General Electric, GE, has described Nigeria’s electricity infrastructure as inadequate, ageing and degraded, a situation that is responsible for the current power crisis in the country.
According to a paper titled:“How Do We Harness Electricity to Transform Social Infrastructure?” by Mr. Lazarus Angbazo, President & Chief Executive Officer, CEO, General Electric Nigeria, the country’s power sector is bedeviled by inadequate generating capacity and inadequate gas supply.
He further stated that the transmission facilities are ageing and degraded, while the distribution facilities, comprising meters, transformers amongst others, are grossly inadequate.
He noted that vandalism of critical infrastructure, human capital issues, sector liquidity, and legacy debt overhang are some of the other challenges confronting the country that are also hampering the steady supply of power.
Despite the challenges, Angbazo, however, argued that there are a number of opportunities in the Nigerian power sector, ranging from the strong reform agenda of the Federal Government, the huge power demand in the country to the planned Nigeria Gas Master Plan.
He cited other opportunities in the sector to include the domestic gas obligation policy, the potential in the Petroleum Industry Bill, PIB, and the abundant fuel sources for alternative power generation.
To harness the opportunities in the power sector, especially in the generating segment, Angbazo recommended bolder, faster investment decisions, and the diversification of the generation base, while also increasing the capacity of the Nigerian Bulk Electricity Trading Plc.
He also called for the fast tracking the Gas Master Plan, and the tracking of progress of the power reform.
On the transmission side, he advocated an acceleration of the ongoing grid upgrade, promotion of private sector investment in national grid and a comprehensive human capacity and skills development programs.
Also, Mr. Batchi Baldeh, Senior Vice President, Power, Africa Finance Corporation, AFC, said the potential debt financing opportunity for the National Integrated Power Projects and Independent Power Projects, IPPs, is US$6.22 billion (N995 million), excluding capital expenditure, of the US$8.886 billion (N1.421 billion) financing required.
He noted that an additional US$5.758 billion (N921.28 million) is required for the former Power Holding Company of Nigeria, PHCN generating company assets for capital expenditure and operating expenses over the next five years.
He identified other investment and financing opportunities in the sector to include, “Follow-on investments in PHCN assets, NIPPs transaction, IPPs, embedded generation as the sector becomes fully liberalized; distribution infrastructure and ancillary services (metering, billing, engineering services, software, others)
“Other opportunities in the sector are in Transmission and Independent Electricity Distribution Network (IEDN); gas development, supply and transport infrastructure; manufacture of wires, cables, transformers, and other auxiliary equipment.”