OIL & GAS

Nigeria aims at 16,000 megawatts of electricity by 2013
03/21/12, Biodun Omojola

The Nigerian government is set to invest N880.9 billion to generate 16, 000 megawatts by 2013. This is according to the Vision 20:2020 implementation document issued by the country's National Planning Commission. The proposed investment will cover four key areas including power generation, transmission, distribution and alternative energy. The document says the overall target is to increase electricity generation, transmission and distribution from the less than 4000 megawatts now to 16,000 MW by that date.

The document says that "Access to electricity is expected to increase from the current 40 percent to 50 percent while per capital consumption will increase from the current 125kwh to 500kwh over the planned period." The document further states that "increase is expected to be achieved through significant investment in rural electrification programme that will facilitate the expansion of transmission and distribution lines to a majority of rural Nigeria".

On alternative energy technology, it said this will be developed from coal and other renewable energy sources, such as solar, wind and biomass, especially for the electrification of rural communities. "In order to achieve the medium term goal, government will continue regular maintenance of all power infrastructures, rehabilitate and complete all ongoing power projects. Incentives for private sector participation through accelerated implementation of the Power Reform Act will also come into play.

Nigeria has been battling with the insufficient power supply for years now. Part of government's effort to provide adequate power supply is the proposed privatisation of the power utility company, Power Holding Company of Nigeria (PHCN). Already the power monopoly has been unbundled preparatory for wholesale privatisation. Government is also keen to increase cost of electricity to PHCN customers to make the sector more attractive to investors. The increase, up to 88 percent, may come as early as April as part of the reform to revive the power sector and attract outside investors.

Under the new pricing regime, tariffs will rise between 25 percent and 88 percent between different classes of users with most customer classes expected to see a 50 percent hike in their monthly bills. Minister of Power Barth Nnaji, said government is planning to cushion the effect of the increase in power rates for the lowest-income consumers. "We are making sure that the urban poor and rural.