The Nation Newspaper

Tag: transmission

  • 47 transmission projects ‘near completion’

    The Federal Government is set to boost electricity supply with the completion of 47 transmission projects nationwide, Power, Works and Housing Minister, Mr. Babatunde Fashola, has said.

    Fashola, who fielded questions as guest on Channels Sunrise a Daily programme, said there was a plan to complete the projects in this year’s budget.

    The Minister, who was responding to questions on specific steps being taken to improve electricity supply, said: “There is a plan to complete 47 transmission projects in this year’s budget and I believe we can do it even if the budget is passed tomorrow.”

    He said in addition to those projects, government was also looking at other sources to achieve incremental power, adding that improving power is tied to the completion of the projects using a variety of sources including wind.

    Pointing out that incremental power would be achieved through a mix of power sources, the minister added: “In the last four weeks, we have approved a framework to start licensing about 14 solar power projects. Cumulative power from all is about 1,286megawatts (Mw). But they will be different companies, some have 100Mw and some have 250Mw and some have 50Mw. But all these are being processed to come on stream, because that is the real solution, to get more power on and, in the process, give relief. And so in that sense, I am optimistic that we will turn that corner”.

    Other areas the government is looking at, according to Fashola, is in revamping the only coal power station in the country, the Oji River Power Station, which he visited recently adding that the station has long fallen into dilapidation.

  • Fashola unfolds 13-point agenda to revive power sector

    Fashola unfolds 13-point agenda to revive power sector

    The Minister of Power, Works and Housing, Mr Babatunde Fashola, on Monday unfolded a 13-point agenda to drive efforts towards enhancing power supply in the country.

    Fashola said in Abuja during his maiden meeting with power generation, distribution and transmission companies, and other stakeholders that the agenda was drawn up to ensure effective monitoring of the sector.

    The minister said the agenda involves continuous public engagement on tariff collection, debts, power generation, maintenance, ancillary services, dispatch orders and discipline.

    Other areas include gas requirement and constraints, transmission constraints, 33KV load off take, imbalances-locations of excess, overload safety, service quality, new captive and embedded generation, franchising and other issues relevant to the growth of the sector.

    According to Fashola, President Muhammadu Buhari has approved that all stakeholders in the sector should hold monthly meetings on issues concerning the industry.

    He said that the meeting would be rotated among the various GENCOs, DISCOs, TCN and other stakeholders across the country.

    Fashola said that all decisions reached in such meetings would be binding on all the stakeholders.

    In this respect, the minister stated that the various companies and stakeholders would each be represented by a management member with authority to take decision on behalf of their companies.

    He explained that in order to minimise the cost of hosting the meetings, the companies were advised to jointly pull up resources required to hold the meetings.

    The minister further said the meetings would also involve lawyers, engineers, planners and other stakeholders, adding that the ministry would issue a communiqué at the end of each meeting on steps taken to address challenges in the sector.

     

  • Factors limiting power generation and transmission

    SIR: Of the three components of Nigeria’s electricity matrix – generation, transmission and distribution, the government seems to have been smart enough to hold on to the transmission component, with  the advantage of ascertaining the total quantity of power available at every point in time. It shows how much has been generated and the aggregates as well as how much has been consumed.

    However, the expected quantum leap has failed to materialize substantially, more than two years after the unbundling and privatization in the sector.

    At this point, every concerned citizen and patriot should be asking questions such as: Why have we covered so little mileage? Why have we generated disproportionately low megawatts per thousand dollars compared to other economies? Why have we failed to surpass the 6,500 megawatts landmark which some claim was the figure being generated way back 40 years ago?

    I have based on research, articulated the following issues: First, it takes far too long to get approval/licenses to build power generating plants in Nigeria, sometimes even more than two years. No serious minded investor is willing to tie down funds for this length of time.

    Secondly, it takes far too long to construct approved power projects, sometimes up to four years, partly due to community issues and partly due to cumbersome procurement and logistics procedures.

    Third, the process of procuring fuel to power the plants, especially gas is often disjointed and constitutes a separate project with unique challenges.

    And finally, providing transmission facilities through the Transmission Company of Nigeria (TCN) is a herculean task, subject to the full dose of Nigerian bureaucracy.

    These issues are the common denominators preventing Nigerians from enjoying full benefits from investment in the power sector.

    The above scenario provides a glimpse into the myriad of issues beguiling Nigeria’s power industry.

    Rather than issue licenses to companies to generate power, government should completely deregulate the process by changing the rules to allow the TCN set long-term purchase contracts, guaranteeing a preset take-on price per megawatt generated by any private enterprise.

    The process should prescribe the minimum standard of operation that will allow such companies operate safely, competitively and in an environmentally friendly manner.

    This, for instance, will enable platforms such as the NIPP canvass and link up investors and technical partners in turning out modular power generating facilities across the country on a continual basis.

    Intending investors and proprietors should identify multiple locations suitable for their proposed projects and make prospective communities bid to host the projects based on clearly stated benefits. The winning community will naturally be made to provide guarantees that will ensure smooth construction and operation during the bid process. This will eliminate most of the bottlenecks usually encountered by the operators during construction which causes serious delays and project scope creep resulting in cost escalations.

    The government should carry out a sincere and thorough national transmission needs assessment and identify Original Equipment Manufacturers, Repairs and Spares Providers, conduct bid processes to pre-select preferred equipment suppliers and maintenance service providers. Thereafter, contracts for the upgrade and maintenance of the existing transmission infrastructure and additions would be awarded as needed. The upgrades and additions will be coordinated by the technical department of the TCN. This department must be audited “three times daily”.

    • Dan Aibangbe,

    Lagos.  

  • TCN shortlists investors for 8,000Mw transmission capacity

    TCN shortlists investors for 8,000Mw transmission capacity

    • N15b needed yearly for three years

    The Transmission Company of Nigeria (TCN) has shortlisted over 30 local and foreign investors for investment in the transmission infrastructure to enable it attain its target of 8,000 megawatts (Mw) capacity by end of next year.

    The firm has set a target to achieve the capacity to transmit 8,000Mw of power by the end of next year considering the continued improvement in power supply.

    Its Managing Director, Dr. Abubakar Rasheed Tambuwal, an engineer, said the management was being proactive in order not to be caught unprepared.

    He said that the step being taken by the management was important because the Federal Government would not be part of the funding. The investors will bring in their money and TCN will pay them back within an agreed period.

    Abubakar said the TCN wheels out 4662Mw and has capacity for 5300Mw.Although the company can transmit 4662Mw and has capacity to wheel out more, it has to prepare for more power generation and shouldn’t wait for the government before taking steps to achieve that. This is why  management seeks private sector investment.

    To achieve 8,000Mw transmission capacity, TCN needs an investment of about N15 billion yearly over the next three years, he added.

    He said: “We are looking at a minimum of about N15 billion yearly over the next three years if we should be able to achieve the 8,000Mw. Therefore, with regard to the investor financing scheme (IFS), we have just shortlisted investors from within and abroad that are interested in the project. “We have over 30 of them that we feel will be able to deliver on some projects that they have chosen. I cannot tell you the names of the shortlisted investors for now until the deal is sealed and delivered. We are trying to see that they are capable technically and financially because once they come in; they are expected to execute the project themselves with the funding they are able to galvanise from either externally or within the country.

    “We have shortlisted them and we are in the process of coming up with a framework from which they can recover their investment with time. Since the Federal Government will not give them sovereign guarantee, we are coming up with modalities of repayment from the wheeling charges from our internally generated revenue over a period of time. It has not been finalised. We are still working to get all the support that is needed from the government for us to be able to achieve this.”

    He said internally generated revenue is  part of the moneyTCN collected from the customers by the distribution companies, noting that considering the quantum of power generated, TCN’s portion of the collection will be substantial enough to sustain its operation and pay back to the investors in the project.

    On the level of funding from the government, Abubakar said funding has not improved considering the fact that a lot of projects are in the pipeline, which need to be funded and because of the present situation, there is need for additional funding even from what the firm used to have. ‘’We are making all efforts to ensure that we bring funds outside appropriation of government. We have investors who are ready to come in and participate in our investor financing scheme. The scheme is still at preliminary stage but as soon as we finalise it, we will have investors who are willing to put in their funds to develop our transmission infrastructure. We also expect more funding from the Federal Government to be able to achieve the mandate we have set for ourselves to improve on the transmission capacity,” he said.

    Abubakar also explained reason for the improved power supply being experienced. He said generation has improved because gas supply has improved tremendously to generating stations and have been able to generate the highest ever peak in July of 4662Mw. “Our transmission capacity is a bit above that. We are capable of transmitting 5300Mw at the moment. But as generation is improving, we are expected to expand our transmission capacity to be able to evacuate the extra capacity being generated at the station for distribution companies to use. I can assure you that we have our plan, our project that are very critical has been mapped out so that within the shortest possible time, we will be able to reach 8000Mw transmission capacity, by end of 2016.

    “We have never transmitted more than 5000Mw to the customers due to many factors. When you generate, you transmit and utilise in the distribution, the distribution arm has to be ready to receive the quantum of power that has been generated. But I must tell you that transmission is capable of wheeling out 5,300Mw from generation down to distribution. It is only what the distribution companies can collectively take that is what is wheeled as the maximum energy at any given time.”

  • Power transmission hits 4545MW

    Power transmission hits 4545MW

    The Management of Transmission Company of Nigeria (TCN) Tuesday announced   that the nation has achieved a new electricity transmission peak of 4545MW through its national network.

    A statement by TCN Management, signed by the General Manager, Public Affairs, Seun Olagunju, said the feat was achieved at 21.45hrs on Monday.

    The previous power transmission peak of 4517MW was attained on 23rd December, 2012.

    It will be recalled that TCN Management had, only last week, informed the general public that electricity wheeling to the Distribution companies has improved to over 4000MW due to improvement in fuel supply to the power generation plants.

    TCN assures that it will continue to work towards enhancing its power wheeling capability and reliability of the network to be able to deliver more quality electricity from the Generation plants to the Distribution companies nationwide.

    “Expanding this support both bilaterally with the individual countries and to the Multinational Joint Task Force, which the Lake Chad Basin countries and Benin are in the process of standing up to coordinate their counter Boko Haram campaign,” the statement said.

     

  • Panic as Apo transmission system collapses on Inauguration Day

    Panic as Apo transmission system collapses on Inauguration Day

    There was panic at the Nigerian Electricity Supply Industry (NESI) following the collapse of a transmission system (100MVA transformer) in Apo Transmission Station at the Federal Capital Territory (FCT) in the early hours of presidential inauguration.

    A highly placed source who made this disclosure to The Nation on the condition of anonymity, said the Abuja Electricity Distribution Company (AEDC) was earlier billed to receive as much load allocation as possible, but confusion set in when a major fault reared its ugly head at the station.

    In the ensuing confusion, a situation report was communicated to the Disco, while frantic efforts were made to restore power to the Central Business District (CBD).

    Respite however came at about 7.00am after the technical crew succeeded in allocating 20Mega Watts (MW) for sensitive facilities in the district.

    An hour later, it was gathered that the system was able to restore 50MW for more feeders in the city.

    The pandemonium lasted till about 9.00am when the TCN raised the allocation to 309.5MW for all sensitive installations.

    However, the company could not restore power to the Nnamdi Azikiwe International Airport, which was powered with a generator.

    A source said: “We were all at a loss on that inauguration day. I was woken up with the news of the faulty transformer in Apo Transmission Station. This caused panic in both the AEDC and the TCN, which saved the situation that had degenerated to 20 MW as early as 6am in the morning. An hour later, we were able to restore the situation to 100MW and later to 309.5MW. But we could not restore the power to the airport.”

    It was learnt that initial plan was for the AEDC to have as many MW as possible and had expected about 400MW before the fault was detected in the transformer.

    Attempt by our correspondent to speak with the spokesperson of TCN, Mrs. Seun Olagunju, was futile as her phone indicated that it had been switched off.

     

  • NCC set to cap transmission cable price for operators

    NCC set to cap transmission cable price for operators

    Worried by current regime of denial of access to viable routes, predatory pricing and discriminatory and arbitrary pricing in transmission cable sector of the telecoms sector, the Nigerian Communications Commission (NCC) said it will set a cap on its cost.

    It warned that it will not hesitate to sanction any operator that breaches the cap.

    Its Executive Vice Chairman/Chief Executive Officer, Dr. Eugene Juwah who spoke in Lagos at the stakeholders consultative forum on the determination of cost based transmission cable pricing, said while it is the policy of government that appropriate prices be determined by market forces, it has recognised that in the transition from monopoly to full market competition, there would be periods market forces may be inadequate to bring about efficient market conduct and prices that are close to costs.

    Represented by its Executive Commissioner, Stakeholder Management, Mr. Okechukwu  Itanyi who spoke on the sideline after the meeting, he said  after the consideration of the report of the study contracted to KPMG, it will develop “strong enforcement regulations and cap the cost price of transmission cable in the country.”

    According to NCC, KPMG was contacted two years ago to carry out the study as part of its regulatory oversight function to address competitive dynamics, pricing and related matters in cable transmission pricing among operators.

    “In the discharge of our regulatory and oversight functions, we are committed to participatory regulation and shall continue to ensure wide consultation before major decisions affecting the industry are taken,” Juwah said.

    He said the commission engaged the services of KPMG to ensure that the execution of the project is guided by current realities in the sector.

    He explained that presentation of findings from the study to stakeholders is to further prove the commission’s participatory regulation to gather opinions and inputs for best pricing regime in the sector’s cable transmission market.

    The essence of determining a cost based transmission cable pricing and development is to enable a judicious use of spectrum with minimal frequency coordination. This allows links to be deployed close to one another without interference.

    KPMG’s Partner, Management Consulting, Mr. Joseph Tegbe, explained that the primary objective of the project is to develop a cost based option for regulating the pricing of transmission cable in the telecoms industry.

    According to him, the greatest challenge encountered in the project was access to data as it took a year before accessing data from the operators.

    He said having followed international best practices in carrying out with the study, information given by the telecoms operators was used as benchmark in the proposed pricing regime, adding that it took cognisance of the falling value of the naira and interest rate which kept going up.

  • Council seeks N160b yearly for power transmission

    Council seeks N160b yearly for power transmission

    The inaugurated National Council on Power (NACOP) is seeking N160 billion yearly to fund the Transmission Company of Nigeria (TCN) to achieve a cost reflective tariff.

    This is part of its recommendations during its conference last week in Abuja.

    The  council includes  stakeholders from the operators, state governments, commissioners, Federal Ministry of Power and agencies in the sector.

    According to NACOP, 75 per cent of the fund should be set aside for Capital Expenditure (CAPEX).

    The document said: “ Until such a time that a cost reflective tariff is established and 90 per cent or greater of annual earned market revenue is received, it should be ensured that annual funding provided for the Transmission Company of Nigeria (TCN) from market, appropriations sources is not less than N160billion, with 75 per cent fund earmarked for Capital Expenditure ( CAPEX.).”

    NACOP said until such a time when appropriations are required to fund the TCN, employee salary, employee benefits, and critical business infrastructure needs should be funded from appropriations on a prorata basis, based on the prior year’s earned market revenue shortage percentage.

    It set a target of 6,500Mega Watts (MW) by the end of the year.

    The council also recommended a medium term target for transmission capacity and capability of 12,000MW and 10,000MW by the end of 2016.

    NACOP also urged the development of a bankable coal to power study to minimize in coal plant development.

    The council sought the encouragement of the development of small scale power plants as embedded generations which can be increased to evacuate the 132kV for eventual ceding to distribution companies.

    It recommended that the Federal Government should encourage manufacturing of power assets and components.

    NACOP urged state governments to take stakes in Independent Power Projects ( IPPs).

    It recommended that the Federal Government should bank securitisation either through the Nigerian Bulk Electricity Trader (NBET) or the Federal Ministry of Finance.

    The council urged state government to make land with certificates -of -occupancy readily available to potential investors as incentive.

    NACOP sought a robust development plan from the Nigerian National Petroleum Corporation (NNPC) and a commercial gas rate to attract investors.

    It urged the signing of Gas Security Agreements and Gas Transportation  Agreements.

    The council sought a national policy on securing gas oil infrastructure , payment of outstanding gas debt and passage of the Petroleum Industry Bill (PIB).

    The Managing Director of Abuja Electricity Distribution Company (AEDC) , Neil Croucher, at the weekend said that the firm will inject about $200 million in five years to boost power supply and distribution in its coverage area, Kogi, Nasarawa and Niger states.

    According to him, no fewer than 20 injection substations would soon be inaugurated by his company and  these would deal with the pockets of low voltage being experienced in some areas.

    The company in a statement yesterday said Croucher appealed for patience by all customers of the company, saying that due to the decrepit equipment that the AEDC inherited, it would take huge investments, which his firm is committed to, and relatively long period before significant improvement in power supply would be achieved.

    He spoke when the FCT chapter chairman of the Manufacturers Association of Nigeria (MAN) Dr. Wasilat Shittu, led a team of officials of the group to meet with executive members of the AEDC in Abuja.

    The AEDC and MAN agreed to collaborate towards improving power supply to the various industrial sites in the Federal Capital Territory (FCT) and beyond.

    According to Shittu, many industrialists in Abuja and environ had refused to connect to the national power grid to avoid the damage that frequent interruptions in power supply could cause to their equipment.

    She said, however, that with the privatisation of the power sector and the “noticeable improvement” in electricity supply in the territory, MAN was encouraged to visit the AEDC to discuss the possibility of having “stable and quality” supply of power to their industrial sites.

    “We appreciate that it’s no longer business as usual. I was a civil servant and so when I talk about business as usual I really know what it means. However, we need assurance of greater improvement in supply so that more of our members would connect to the national grid”, she said.

    Croucher listed numerous high impact projects that the utility firm was executing to ensure a boost for power supply.

  • ‘Problems with electricity transmission lines’

    The Technical Panel on System Collapse yesterday told the Minister of Power, Prof. Chinedu Nebo, that the challenges bedevilling the nation’s electricity transmission line are natural and artificial.

    The panel’s Chairman, Fatai Olapade, said rainstorms and constant vandalism of the lines could be accountable for the frequent system collapses recorded in the country.

    Speaking after the inauguration of the panel by the minister in Abuja, Olapade said the Federal Government has stopped funding the Electricity Distribution Companies (DISCOs) and the Electricity Generation Companies (GENCOs).

    He said the Transmission Company of Nigeria (TCN) is underfunded.

    Olapade said: “At the same time, one thing we will realise is that the DISCOs are not being funded again. The GENCOs are not being funded again; even the transmission company is underfunded. These are all the areas we are also going into, besides the man-made and the act of God.”

    Prof Nebo had advised the panel to, within two weeks, determine the immediate and remote causes of system collapse.

    The minister urged the panel to review the system collapse that occurred from January till date.

    He also urged the panel to review the performance and effectiveness of the grid’s protection system within the period under review and recommend measures to further strengthen the protection mechanism.

     

  • Weak transmission, gas may hinder power supply

    Weak transmission, gas may hinder power supply

    Despite the improvement achieved in power generation, there is concern that if the Federal Government does not do something urgently to strengthen the transmission network, the aspiration to attain significant improvement in power may be a mirage.

    Vice President Namadi Sambo had directed the Niger Delta Power Holding Company (NDPHC) to ensure that contractors handling projects in the National Integrated Power Project (NIPP), which would add at least 4100 megawatts (MW), to complete them by end of the year.

    With generation from the assets of the Power Holding Company of Nigeria (PHCN) and independent power producers (IPPs), generation may hover around 10,000MW but there are fears that the transmission network will not be able to wheel between 4,500MW and 5,000MW.

    The distribution segment of the power value chain might not be a difficult area following the progress made so far on the government’s privatisation of the successor companies of the PHCN. FBN Capital in email, said the Presidential Task Force on Power (PTFP), noted that Nigeria’s power generation reached a peak of 4,517MW in December, last year (up from around 3,500MW in 2011). The PTFP set a target of 7,175MW for end-2013 three months ago. The goal is ambitious, but assuming it is achieved, transmission presents an inconvenient bottleneck in the near to medium-term.

    Gas supply has been an obstacle to operation of some of the thermal plants including those of NIPPs and PHCN but the FBN Capital said the improvement in power supply last year was driven by steady improvements in gas supplies and the completion of some gas supply projects such as the Escravos Lagos Pipeline, ELP- Olorunsogo permanent gas pipeline.

    It said the boost to gas supplies led to the coming on stream of some power plants under the NIPP, which were previously gas constrained, adding that NIPP projects accounted for the bulk of the increase in power generation recorded last year.

    FBN Capital noted: “The NIPP plants are important as far the government’s target for 2013 is concerned. In fact, it is not until 2014 and 2015 that we see Independent Power Plants’ (IPP) contribution becoming meaningful.”

    However, regardless of the additional improvements that may be recorded in fuel-to-power and generation over the next 12-24 months, transmission remains the weak link in the chain. Presently, the transmission grid is capable of evacuating just over 5,000MW, the research firm said.

    Canada’s Manitoba Hydro has been awarded the contract to manage and optimise the transmission infrastructure. However, significant funding is still required to boost the grid’s evacuation capacity, which ranges between $3 billion and $4 billion per year, it said.

    “At the end of the spectrum, distribution companies (discos) also have some infrastructure issues to contend with. However, the more experienced companies among those that were successful in bidding for PHCN assets can already see some low hanging fruits on loss reduction and collection.

    “Despite obvious challenges ahead, we believe that the realisation that the impact of the power reform programme on Nigeria’s economy has the potential to be far-reaching, even more than that of the telecoms sector, will keep the reform agenda alive,” FBN Capital added.