Friday, 9 October 2015

Power Sector REFORMS that Unbundled PHCN and much more...

Problem: Lack of investment in the power sector and stalled expansion of Nigeria’s grid capacity over many decades led to low and erratic electricity supply. This stifled growth, increased the cost of production and frustrated citizens.

Reform Actions:
Road Map for Power Sector Reform
Presidential Action Committee on Power
Presidential Task Force on Power
Unbundling of the Power Holding Company of Nigeria
Strengthening of the Nigeria Electricity Regulatory Commission
New Tariff Regime
Consumer Assistance Fund
Reform of the Rural Electrification Agency
Contracting out and Privatisation of New Business Units (Transmission Company of Nigeria, Generation Companies, Distribution Companies, and the Nigerian Electricity Liabilities Management Company).
Improvements in Power Generation
Improvements in Transmission and Distribution

Main Achievements: The unbundling of the Power Holding Company of Nigeria (PHCN) and privatisation of power generation and transmission after many years of unsuccessful attempts remains a significant achievement. Power generation has improved from 2,800MW in 2011 to 4,517MW in 2014. The reforms have also reduced the cost of governance, as government is no longer saddled with huge cost outlays incurred before privatisation. Corruption that was hitherto rife on estimated bills, ghost workers, and inflated contracts is no longer a big issue.

Key Challenges: 
(a) low level of electricity supply to the citizens; 
(b) inadequate gas supply to the power stations; 
(c) inadequate funding to support massive investments required in the sector; 
(d) frequent acts of sabotage and vandalism in the sector; 
(e) long-drawn labour disputes following privatisation exercise; and 
(f) sustainability issues. 

Reference:  Public Service Reforms in Nigeria (1999-2014) - A Comprehensive Review

Click to view Compendium 

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