World Bank: Nigeria’s Power Deficit Hits 94,500 Megawatts

World Bank

Nigeria’s power generation deficit has touched 94, 500 Mega Watt (MW) mark, New Telegraph has learnt. This disclosure, which was made by the World Bank in a document obtained by this newspaper, came as $3.5 billion annual investments’ dearth rocked the sector, putting the 20,000 MW target by 2020 in jeopardy.

Nigeria had, in 2010, cut its year 2020 target from 40,000 MW to 20,000 MW when it discovered that it was impossible to meet, expecting to achieve the new target with fresh $3.5 billion annual investments in the sector. Less than 45 per cent of the populace connected to grid had recently witnessed temporary stability in supply in some parts of the country owing to improved generation from hydro plants.

Over 95 million of the Nigerian population, the World Bank document showed, are, however, still without on-grid electricity, even though checks showed reduction of over 23 million generators’ importation due to the on-going recession. About N1.6 trillion was spent to fuel the over 60 million generators imported into  the country in 2006, former Director General of the National Planning Commission (NPC), Ayodele Omotosho, told lawmakers at a two-day public hearing by Senate Joint Committee on National Planning, Economic Affairs and Poverty Alleviation, and Finance.

Nigeria currently consumes 126 kwh/person, the document showed, adding that “an equivalent power consumption level for Nigeria, given its population, would be 98,000MW.” Nigeria, which System Operator data showed, generates an average of 3,500 MW daily, has an estimated population of 178 million people, according to the World Bank’s 2014 Statistics on Nigeria.

This shows a power supply deficit of 94, 500 MW. The Federal Government previously set for itself a target of generating 40,000MW within a 10-year period, starting in 2010.

This seemingly modest target for generating capacity alone, according to government’s Roadmap for Power Sector Reform, will require an investment of $3.5 billion per annum over a 10-year period. Considering the entire value chain that includes generation capacity, transmission and distribution, the effort, further checks showed, require $10 billion per annum over 10-years. Nigeria’s 2016 Federal Budget is $21.3 billion.

Therefore, the yearly cost to achieve what is in fact a very modest goal of 40,000MW over a 10- year period equals a one half of the country’s annual budget. The 2016 federal budget proposes the sum of $1.4 billion for power sector capital expenditure, $2.1 billion less than the $3.5 billion expected investment. Additionally, owing to missed milestones and exigencies, the initial target of 40,000 MW by the year 2020 has also been revised down to 20,000 MW.

“Nigeria currently consumes 126 kwh/person while its equivalent power consumption level given its population would be 98,000MW,” the World Bank document stated. “When compared to South Africa, which has a population of 53.6 million and an installed generating capacity of 44,000 MW of electricity, the scale of the challenge facing Nigeria begins to come to the fore.

More so, given that South Africa’s current electricity consumption per capita is approximately 4,800 kwh/ person/year. Though this is a rough estimate, it, however, confirms the severity of the power generation gap in Nigeria.”

Nigeria, the global bank said, presently “has an installed power generating capacity of 12,522.0 MW, available operating capacity of 3,879 MW and transmission capacity of 5,300MW. “Owing to gas supply problems, significant transmission & distribution losses, a lack of maintenance, infrastructure sabotage, and poor water management only 1,864 MW or 25 per cent of installed capacity is distributed  to consumers per the Nigerian Government’s own data.”

Aside this, this newspaper gathered that the transmission and distribution network are also threatening to be major setbacks. On the 31st of March 2016, the power sector suffered a system collapse, which resulted in a national grid output of zero megawatts of power for a three hour period. “When grid power is available, only 45 per cent of Nigerians have access to it, but much of that supply is epileptic and of very poor quality,” the document stated.

The report estimated that at a minimum, 6000 MW is generated using petrol and diesel generators. This mode of selfgeneration represents a financial albatross on Nigerians equivalent to between $6.7 and $10.47 billion compared to grid-based power.

This is besides the premature deaths and chronic ailments resulting from breathing polluted air. Although government’s privatisation effort was a step in the right direction, with the backdrop of falling oil revenues, it cannot shoulder the financial responsibility on its own.

Source: New Telegraph

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