Uche Usim, Abuja
Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed on Monday pushed for quicker deregulation of the power (electricity) sector, as the current situation is forcing Nigerians to pay more for power.
Speaking at the inauguration of the re-constituted Board of Nigeria Bulk Electricity Trading Company (NBET) in Abuja, the Minister said: “electricity deregulation is still evolving in Nigeria, and the country is basically learning as the privatized market evolves. However, we do not have all the time, as the longer it takes, the more costly it is financially for Nigerians and the country at large.”
She, therefore, urged members of the new board to work assiduously to ensure that their tenure in the transitional market trading arrangement brings good tidings to the country.
Ahmed noted that the new board was necessitated by the challenges of the power sector, particularly with regards to NBET achieving its mandate.
“We have all come to better understand the role of NBET as the manager and administrator of the electricity pool in the Nigerian Electricity Supply Industry (NESI), and how it buys electricity from the generating companies (GenCos) including Independent Power Producers (IPP’s) under Power Purchase Agreements (PPAs) and resells it to the distribution companies (DisCos) via vesting contracts.
“The role of NBET in the stabilisation of the power sector cannot be overemphasised as it plays a key role in the generation of market confidence through well-negotiated and well aligned contracts with fair risk allocation that protects market participants from credit and systemic risks. NBET stands as a de-risking agent in the power industry as it acts as a credit worthy off-taker of power procured from Gencos in the absence of bi-lateral contracts between Gencos and Discos,” she stated.
The Minister noted that the contractual obligations and guarantees that NBET issues and manages were of strategic importance in the repositioning of the sector and delivering the desired benefits to Nigerians, in line with the mandates of NBET.
Ahmed, who is the Chairman of the Board, said: “The reconstitution of the board, therefore, took consideration of the current stage of evolution of the restructured electricity sector, the complexities the sector currently faces, multi-disciplinary skills of prospective board members, especially in finance and investment, electricity generation, system operations of deregulated electricity markets, administrative law, as well as economic regulation of network utilities, amongst other factors.”
While urging the board members to appreciate the importance of the assignment, Ahmed said: “It is important that we bring our skills and experiences to bear in this critical assignment.
“It is important that we build NBET to become that defensive wall against potential payment defaults, till generation companies and distribution companies are able to enter into power purchase agreements on bilateral basis. NBET has to be able to successfully fulfill its role in the management and administration of financial flows in the sector, the promotion of a contract-based market that allocates risks efficiently to parties responsible for them and the formulation of policies for efficient system settlement”.
President Muhammadu Buhari recently approved the reconstitution of the Board of Directors of NBET.
A Non-Executive Director from Ministry of Power, to be represented by a staff not below the level of a director; Mr. Alexander Ayoola Okoh, as Non – Executive Director from Bureau of Public Enterprises (80% Shareholder in NBET); Ms. Patience Oniha, Director-General, Debt Management Office, as Non-Executive Director; Mr Ben Akabueze, Director-General, Budget Office of the Federation, as Non-Executive Director.
Also appointed are Suleyman Ndanusa, former Director-General of Securities and Exchange Commission (SEC), as Non-Executive Director (Independent); Engr. Mustapha Balarabe Shehu, former President Nigeria Society of Engineers (NSE), as Non-Executive Director (Independent); Mr. Adeyeye O. Adepegba as Non-Executive Director (Independent); and Dr. Marilyn Amobi, as Managing Director/ Chief Executive Officer.