WITH the increased demand for electricity fueled by population growth and rising urbanisation in the country, stakeholders in the power sector have said that the Distribution Companies, DISCOs, lack the capacity to wheel 6500 megawatts (mw) of electricity transmitted to them.
The Federal Government plans to double generation capacity from fossil-fuel sources to more than 20 Giga Watts, GW and to increase hydroelectricity generation capacity to 5.7 GW by 2020 from the current 1.9 GW. Speaking during the sixth edition of Power Nigeria Exhibition in Lagos, Head of Energy Research, Ecobank Group, Mr. Dolapo Oni, said the DISCOs need a long term funding to enable stability in the sector.
He stated: “Where bulk of the problem lies in the sector is on the distribution end. Even though we have 6500 mw that can be generated today, the DISCOs can only take 3700mw, they turn down over 2000mw on a daily basis. They feel they are going to lose a lot of money if they take the electricity that’s being transmitted to them. They are also worried about customer paying for it, as well as how much they are going to lose in terms of their own distribution infrastructure. “Funding of power as a structure in any country requires a long-term funding.
The problem we are facing today as a nation is that we channel short term fund to the sector, like five to seven years funding, which is a mismatch. When you combine the fact that you don’t have the right kind of tariff in place that will give you back your expenditure, it becomes difficult for you to attract the kind of funding needed in the business.” Managing Director, Transmission Company of Nigeria, TCN, Mr Usman Gur Mohammed, noted that the exhibition plays a key role in promoting the latest products and solutions both locally and internationally, while putting the spotlight on issues such as solar power and energy efficiency. He stated: “Although we are making good progress toward a more stable power market, such as the recent announcement of the Building Energy Efficiency Code (BEEC), we are still have a long way to go.’’