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Asset sale not the solution to sector problems
- The sales are more of a revenue drive
- NCP approved sale of five GenCo assets
Rumundaka Wonodi, the former Managing Director Nigerian Bulk Electricity Trader (NBET) has said, the sale of the National Integrated Power Projects (NIPP) Generation assets will not solve the sectors problems especially, in the short term.
“Selling the five out of the 10 power plants will deepen the reforms. But in the short-term, I do not think that it is going to make any difference in power supply” he said. The National Council on Privatisation (NCP) had recently approved the sale of five NIPP assets. They include, Geregu, Benin, Olorunsogo, Omotosho, and Calabar power plants.
Wonodi opined that the sale of the assets is more of a revenue drive by the Federal Government (FG). “It is also a revenue thing for the federal government, which has always shown that on the income side, the sale of these assets will boost government revenue” he said.
He urged the FG to look focus on making the sector attractive for business investments. Wonodi advised the FG to allow for a cost reflective tariff and frowned on subsidies for consumption. ”This is one of the things that we have done or we have not done very well, which is to provide subsidy for consumption rather than for production” he said.
Wonodi acknowledged the current hardship in the country and urged the government to stabilise the economy in order to attract investments. ”if you can attract manufacturing companies, then the economy will grow and the employed citizens will be more likely to pay N60 per kilowatt than the unemployed citizen who’s only willing to pay N10″ he said.