- Head-on wholesale privatisation of the unbundled DisCos and GenCos in the power sector value chain was an unsuccessful move.
- Government should boost investments in the power sector
In an Interview with Channel news on Monday, the former Minister of Power and Steel, Liyel Imoke, described the power sector as a mix of social, private and investment sectors, adding that the investment component is essential to growing the sector. He recounted his tenure as the glory days of the power sector owing to the country’s power generation capacity increase from 1600MW to 4000MW. He attributes this success to the strong support and political will of then President H.E Olusegun Obasanjo.
Imoke regretted that work on National Integrated Power Project (NIPP) initiative created to promote investments in the power sector had become very bureaucratic. He attributed project delays to false accusations of alleged fraud to the tune of $16billion, causing some projects in his tenure to linger for about two to three years, significantly impacting the projects as the proposed cost increased in multiplies from about $2-$3 billion to over $10 billion.
Imoke said the steps to unbundle the power sector brought revenue to the Federal Government. However, at the end of Presidents Obasanjo’s and Yar’adua’s tenures, subsequent governments embarked on wholesale privatisation of the unbundled DisCos and GenCos in the power sector value chain. He added that Nigeria, the first country to completely privatise its GenCo’s and DisCo’s, is faced with reversing privatisation deals. He described wholesale privatisation as an unsuccessful move that could have excelled if the privatisation was done gradually and with the most viable Discos—Ikeja, Lagos and Abuja given top priority.
In conclusion, Imoke attributed the high cost of power to low external investment in the on-grid sector, which could compensate for the internal investment in the sector. Therefore, He recommended the government could boost investments and expand the sector by driving competition in the market and enforcing solid regulations to protect consumers and investors.