Power grid reduces to 3,530MW as rationing continues statewide

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Despite gas supply issues and a bleak financial future, power supplies across the country remained stranded over the weekend as the Federal Government’s efforts to increase national grid supply failed to yield results.

Checks on national grid data supplied by the Independent System Operator revealed that as of 3pm yesterday, just 16 of the country’s power plants were generating to the grid at 3,530.33 Mega Watts, with Nigeria’s largest power plant, Egbin Power, entirely off the grid.

The three largest generators were Azura-Edo IPP (420MW), Kainji Hydro (415MW), and Shiroro Hydro (275.73MW).

Gas providers have so far rebuffed government requests to expand supply to power plants, citing a debt of more than $1.3 billion for previous supplies.

The government committed at the beginning of the year to pay N1.6 trillion in electrical subsidies to the Nigerian electrical Supply Industry, NESI, but the budget only included N450 billion.

The Minister of Power, Chief Adebayo Adelabu, revealed last week that no payment had been issued for the month of January, exacerbating the industry’s cash crisis.

The Minister stated, “The persistent liquidity issues arising from an inappropriate tariff regime, poor collections, and insufficient funding of government subsidies, resulting in massive debts owed to transmission, generation, and gas supply companies.”

“This has limited the investments required to maintain supply flow, expand capacity, and upgrade infrastructure. It has also deterred financial institutions from lending to the industry because sectoral activities are not bankable, making the sector unappealing to prospective investors.”

He noted that some of the measures under consideration by the government include “settlement of existing sectoral outstanding debt obligations to gas supply and power generation companies using partly cash payment and guaranteed debt instruments.” Current obligations to the GenCos total N1.3 trillion, with legacy debts of $1.3 billion.

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In a statement, the Abuja Electricity Distribution Company (AEDC) said: “We would want to inform you that we are aware of the erratic power supply experienced in recent times, which is mostly due to insufficient power allocation to us.

“This has forced us to impose load reduction instructions across our franchise to manage the situation and ensure grid stability. This will entail occasional temporary interruptions of power delivery to certain places for a limited time. We understand the inconvenience and sincerely apologize for the disturbance. “We are working hard to reduce the impact of these outages.”

Also, the Ibadan Electricity Distribution Company, IBEDC, warned its consumers that “the current drop in electricity supply is due to generation shortfall as a result of gas shortage to generating companies.”

“We are collaborating with stakeholders in the electrical value chain to develop a sustainable solution. We sincerely apologize for the inconvenience and ask for your patience,” it said.

Meanwhile, the European Union has announced that it will invest 37 million euros in the power sector. It stated that this sum is in addition to the $200 million in grants funded in the sector since 2008.

The EU Ambassador to Nigeria, Samuela Isopi, revealed this during a visit to the Minister of Power, Chief Adebayo Adelabu. He stated that the funds would be used to fund small hydropower, solar for health care facilities, rural electrification with isolated and interconnected mini-grids, and a circular economy in the power sector project.

In his response, Chief Adelabu identified liquidity as the primary challenge in the sector, which the government is working hard to address, adding that the market will only be sustainable and efficient if a cost-reflective tariff is in place.

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While appreciating the EU for its support for the industry, he pointed out that the EU projects are consistent with the Ministry’s sector plan. He committed to collaborate with the EU on their projects, particularly on small hydro and state electrification under the new act.

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