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A major milestone was achieved Friday in the nation’s bid to reposition the power sector for stable electricity supply with the hand over of operations of the privatised generation and distribution companies to their new owners.

At yesterday’s events, four power generation companies; Ughelli Plant, Geregu I Plant, Kainji Hydro and Shiroro Hydro, and ten distribution companies, namely, Ikeja, Eko, Ibadan, Jos, Kano, Yola, Abuja, Benin, Enugu and Port Harcourt, from the now extinct Power Holding Company of Nigeria (PHCN), were handed over to their owners – who had cumulatively paid about $3 billion (N480 billion) in August.

At the handing over ceremony of Abuja Distribution Company to KANN Consortium Utility, Vice President Namadi Sambo, who was represented by the Minister of Power, Prof. Chinedu Nebo, noted that the power privatisation programme was historic as it represents the biggest divestment programme of public utility in Africa.

He explained that the government now relies on the financial and technical capacities of the new private investors to help advance its plans to ramp up power generation and supply in the country.

He said it was the fear entertained by government against possible asset stripping that informed its insistence on investors with proven financial and technical capacities for the assets.

“Reputable, buoyant and financially stable owners were selected to avoid assets stripping. We are sure that there will be no more business as usual but business unusual in the sector going forward,” Sambo said while assuring Nigerians that the reforms being implemented in the sector by the government would increase consumers’ access to electricity and in turn stimulate economic growth.

He said: “The participation of the private sector would bring about higher generation capacities through the provision of more efficient and cost effective power stations and improvements in electric power distribution, in the areas of billing and collection, and transmission networks.”

Sambo however warned the new owners of the public utilities that government would sanction any of them who fail to deliver on the agreement reached with it.

He assured workers of the defunct PHCN that government remains committed to meeting up with its agreement with them, adding that about N360 billion had been spent on the settlement of their entitlements.

He stated that the remaining N30 billion needed to complete the payment was ready and that government would keep to its own part of the bargain which enabled its handover of the power assets to the new owners.

In Kogi, Geregu Power Station was handed over to Amperion Power Distribution Company Ltd. The Managing Director, of the Geregu Power station, Engr Adeyemi Adenuga, said that the power station was being owed over N15. 93 billion by market operators, a fact which he said had hampered the expansion of the station.

The eighteen business units that make up the Enugu Electricity Distribution Company (EEDC) in the five South East states were also handed over to the new owner, Interstate Electric Limited.

New Chief Executive Officer of the EEDC, Mr Robert Dickerman, said that through the change in control, “there will be some reshaping of the company’s strategy, goals and objectives”.

He assured workers of the defunct PHCN that government remains committed to meeting up with its agreement with them, adding that about N360 billion had been spent on the settlement of their entitlements.

He stated that the remaining N30 billion needed to complete the payment was ready and that government would keep to its own part of the bargain which enabled its handover of the power assets to the new owners.

In Kogi, Geregu Power Station was handed over to Amperion Power Distribution Company Ltd. The Managing Director, of the Geregu Power station, Engr Adeyemi Adenuga, said that the power station was being owed over N15. 93 billion by market operators, a fact which he said had hampered the expansion of the station.

The eighteen business units that make up the Enugu Electricity Distribution Company (EEDC) in the five South East states were yesterday handed over to its new owner, Interstate Electrics Limited.

New Chief Executive Officer of the EEDC, Mr Robert Dickerman, said that through the change in control, “there will be some reshaping of the company’s strategy, goals and objectives”.

He assured members of staff that they would be considered as shareholders of the company as a way of creating in them a sense of belonging, while calling on all to support the new vision of the company.

Outgoing Chief Executive Officer of the EEDC, Engr. Suleiman Yahaya, said that the Enugu distribution company was made up of 18 business units covering Imo, Anambra, Enugu, Abia and Ebonyi States and have resourceful workforce that, if given the right infrastructure, would grow into sustainable and profitable company.

Chairman of the Interstate Electrics, Sir Emeka Offor, said that as an investor from the Southeast, he would as fast as possible restore the confidence of the Southeast in the company.

Among members of the new board are former Senate President, Ken Nnamani, former Minister of Torism, Prince Kayode Adetokunbo, Dr. Stephen Dike, and Mr Kester Enwereonu.

Also in Yola, Adamawa State capital, the Federal Government officially handed over the Yola Distribution Company to Integrated Energy Distribution and Marketing Limited. Senior Special Adviser on Power, Engr O.S Egberongbe, who stood in for the Vice President, said the development was made possible because of the administration’s commitment to the roadmap for the provision of stable power to drive the economic transformation of Nigeria.

The Transnational Corporation of Nigeria (Transcorp), the new owner of the Ughelli power plant in Delta State, said it would increase the output of the plant from the current 330megawatts to 1,500megawatts within the next three years.

Speaking yesterday during the handover ceremony of the plant to the new owner, the Chairman of Transcorp, Mr. Tony Elumelu, said the Ughelli plant would be at the forefront of the current efforts by all the stakeholders to improve power supply in the country.

Elumelu, who was handed over the plant by Vice President Namadi Sambo, represented by the Minister of Labour, Chief Emeka Wogu, commended President Goodluck Jonathan for the successful conclusion of the privatisation exercise.

In Port Harcourt, 4 Power Consortium took over the operations of the Port Harcourt Distribution Company. Speaking at the ceremony, the Permanent Secretary, Federal Ministry of Power, Godknows Igali, said the hand over was a culmination of 14 years of painstaking efforts by the Federal Government, through the national Council of Privatisation (NCP) and the Bureau of Public Enterprises (BPE) to reform and liberalise the nation’s power sector.

Igali also revealed that between April 22 and September 2013, the Federal Government had released 60 per cent share certificates to new investors and owners in the power sector.

He further explained that the Federal Government had fully paid about 40, 698 workers of the Power Holding Company of Nigeria, PHCN and another set of 14, 900 out of 40, 000 had received their full pension entitlements.

The Chairman of the 4Power consortium Group, Sir Augustine Wokocha, said the hope of the new owners was to accelerate, to a supersonic speed, the hitherto slow returns on investments, as they would be charged with the zeal and enterprise of the private sector.

Noting that the PHED covers four states namely: Bayelsa State, Rivers State, Aqua Ibom State and Cross River State, which covers a service territory of about 39,206.25 sq km and a total population of 14 million, he however expressed regret that, only 530,000 customers which is a paltry 3.8 per cent of the population of the area were connected to the national grid.

In Edo, Vigeo Power Limited took over the operations of Benin Electricity Distribution Company (BEDC) as new owner. Its Chairman, Otunba Victor Gbolade Osibodu, urged the Federal Government to conclude the payment of entitlements of PHCN workers to enable new investors who took over the various companies to enjoy a stable working environment.

In Lagos, the Power Holding Company of Nigeria (PHCN) successor company, Eko Electricity Distribution Company plc (EKEDC) was handed over to its new investor, West Power and Gas (WPG).

Dr. Oladele Amoda of EKEDC said they would also be monitoring their successor in term of ways they operate, whether it would be in line with the agreement signed.

At the handing over ceremony of Jos Distribution Company, the Chairman of Aura Energy Limited (AEL), the new owner, Alhaji Tukur Modibo, assured consumers that the era of uninterupted power supply had come. He, however, warned customers that were in the habit of conniving with electricity workers to dupe the company that such would not be tolerated.
The Jos Electricity Distribution Company comprises Plateau, Benue, Gombe and Bauchi states.
At the ceremony in Ibadan, where the ownership of Ibadan Eletricity Distribution Company was formally transfered to its core investor, Integrated Energy Distribution and Marketing Company Limited, formally took over, representative of the new owners, Mr Olatunde Ayeni, said the vision of the investors was to transform into a world class organisation and become a leader in the electricity distribution industry.

In his own speech, Governor Ibikunle Amosun of Ogun State said any nation which failed to get its power supply right would not witness progress. Governor Ajimobi of Oyo State urged Nigerians to cooperate with the new owners.

 

POWER REFORM TIMELINE

2000    National Council on Privatisation (NCP) sets up Power Sector Reform Implementation Committee

2002    New draft legislation is produced to repeal the Electricity Act

2002    Electric Power Sector Reform (EPSR) Bill is submitted to National Assembly as an executive bill

2005    Electric Power Sector Reform Bill is passed into law

2005    Nigerian Electricity Regulatory Company (NERC) is established

2006    National Electric Power Authority (NEPA) is wound up and Power Holding Company of Nigeria (PHCN) established
2006    PHCN is unbundled into successor companies comprising 11 distribution companies (Discos), six generation companies (Gencos) and one transmission company

2007-2009    Power reform programme is stalled under the Umaru Yar’Adua administration

2010    Power reform programme is restarted by President Goodluck Jonathan with the establishment of the Presidential Task Force Committee on Power headed by Professor Barth Nnaji

2010    Power sector reform blue print is launched, paving the way for NCP and Bureau of Public Enterprises (BPE) to commence the privatisation of the successor companies

2012    Manitoba Hydro is appointed to run the Transmission Company of Nigeria (TCN) in September under a management contract

2013    Preferred bidders emerge for six Gencos and 10 Discos in January (privatisation of Afam Power Station and Kaduna Disco are restarted). Egbin power station, which was partially sold in 2007 by the Olusegun Obasanjo administration, is thrown into the mix

2013    Preferred bidders pay initial 25 percent and outstanding balance (75 per cent) on August 22 for the power utilities. CMEC/Eurafric is the only bidder unable to conclude payment for Sapele power station

2013    New owners of the Gencos and Discos are handed their share certificates on October 2

2013    New owners of the Gencos and Discos takeover the physical assets on November 1

 

Information from This Day was used in this report.

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