Government’s approach to power sector crisis seen as hypocritical

BY OLUSOLA BELLO

President Muhammadu Buhari was last Wednesday forced to offer what many analysts considered a needless apology when he was jolted to suddenly realise the economic quagmire his government’s mishandling of the country’s fuel and power problems has put Nigerians.

The prolonged shortage of petroleum products and the collapse of the national grid have brought untold hardship on Nigerians.

The president’s apology is seen as needless, analysts say, because if the government it has put in charge of these key and important sectors of the economy know what they are doing, Nigerians would not have found themselves in this sorry state of paralysis occasioned by lack of fuel and power.

If Nigerians have been managing blackouts before now, because the Transmission Company of Nigeria cannot wheel more than 4000 megawatts despite the claim by the minister of power that Nigeria has installed capacity of 18,000 MW and daily generation of 8,000 MW, the recent system collapse has exposed them to more hardship

However, these twin problems of lack of power and fuel are not new to Nigerians. The government is aware of the problems with power and fuel, but has demonstrated incompetence in many areas of our national life. Now, these problems are staring everyone in the face because of negligence and arrogance on the part of government officials.

Take the issue of power, especially the issue of the recent grid collapse that has gripped the nation like an epidemic. One of the major causes of grid collapse is lack of gas for the generating companies to provide the minimum frequency stability on the grid. If generation is low, the grid would be destabilised. There have been series of calls by generating companies that the government should intervene in respect of the debt owed them by electricity distribution companies so that they can have enough cash to pay gas suppliers, but the government pretended not to hear their cries.

Now the bubble has burst, the government is adopting a fire brigade approach to resolve the issue. Such an approach, used in the past, never provided a lasting solution.

Recently, the Transmission Company of Nigeria (TCN), in a statement signed by Ndidi Mbah, general manager, public affairs, stated why there is load shedding all across the country. Mbah listed some of the power generating companies and their generating profiles in the last two months, but most of the power plants that are not working optimally are owned by the government.

A summary of the power generating profiles in the last two months, for instance, clearly shows that 14 gas-powered generating stations were either not generating at all or had limited generation at various times within the period, further depleting the quantum of power generation available for transmission into the grid on a daily basis. Power generating stations in this category include: Omotosho units 5 & 6, Olorunsogo units 3, 4 & 6, Omoku units 3 & 6, Omotosho NIPP units 3 & 4, Delta units 15, 17, and 18, Afam VI units 11 & 12, Olorunsogo NIPP unit 3, Ihovbor NIPP unit 2, Sapele Steam unit 3, Sapele NIPP unit 1, Odukpani NIPP units 1 & 3, and Okpai units 11, 12 & 18. The situation with these plants has had a profound effect on the grid system.

Also, within the same period, Jebba Hydro and Shiroro Power Generating Stations were either out or had limited generation, causing additional loss of 232MW from the grid, while other power generating plants such as Omotosho units 3&4, Olorunsogo units 1, Delta units 10 &20, Afam VI unit 13, Ihovbor NIPP units 4, Geregu NIPP units 22&23 and Odukpani NIPP units 2, 4 & 5, have also been out either on fault or for scheduled maintenance, causing a further loss of about 3,180MW from the grid.

A combination of the above scenarios has persisted and the total effect on the grid has been persistent low generation, which TCN operators have had to strive to dispatch in a way that will not jeopardise the stability of the grid.

More recently, from the 1 March to 4 March, 2022, there was generation shortfall due to water management in Shiroro and Jebba hydro with the loss of 307MW and 125MW, respectively, from both stations. Within the same period, there were fault and technical problems in Egbin, causing 514MW shortfall and in Geregu, causing 230MW shortfall; while a reported fault at Alaoji NIPP reduced generation from the substation by 263MW.

“Gas constraints alone in the Olorunsogo gas generating plant reduced generation from the station by 104MW. In the same vein, Omotosho gas lost 102MW and Sapele NIPP lost 263MW. In Omotosho NIPP, there was a generation shortfall of 233MW and in Omoku, a shortfall of 112MW. Two units in Okpai have limited generation due to technical problems causing a 204MW drop in generation and in Afam VI, [there was a] 511MW drop in generation.

“Gas constraint and fault in Olorunsogo NIPP reduced generation by 240MW, Geregu NIPP by 435MW, and Ihovbor by 142MW. Also, due to gas pipeline pigging, Odukpani NIPP was shut down, which caused a reduction of generation by 575MW.”

Government cannot claim not to be aware of these problems. But the typical lack of duty of care on the part of Nigerian leaders has brought the nation to this state. It was only when the national hardship became aggravated by lack of electricity and fuel that the president, on a foreign medical trip, had to start apologising.

The Association of Power Generation Companies (APGC) has also said that illiquidity, caused by the huge sums owed GenCos by the Nigerian Bulk Electricity Trading Plc (NBET), has more than ever, continued to frustrate the GenCos and kept them incapable of meeting their obligations which are extremely necessary to keep their power plants running and make capacities available.

“Such obligations include our operations and maintenance (O&M) as and when due, procurement of critical capital, spare parts and accessories, payment, and servicing of existing loans from lenders and financiers, employee obligations,” APGC said.

According to Joy Ogaji, executive secretary of the association, most of the electricity generated in Nigeria, about 80 percent, comes from gas-fired turbines. Natural gas is the feedstock or fuel of these plants. GenCos have consistently been dealing with unending gas-related challenges, which inhibit optimal generation.

“Issues of gas volume, gas quality, gas pressure and gas transportation have consistently curtailed capacity utilisation by GenCos, thereby affecting generation. These issues need to be addressed urgently too, as GenCos have always requested.

“Unfortunately, the unenforceable state of the contracts in the NESI and the broken cycle of payment assurance has made the enforcement of what would ordinarily be basic obligations of parties to the industry agreements, impossible,” Ogaji explained.

President Buhari who spoke about the issue of power outages witnessed recently in various parts of the country, said: “The blackouts seen in the national grid are also being addressed,” he assured Nigerians. “A dip in hydroelectric generation due to seasonal pressures has coincided with technical and supply problems at thermal stations.

“On this, the government is also working tirelessly to resolve the issues at the latter to guarantee sufficient power flows into the national grid,” Buhari said.

As part of emergency measures put in place following a meeting convened with key stakeholders to address the low power generation in the country, the president said the main challenge was identified as being one of low gas power generation, as a result of sabotage of gas pipelines leading to the shutdown of power plants coupled with routine maintenance on other gas power plants.

To recover over 1000MW, he said actions were agreed upon between the players in the Nigerian Electricity Supply Industry (NESI) and NNPC Limited.

According to President Buhari, the actions targeted the National Integrated Power Project (NIPP) plants, Niger Delta Power Holding Company (NDPHC), and power plants run under NNPC Joint Ventures, Agip and Shell (NAOC and SPDC), respectively.

He explained that progress on the key actions has already ensured the restoration of 375MW to the grid after the pipeline from “Okpai 1” was repaired.

To also ramp up the underutilised capacity of the NDPHC, he said a $50 million gas supply agreement was being finalised to secure the sustainability of up to 800MW of underutilised NIPP assets.

A major question has been raised by what is now clearly being seen as a fire brigade effort. Why did the government wait for the country to experience such a horrific situation before saying that it would address the issue of gas to the NIPPS?