Powering Nigeria’s future: A paradigm shift post-retreat
In the aftermath of a well-attended power sector retreat organized by the Ministry of Power, the landscape of Nigeria’s electricity industry stands at a crucial crossroads. The retreat brought together critical stakeholders from across the entire electricity industry value chain, including regulatory bodies such as the Nigerian Electricity Regulatory Commission (NERC), the Transmission Company of […]
In the aftermath of a well-attended power sector retreat organized by the Ministry of Power, the landscape of Nigeria’s electricity industry stands at a crucial crossroads.
The retreat brought together critical stakeholders from across the entire electricity industry value chain, including regulatory bodies such as the Nigerian Electricity Regulatory Commission (NERC), the Transmission Company of Nigeria (TCN), the Rural Electrification Agency (REA), the National Power Training Institute of Nigeria (NAPTIN), FGN POWER, the Niger Delta Power Holding Company (NDPHC), the Nigerian Electricity Management Services Agency (NEMSA), and the Nigerian Electricity Liability Management Company (NELMCO).
As discussions unfolded, it became increasingly clear that the time had come for a significant shift in the approach to managing the power sector.
During the retreat, the Minister of Power disclosed that the federal government subsidised power to the tune of about N600 billion in 2023, underscoring the financial burden on the government. Simultaneously, plans were revealed to split the TCN into two independent entities – the Transmission Service Provider (TSP) and the Independent Service Operation (ISO).
This decision raises questions about the necessity of such a move and the anticipated impacts on the efficiency and effectiveness of the power sector.
Furthermore, the minister’s assertion that it is time to allow NERC to discharge its statutory obligations without political interference signals a recognition of the need for an impartial regulatory framework.
The question of the relevance of the Nigerian Bulk Electricity Trading Plc (NBET) in the evolving market landscape also looms large. Will NBET continue to perform the same functions, or does it need to reinvent itself to align with the changing dynamics of the sector?
These pivotal questions demand comprehensive answers in the post-retreat era. The Electricity Power Sector Reform Act 2023, once passed, will undoubtedly bring about significant disruptions. Are the agencies prepared for these disruptions, and what measures are in place to navigate the challenges that will inevitably arise?
Some states are already positioning themselves to participate in the electricity market. However, the critical issue is whether they possess the necessary infrastructure, capabilities and efficiency to contribute meaningfully. The Federal Ministry of Power and its agencies must play a pivotal role in guiding these states, providing the necessary support, and ensuring that the standards set for efficiency and effectiveness are maintained.
A crucial aspect addressed during the retreat was the capacity and capabilities of the Ministry of Power’s staff. The success of any sectoral shift depends on the competence of the personnel driving the change. Adequate training and skill development programmes must be implemented to equip the workforce with the expertise needed to steer the power sector in the right direction.
The recent signing of a performance contract between the Honourable Minister of Power, Adebayo Adelabu, and President Bola Ahmed Tinubu sets clear expectations and targets. It is imperative that these Key Performance Indicators (KPIs) are cascaded down to the various agencies under the Ministry of Power. Accountability and transparency in meeting set targets within the stipulated timeframes will be crucial to the success of the sector’s reform.
Collaboration is the cornerstone of progress. The power sector does not operate in isolation; it is intricately linked with other sectors. Therefore, inter-ministerial and inter-agency collaborations, particularly with the ministries of environment, water resources, and petroleum resources, are vital. Such collaborations can address environmental concerns, water resource management, and fuel supply issues that directly impact the electricity sector.
Periodic stakeholder engagements are equally critical for the success of the power sector. In a country as diverse as Nigeria, engaging with stakeholders at all levels ensures that policies and decisions are inclusive and reflective of the varied needs of the population. This approach fosters a sense of ownership and commitment among stakeholders, reducing the likelihood of resistance to change.
On a final note, the power sector retreat has set the stage for a transformative era in Nigeria’s electricity industry. The revelations and discussions during the retreat underscore the need for a paradigm shift. It is now time for the Ministry of Power to redirect its focus to policy formulation and coordination, allowing its agencies to take charge of implementations.
The challenges ahead are formidable, but with strategic planning, collaboration, and a commitment to accountability, Nigeria’s power sector can navigate this critical juncture and emerge stronger, more efficient, and better positioned to meet the energy needs of its growing population.
Abdulrauf Aliyu is a Kaduna-based economist and policy analyst [email protected]