Blackouts over gas shortage raise fresh concerns
By Ejim Michael
Kanempress News
30th January 2024
Blackouts in parts of Nigeria due to gas shortage to generation plants have raised fresh concerns about the perennial challenges facing the nation’s power sector.
Kanempress recalled last weekend that the Federal Government and Transmission Company of Nigeria blamed the drop in electricity supply to Nigeria in recent weeks on gas constraints.
Months back, the government also blamed gas shortage for reduced electricity supply by Niger Delta Power Holding Company (NDPHC) to electricity distribution companies.
Nigeria’s electricity supply relies on 26 nationwide hydro and gas-fired power plants.
Nigeria’s available electricity generation capacity has hovered between 3,000MW and 5,000MW since the sector was privatized in 2013 for a population of over 200 million.
According to the latest data by the Nigerian Electricity Regulatory Commission, ten years after the sector’s privatization, it faced challenges to improve despite spending N3.348 trillion on electricity subsidies.
Nigeria plans to spend another N1.6 trillion on electricity subsidies in 2024 asides the heavy spending on the sector, Nigeria’s power industry is bedevilled by a lack of investment, electricity policy enforcement, regulatory uncertainty, gas supply, transmission system constraints, and significant power sector planning shortfalls in recent years.
NERC’s third quarter 2023 report said gas constraints remain a significant challenge to the country’s national grid.
Speaking to Kanempress, Bolaji Tunji, special adviser, strategic communication and media relations to the Minister of Power, Adebayo Adelabu, said the federal government has moved to resolve the gas constraint challenge for GenCos.
According to him, the government has begun engaging stakeholders to tackle the challenges, including paying debts owed to GenCos.
“The Minister is doing everything to resolve the challenge, including payment of debts owed to Generation Companies and other stakeholders within the value chain,” Tunji- said.
“I can assure you that the Minister is tackling the gas shortage challenge to generation plants”, he said .
Meanwhile, the Association of Power Generation Companies, APGC, said it was unaware of an engagement by the federal government with GenCos to resolve the gas shortage issue.
It, however, noted that the government may have initiated steps to resolve the gas shortage issue affecting the Nigerian Electricity Supply Industry, NESI.
The the Association of Power Generation Companies
noted that a solid contractual regime between the government and GenCos, with bankable guarantees and full payment from off-takers, is a silver lining to Nigeria’s power sector challenge.
“It is possible they are engaging the GenCos on a firm contractual regime with bankable guarantees and full payment from off-takers”, it said.
