The Minister of Power, Works and Housing, Babatunde Fashola has said that in view of the budgetary approvals and financing, there are indications that the Federal Ministry of Petroleum Resources can build critical pipelines to transport gas to the power plants to increase power by 2,000 Mega Watts (MW) in the next 15 months.
While unfolding government’s plan for the power sector in Abuja on Tuesday, the former Lagos Governor said “Subject to budgetary approvals and financing, the ministry of petroleum indicates their ability to build certain critical pipelines to tranport gas to the power plants that will add another 2,000 mw to our stock of power within 12-15 months.”
He also mentioned some critical projects that needed funding for completion to include a 10MW wind energy project in Katsina nearing completion, a 215MW plant in Kaduna and the 3,050 MW plant in Manbilla Taraba State.
He confirmed plans to liquidate verifiable and agreed debts that have been accumulated, and approve a market tariff through which it could make the electricity distribution companies more efficient and committed to a fair metering system .
He said government had directed the Nigeria Electricity Regulatory Commission (NERC) to work out a fair market tariff and make it public upon conclusion.
According to him, the Federal Government will increase the current official electricity tariff for manufacturers in order to boost their power supply.
He asked the Governors to identify and enumerate their most populous industrial and commercial clusters where manufacturing, fabrication, welding and related productive work is going on especially by small businesses and to see how government can use the existing Legal framework to attract embedded power supply to these people who must be ready to pay for the power.
The minister said that “in such cases, the tariff may be higher than the current official tariff, but it will be many times a significant improvement on what they have and we will need the collaboration of the Discos to achieve this.”
On debt and tariff, he said “What we expect to do is to liquidate verifiable and agreed debts that have accrued, approve a market tariff and hold the discos to a more efficient and fair collection system based on the use of meters, eliminate so that consumers pay for only what they use.
“The Regulator, NERC, has been mandated to work out the fair market tariff and announce them when they are finalised.”
He emphasized that government will now boost the local meter production, sale, repair and maintenance industry to create jobs for the citizenry.
“We expect that this to aggressively energise the local meter production, sale, repair and maintenance industry and create spin off jobs for our people.
” We expect to see the growth of meter recharge small businesses like we saw in telecoms recharge cards and telephone hand set sales,” he said.
The minister urged governments live by example by paying their electricity bill debts and whenever they consume power.
He added that “Our ministry intends to champion this at the Federal Level and I hope that the State Governors, heads of parastatals, National and Sate Assemblies, the various State and Federal Courts, Local Governments, Military, police, and other related security agencies will find this a worthy undertaking to join and ensure payment of all their electricity bills.
“I cannot imagine any government today not paying for airtime for telephone use. The truth is that is we don’t pay that business will collapse.”
Fashola said that topmost in government’s priority for the power sector was to is to get contractors to finish on-going transmission contracts to enable us transport the power being generated to the Discos to distribute.
According to him, in 2015, the total budget for the power ministry was N9.606 billion. Out of this, he said, N4.476 billion was for recurrent expenditure to cover salaries and overheads, while N5.130 Billion was for capital expenditure, supposedly for on-going projects.
Continuing he said that “This was a significant under-provision, even if it was to complete only 22 of the 142 (one hundred and forty-two) transmission projects I mentioned earlier estimated at over N40 billion.”
On gas, he noted that there are a number of issues that beset the gas sector such as the environmental issue and the availability of gas infrastructure such as pipelines and the issue of pricing which are all the responsibility of other Ministries.
Low pricing, he said, is affecting the gas to power, stressing that gas vendors would naturally prefer international corridor that offers $4:00 per unit of gas to the local market of $1.30 per unit.
According to him, now the amount of power that is available is slightly larger than the capacity which the transmission network can support.
Fashola maintained that government was budgeting to carry power from generation companies to the distribution companies.
The minister said “We have identified a total of 142 projects of which 45 are at 50% level of completion and about 22 can be completed within a year.
“The budget estimates are known and we intend to aggressively pursue completion to increase the carrying capacity from the Gencos to the Discos.
“From there, we must expand the carrying capacity to run ahead of the generating capacity so that in future there will always be capacity to carry whatever power is generated.”