Nigeria’s unemployment situation is largely attributable to the gross deficiencies in the power sector. This has hobbled the growth of micro, small and medium enterprises (MSME, which are the engine of job creation worldwide. In this interview, Deputy President of the Nigeria Labour Congress and General Secretary of the National Union of Electricity Employees (NUEE), Joe Ajaero gives insight to the foundational cause of the problems in the power sector.
When you look back over the last 20 years since the return to civil governance in 1999 and the past 60 years of our nationhood, and against the background of the huge investments made by the present and past administrations, how do you feel about the state of the power sector today?
The power sector is not different from the other areas in terms of infrastructural development, if you look at the roads, healthcare and educational system. In fact that of public water supply has also collapsed. I do not know of any city in the country, where you can open a tap and get water from the public supply. That is why people are digging boreholes here and there. Now, focusing specifically on the power sector, I can say that the money spent by the Obasanjo Administration was enough to give Nigeria 50,000 MW generation capacity. So you can then see that the power sector has been a centre and cesspit of corruption for the dumping of non-performing ministers. You cannot have a better system with people who don’t know their left from their right; with people who go there based on political patronage. The current situation is making it worse. With due respect to former President Olusegun Obasanjo, he was the person that actually brought back power generation to 4000 MW during his first term. When Senator Liyel Imoke was the minister of power, we had the Technical Committee on Power. They did not build any new power plant as at that time, what they did was to refurbish the existing ones and we celebrated attaining 4000 MW by 2002. Thereafter, we started building some political power stations like Geregu, Omotosho, Papalanto and some other ones under Obasanjo. Unfortunately some of them were commissioned with diesel generator and till date nothing is happening. The power plants were just located where the ministers and some big men come from (as evidence that they brought federal presence to their areas). The plants were not located in those places for economic reasons, taking into consideration their proximity to what they need to be able to function. It was a situation where they built power plants in Kogi and Papalanto (Ogun State) and then laid gas pipelines to the plants from Rivers State. That is the kind of problem we have because gas-based power plants are very expensive to run. On daily basis you hear the generating companies demanding for the payment of billions for gas. Meanwhile we have other sources of power. The coal we have in Enugu, Kogi and Benue is more than enough to run power plants. Several countries like Germany, Britain, Poland, Russia and South Africa still generate up to 40 per cent of their electricity from coal-fired power plants, but Nigeria is just looking at gas, gas, gas and it is now talking about emergency power projects. The situation makes my heart bleed for this country and the fate of the next generation. As at today, Nigeria is suffering from power poverty. The global index is that for every one million people you have at least 1000 MW. With Nigeria’s population at almost 200 million people do we have 200,000MW? As at today, we have not exceeded 4000 MW, which was the level reached under the Obasanjo administration, after the military mismanaged the plants he built before leaving office in 1979 as head of state. By the time he came back as President in 1999, we had generation capacity of over 13,000 MW but the thermal and hydroelectric plants were mismanaged and allowed to degenerate. So he appointed Liyel Imoke, who led the team that refurbished and revived the power stations, and this enabled the actual generation to rise to 4000 MW by 2001 and 2002 from less than 2000MW, but this was not sustainable. Some of the equipment had become obsolete and no new plants were built and added to the grid.
As we talk, if we are able to generate up to 10,000 MW, the transmission grid can only absorb about 8,000MW maximum. But the major problem is that the distribution companies (DisCos) can only wheel (that is take up and distribute) only 4000MW. There is hardly any transformer today that is not on overload. The private sector companies that acquired the DisCos are not replacing the malfunctioning transformers they inherited and which are being damaged by overloading. They are not investing in building new electricity distribution lines, a major thing they were supposed to do in line with the terms of privatising agreement. What this means is that if you push in 4000 to 5000 MW of power the grid will collapse, and that is exactly what has been happening. In other words, if the transmission capacity is 8000MW (controlled by the Transmission Company of Nigeria), the privately owned DisCos are not able to take more than 4000 MW. Before PHCN was unbundled and sold, the generation capacity was 13000MW and primed to reach 16,000MW. Now if we generate the 16,000MW and distribute that much, even if we distribute 10000 because of technical faults here and there, it would have a significant impact Nigerians would be happy today and looking forward to a near future of electricity on demand, 24/7. This is our sad situation today.
Before PHCN was unbundled, people clamoured for change in the power sector. Looking at the decay and deficiencies in the sector, do Nigerians have any justification to be angry now?
Yes, we are angry because the situation has become worse in some key areas. Almost 20,000 to 30,000 Nigerian workers were sacked because of the privatisation, causing loss of employment. When you sack that number of workers, almost one million people will be affected. The people are not getting the services they clamoured for and everybody is lamenting now. Under the market dynamics, if you were distributing 4000 MW, for instance, one year ago and the supply is constant this year, more residential houses that need electricity will be built. It means that a person who got six hours of power last year will get much less this as the supply is constant while demand is increasing. A country with progressive leaders would know that more power plants need to be constructed to meet the rising demand. As at today, there is no new power plant that can be added to the national grid this year. We are not aware of any coming on-stream next year. The third point is the issue of tariff. We are paying more for darkness. Again, in July a new much higher tariff will take off and Nigerians will pay through the nose for power that is not being supplied. In these three basic areas, should we not complain? If we were told that the people coming would be better and they have not improved on the situation, should Nigerians not be angry? Under government control Nigerians paid less tariff and received hours of power supply, but now they are paying much more but getting only darkness; should they not be angry? This is why the government should not have sacrificed the welfare of Nigerians in this foolhardy and socio-economically crippling experiment it touted as privatisation of the power sector. And it was not as if the government was not warned about the inherent dangers posed to the country. Any commodity that is not accessible cannot be affordable. Nigerians have cause to complain and to be angry. In fact I see a day that Nigerians would pour into the streets nationwide to protest against the Shylocks taking their blood through excessive estimated bills while giving them perennial darkness. I want to repeat, Nigerians have every reason to go into the streets to protest and complain seriously.
But it was Nigerians that asked for the change from PHCN to private companies?
I will throw some light on this. Before NEPA (National Electric Power Authority), we had the Electricity Corporation of Nigeria (ECN) and the Niger Dam Authority (NDA). ECN was distributing and selling the electricity generated by the NDA. Back then ECN would sell power and not pay NDA for the bulk power it bought. NDA could not pay its staff and maintain its power plants adequately. This led to the merger of the two organisations (generation, transmission and distribution) to form NEPA, so that workers of NDA and ECN would receive their salaries under one central control. Years after, people without insight decided to break up the organisation into three parts – generation, transmission and distribution. Generation and distribution were privatised while the government retained transmission 100 per cent for national strategic reasons (government control of TCN is our saving grace today). As at today, when the DisCos collect money, they do not pay the exact rate to either TCN or the GENCOs. Now there is no money to pay the GENCOs and TCN, to service the generation and transmission infrastructure. The same problem that led to the merger of ECN and NDA has resurfaced. In the past, both ECN and NDA were both government entities. When I warned the government that this problem will imperil the privatisation, nobody listened to me. Today, everything has fallen apart and the people are bearing the brunt, the pain and enduring the agony.