Why we can’t generate 5,000mw of power – FG

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The Federal Government on Wednesday attributed the shortage in gas supply to its inability to reach its promised target of 5,000 megawatts of electricity generation.

The government also said that the inauguration of the governing board of the Niger Delta Development Commission (NDDC), will only take place when the outcome of the forensic audit report it instituted is concluded.

President Muhammadu Buhari
President Muhammadu Buhari of Nigeria

Briefing State House correspondents at the end of the weekly Federal Executive Council, FEC, meeting presided over by President Muhammadu Buhari at the Council Chamber, Presidential Villa, the Minister of Power, Abubakar Aliyu, said whereas government had entered into a firm contract with the Nigerian Bulk Electricity Trading (NBET) Plc, power generation had remained around 4,000 megawatts because of the problem of gas.

He, however, assured that every necessary ingredient has now been obtained to resolve the problem as his ministry is working round the clock to improve the situation.

He said FEC approved N2,740,000,000, the revised estimates for the updated rates of building structures of compensation and resettlement of the communities affected by the construction of 700 megawatts Zungaro Hydroelectric power project.

The amount revises the subsisting amount from N19,640,000,000 to N22,380,000,000.

He said, “Today (Wednesday), I approached councill to seek for approval of revised estimates total costs for the updated rates of building structures of compensation and resettlement of the communities affected by the construction of 700 megawatts Zungeru Hydroelectric power project in the total sum of N2,740,000,000 which will revise the subsisting amount from N19,640,000,000 to N22,380,000,000 and the council graciously approve the request.

“Regarding the drop of electricity, yes, you know, the supply has so many players, gas, the cost that drops, issues of gas to some power plants, they cannot switch on their plant if they do, you will experience some drop once, they switch on, the electricity will increase.

“There may be drop due to fault of generator. It’s mostly generation. I’ve been watching since like yesterday (Tuesday) evening, we had a generation of around 4600 megawatts. And you know, we told you since 1st July, that we’ll be able to raise it up to 5000 when we activated the contract.

“And we have not been able to do so, due to some issues around gas contracts, gas to power, which we are trying to take care of. And we have gone very far with that, and I believe, is for that reason that we’re able to reach up to 4600 as of yesterday.

“This morning, it dropped to 4100. So, this is what is happening, you will be experiencing this fluctuation due to all these issues around gas to power, because gas is not something that we control directly, they will not give you gas until you pay. So, we are looking at ways to solve that issue.

“It is the reason we are unable to reach that 5,000 we promised you by July 1 of this year. But as you will see from that date, July 1st, we have been around 4000 megawatts since then. Even if you experience a drop, it may not be throughout the day, you will see by evening it will rise up again, just like I saw 4600 megawatts as at yesterday evening. So, this is the situation. So, we’re working around the clock to ensure that we raised the capacity to the required level.”

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He said that the Federal Government has firm contracts with only five of the 28 Power Generating Companies but have extended it to more GenCos to stabilise supply at 5000MW as of July 1.

Aliyu, however, assured Nigerians that the government has “all the ingredients” to solve the supply challenge soon.

He explained: “We have 28 generating companies and only five or thereabout that we’re having firm contracts with. If you don’t have firm contracts with them…firm contract means that what you agree upon, you must give or else there’ll be a penalty. And there must be uptake. This is what it means to have a firm contract.

“Now we have extended to other generating companies by July 1, to be able to have a firm contract to generate 5000 megawatts as a baseline, and we’re not stopping there. We’ll start ramping up with the other ones. So, this is the situation. We are working around the clock to ensure that we raise the capacity to the required level.”

Fielding question on the strike by Members of the National Union of Electricity Employees, NUEE, the Minister said that the protesting workers have no grudges with his ministry but the Head of Civil Service of the Federation, Dr Folashade Yemi-Esan.

Recall that early hour of Wednesday, the NUEE withdrew its services from the Kaduna Regional Headquarters of the Transmission Company of Nigeria, according to the directive of the union’s national leadership.

NUEE officials cordoned off the Mando TCN Station in the Kaduna state capital, cutting all operations, and forcing workers out of the company’s premises before locking the gate.

The union is protesting the nonpayment of outstanding arrears owed to former workers of the now-defunct Power Holding Company of Nigeria, suspension of conditions of service and career path for workers and the directive by the TCN board to conduct promotion interviews for acting principal managers who are moving to Assistant General Managers.

The workers said the TCN Kaduna office, which oversees operations in Kaduna, Kebbi, Sokoto and Zamfara, will resume operations only after the Federal Government meets their demands.

Answering queries on the issue, the Minister of Power said “The issues they have is not particularly something to do with us, but with employment issues with the Head of Service.”

He disclosed that the Minister of State for Power, Minister of Labour and Employment and the Head of Civil Service of the Federation were absent from the FEC meeting to resolve the crisis.

Also briefing, the Minister of Niger Delta Affairs, Umana Umana, assured that government was also anxious to see the board of the NDDC in place because it would aid the smooth working of the ministry.

He, however said, that will only happen if the forensic report is out, assuring however, that government was at the stage of concluding on that.

He said, “I can very conveniently say that the constitution of the board will follow immediately thereafter. Nobody is trying to stall the constitution of the board. Nobody. I want the board in place, because it would make my work run smoothly. But we must also follow the due process, conclude on this report and the white paper is issued. So that is the position.”

Umana also said the council approved the additional costs of carrying out the forensic audit in the size of was considered and approved by counsel.

He said: “You’ll recall that for this exercise, a lead consultant was appointed who had to work with 16 other field auditors and the initial contract zone which covered the lead consultants and the field forensic auditors was N1.786 billion.

“These auditors have since concluded their work but in the cost of carrying out this work, it was discovered that they had to deal with many more projects than were initially envisaged. And the exercise also took an additional seven months.

“The total number of additional projects considered by the auditors was 3,773. So for reasons of the additional number of projects and the additional time taken, Council today approved a revised additional sum of N765,974,975.50 to cover the additional works done by the forensic auditors.“

The Minister of Information and Culture, Alhaji Lai Mohammed, while responding to what government was doing to stem rising inflation, said: “I wish my colleague the Honourable Minister of Budget, Finance and National Planning, was here and she will probably tell you both the fiscal and monetary measures government is taking, especially in the area of the medium-term fiscal measures.

“But what I can tell you is that inflation is a global issue. And I think it reflects, you know, a lot of things going on, globally. But what government do to stem inflation varies from government to government.

“Sometimes it is the way you adjust your interest rate or the way you introduce certain fiscal measures that would allow you to bring down the inflation. But like I said, I wish the Minister of Finance was here she will be in a better position to tell me exactly what measures we’ve been taking to ensure that inflation does not continue to soar.”

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