Speech Delivered By H.E Babatunde Raji Fashola, SAN At The National Council On Power On Thursday 21st September 2017 In Jos, Plateau State
I welcome the opportunity to speak to you at this year’s National Council on Power, holding in the famous city of Jos in Plateau State.
Mining, Agriculture, the High Altitude and Climate, Tourism and brands like the Hill Station Hotel, The Rock Beer are some of the very proud heritage that have put Jos city on the global map.
This city of Jos is also famous for its contributions to Nigeria’s power history, through NESCO, the first privately run Power service in Nigeria that started producing power since 1920s, before the ECN (which became NEPA and PHCN.)
We have recently admitted NESCO to our monthly meetings and I believe we have something to learn from them.
I thank the Governor and the Government for their good work in ensuring that this conference holds despite the recent threats to public peace and order.
The proactive statements and actions have shown that Plateau state Government takes its primary responsibility of safety of lives and property very seriously.
I am also pleased to inform you that TCN has a major transmission sub-station in Panskshin in this state which will improve power service when completed. I have previously visited that site and our monthly power meeting gets periodic progress updates.
The sustenance of peace and order are critical to the completion of this and service delivery.
Ladies and Gentlemen, the theme of this Year’s council meeting on power is not accidental. It is deliberate and purposed. The theme is “Completing the Power Sector Reform.”
It follows logically and sensibly from last year’s our achievements at last year’s meeting, the highlight of which was to launch the country’s energy mix, to diversify our energy resources beyond gas and hydro to coal, solar and other sources.
That is already bearing fruit as we are gradually seeing an increasing foot- print of solar power systems especially at mini and off-grid levels and many more are afoot.
And as is now well known, this Government has finally approved the award of the 3,050 MW Mambilla hydro power project after over 40 years of starts and stops.
The solar foot print is growing slowly but surely, not just because of what the FGN is doing but because of what Nigerians are doing in their states, and this is why this theme at this meeting was chosen because all the states are expected to be represented here.
Let me set the context by once again reminding all of us that the power sector has been privatized and is largely in the hands of the private sector. Therefore, the work that needs to be done is largely the responsibility of the private sector.
Our role as governmental institutions at Federal and State levels is to implement the laws, enunciate Policies and take actions that help the private sector play its part effectively.
Our roles in this regard are well set out in the Electric Power Sector Reform Act 2005 pursuant to which the privatization of the power sector took place. That law, which I urge everybody to read, clearly sets out my role as minister which is to administer the Law in section 100.
As we are all aware, there have been comments about how effective privatization has been in the power sector and some people have called for its cancellation which I disagree with.
However, I agree that there are problems, I understand that 4 (FOUR) years post privatization is a transition period, and some more work needs to be done before the expected benefits of privatization come to fruition.
That is why we developed the Power Sector Recovery Programme (PSRP) which are a set of policies, programmes and actions aimed at solving Generation, Transmission, Distribution, Liquidity, Metering, Estimated Billing, Energy Theft, Safety and other challenges.
While we are beginning to see results of increased generation up to 7001MW on 12th September 2017, Transmission up to 6,700 MW and Distribution 4,600, it is not yet enough.
The theme of this meeting therefore provides opportunity to share with state representatives and other participants what the PSRP is about.
Let me state emphatically that everything in the PSRP is based on the 2005 Law and that is why I urge everybody to read it.
So, the N701B payment assurance guarantee which has driven up power Generation is consistent with Section 76(2)(b) of the Law which seeks to ensure that producers of power recover their investment and some profit.
Similarly, the constitution of the Board of NERC another objective set under the PSRP is a requirement of section 34 of the law, while efforts being made by NERC to;
a. Develop a new multi- year Tariff order Template
b. Develop regulations for meter service provided, meter Franchise operators
c. Develop regulations for Eligible Customer
are requirements of Section 76; 67(1); 68(2) and 100 of the Law.
The issuance of mini-Grid Regulations by NERC in August of 2017 to allow people provide their own power from 1KW-1 MW and ease the pressure on grid distributed power and improve access to power is a requirement of section 62(2) of the Law.
The constitution of the Board and management of the Rural Electrification Agency by President Buhari in March 2017, to deepen access of Rural communities to power and champion deployment of Solar Power is in accordance with section 88(1)-(4) of the Law.
Ladies and Gentlemen, these are some of the reform actions contained in the Power Sector Recovery Programme being undertaken at Federal Government level.
But there are other areas of Reform where progress will be defined by what happens at the state and Local Government and this is one of the reasons why we chose to discuss this theme at this council where all the states are represented.
For example, out of the estimated MDA debts of about N90Billion claimed by the DisCos, only about N27Billion has been verified as debts owed by the FGN.
There are invoices which show that other parts of the debt are attributable to service points at States and local governments.
I will urge first that states and local governments insist that their buildings are metered so that they can budget for and pay for energy they use. It will turn out to be cheaper than diesel generated power.
It will also help reduce loss of income by DisCos.
Furthermore, I urge state Governments to set up small teams with audit capacity to verify debts owed by them and their local governments, ascertain the quantum and develop a payment plan which can then be budgeted for. This will help to reduce the liquidity issues and contribute to the reforms.
More importantly the challenges of inadequate power manifests itself in households, businesses, service centres and other points of need that are located in states and local Governments.
Therefore, the impact of insufficient power is manifest at municipal level and so will be the benefit of improved power.
Therefore, it is only logical and necessary for states and local Governments to own and participate in the implementation of the 2005 Law and the PSRP.
Therefore instead passing votes of no confidence in the DisCos who serve them, I will urge that they take a more important role of engagement and consultation to help the DisCos serve them better.
Communities and states who want to see improved power must also sacrifice and contribute some of their land for this service to be provided.
The land will not finish but the prosperity that comes from better power will only help improve the quality of life, the value of their land and the use of their land.
Ladies and Gentlemen, the list of things that states can do to help improve power supply, reform the sector and implement the 2005 Law and the PSRP are only limited by imagination.
I will conclude by urging states to pay more attention to the provision of the Law, the PSRP, and to consult with the ministry and NERC should they need clarification.
I hope that when we meet next year, all states will be in a position to report actions taken, progress achieved, improved power service and better value, for attending this year’s National Council on Power
Thank you.
Babatunde Raji Fashola, SAN
Honourable Minister of Power, Works and Housing
Thursday 21st September 2017
