I am sure it will somehow do at some point – at least we know who to thank.
