Why The Power Sector Is Not Making A Difference
BY MAYOWA MICHAEL ADELEYEThe simple reason why the current private operators of the buy-out PHCN power generation and power distribution assets have not done any meaningful improvement in improving Nigeria Power Supply is because majority of the private investors are obviously financially handicapped to raise and invest huge capital needed to turn-around
the PHCN dilapidated assets they bought from former NEPA over a year.
President Buhari as a matter of urgency, should meet up with the UnderPerforming GenCo and DisCo Private Investors to know precisely what capital investments they have put in on the dilapidated assets they bought from NEPA to know precisely new equipments installations they have put in place.
Power Generation is not “million of dollars” investment but from “billions of dollars” mega- investment onward. If the current investors could not raise billion of dollars to invest into their power corporations, they risk being bought over by very successful and reputable power generation and distribution companies with billion dollars net worth that can generate at least 20,000MW within 2 years time frame!
Taxing the consumers with more levies and bills to raise funds to invest into their business should not be an option at this point in time when power generation keep dropping almost on weekly basis. People need results to be encouraged to pay bills. Which of the private GenCos or DisCos that bought any of the PHCN assets in hundreds of millions of dollars each in 2013 have invested $1billion in Nigeria from 2013 till date? How many of the current financially handicapped investors can replicate the Dangote’s investment of over $2.5billion (N500b) in two submarine 500km gas pipelines that was signed recently?
Such heavy investment will be a great game changer to ensure that the Gas Turbine Power Generation locations are not deprived of Natural Gas to ensure uninterrupted power generation.
PMB does not need to waste time revoking the unperforming current power sector firms that could not raise heavy investment into their business, rather, sooner or later, all we hear is merger, acquisition and buyout of as many of the current power firms by multi-billion dollars power corporations.
This is what you get when you do not have the financial muscle of what you get involved in. This is billion dollars investment not million dollars or peanuts. Unfortunately for many ignorant people, when the capable multinational power sectors buy out many of these underperforming power sector firms, many people will raise noise and allege government is breeding monopoly.
They knew from the onset the dilapidated states of PHCN assets both in the generation and distribution and they knew quite well that they need to seek for at least $4bn to turn around the dilapidated assets bought over from NEPA to function at 100 percent.
They are aware of the hopeless situation pervading the sector in terms of raising funds and the brickwalls investors often confront in our clime. These must be the first priority and our consideration before being disgracefully sent packing out of business by more financially capable power investors.