The Federal Government plans to sell 51 per cent of its stakes in the 17 out of the 18 successor companies of Power Holding Company of Nigeria.
Eleven of the companies are into distribution and they will be sold in 2011. Six are in the generation business.
According to the roadmap to power sector unveiled on Thursday by President Goodluck Jonathan, the government will not sell the Transmission Company of Nigeria.
But the transmission company, which is in charge of the National Grid, will be managed by the private sector.
The roadmap reads, “With regard to the medium to long term horizon, the government intends that full responsibility for the operational effectiveness of the distribution companies should shift from the Federal Government to the private sector no later than 2011.
“Nevertheless, the actions and decisions of the Federal Government will continue to exert a significant impact on their commercial effectiveness.
“All the distribution companies are expected to be privatised based on a core investor sale of a minimum of 51 per cent of the government‘s equity in the companies.
“The PHCN successor, thermal generating plants, will be privatised via the sale of a minimum of 51 per cent equity to core investors that clearly demonstrate the technical and financial ability to operate and expand each plant.”
The roadmap can be sighted on the official site of the Presidential Task Force on Power, www.nigeriapowerreform.org.
Jonathan had at the unveiling of the roadmap in Lagos, said that the Federal Government was preparing to leave the power sector in the hands of private operators.
He explained that the government would retain the transmission grid and regulate the operators of the generating and transmission companies.
The President also assured that power would become stable in 2012, the year that independent power producers would have added 5,000 Mega Watts.
He said, “By 2012, Nigerians will not only celebrate one day of stable power supply but one week and one month of uninterrupted power supply.
“We have stated on a number of occasions that on the attainment of stability in the sector, government will disengage from generation and distribution of electricity in the country.
“Government will encourage private sector participation in this area. Therefore, as articulated in the Electricity Power Sector Reform Act, the private sector will be responsible for generation and distribution, while government will still hold the transmission grid but with private sector management.”
The President said at the event attended by 13 state governors and deputy governors , including Mr. Babatunde Fashola (Lagos) and Otunba Gbenga Daniel (Ogun), that independent power plants built by private operators would soon be inaugurated.
He said, “We are in the process of inaugurating independent power producers, international oil companies and companies that have captive production of electricity to produce at least 5,000MW of new capacity.
“These plants will begin production in 2012 and 2013.
“Government will provide incentives that will encourage them to invest in the construction of the power plants.”
Jonathan pointed out that the success recorded in the telecoms sector had shown that only a private-sector led reform could revive the power sector.
“It is obvious that the electricity sector can only expand, like the telecoms sector did, after privatisation,” he added.
The President added that government had decided to implement the power sector reform Act by privatising the 11 electricity distribution companies to bring efficiency into distribution management.
“The distribution infrastructure is dilapidated. The Federal Government has decided to follow through on the Power Sector Reform Act by privatising distribution companies to bring about effectiveness,” Jonathan said.
He also said that government had taken steps to reconstitute the board of the Nigerian Electricity Regulatory Commission, which was dissolved by the late President Umaru Yar’Adua.
He said, “The list of the members will be sent to the National Assembly on Monday, next week. I will also send a chairman that will have credential like the INEC chairman (Prof. Attahiru Jega). I decided to do so because we need a revolution in the power sector.
“We expect that those who will be in that commission will drive the power sector reform initiative.”
Jonathan said that Nigeria’s electricity tariff was the lowest in the West African sub-region, stressing that government was adjusting it for it to be “cost reflective.”
He, however, added that the interest of the ordinary customer would be protected in the tariff adjustment.
The President also said that government had made available, the sum of N57bn for the payment of monetisation arrears of Power Holding Company of Nigeria workers.
Jonathan added that government had set aside funds to pay severance packages to the PHCN workers that might be affected by the sale of the 11 distribution companies.
Also, the Minister of State for Power, Mr. Nuhu Wya, said the power sector could only be rescued from total collapse through sustainable policies anchored on reforming it along commercial imperatives.
At the event, Fashola called on the Federal Government to start the implementation of critical power projects from Lagos State in order to enable the nation achieve the greatest impact with minimum effort and resources.
A statement by his Special Assistant on Media, Mr. Hakeem Bello, quoted the governor as also saying that investment decisions should be made in Lagos on the basis of economic and developmental common sense rather than emotional “cronyism.”
He said ”This(Lagos) is Nigeria‘s largest consumer market, this is Nigeria‘s financial power house, this is the country‘s largest consumer of electricity, and this must be the prime destination for the investment of Nigeria‘s prime resource if we truly desire to achieve the greatest impact with the minimum of effort and resources.”
Fashola noted that year 2010 was the 21st year since Nigeria’s capital moved from Lagos to Abuja.
”This (Jonathan’s) visit, coming 21 years after that historic movement, is capable of many interpretations; but I do sincerely expect that after we have listened to Your Excellency (Jonathan), the most important interpretation will be the one you will leave us with,” he said.
He pointed out that cities like Paris, New York, London, Accra were the places from which global impressions of France, United States, United Kingdom and Ghana were formed.
The governor said, ”The impression of Nigeria is formed from Lagos by the millions who use her sea and airports. If we must therefore improve on that impression, Lagos is like the sitting room of the Nigerian household that must be maintained in a pristine condition; and must get federal funding support for electricity, roads, water supply and critical infrastructure.”
Jonathan, in his address, commended Fashola for the warm reception he received.
The other governors that were present included Adebayo Alao-Akala (Oyo), Patrick Yakowa (Kaduna), Liyel Imoke (Cross River), Aliyu Doma (Nassarawa), and Saidu Dakingari (Kebbi).
By Martin Ayankola and Chinyere Fred-Adegbulugbe
Comments
Post a Comment