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What Nigerians think of decentralization of Nigerian power sector

What Nigerians think of decentralization of Nigerian power sector

By Idowu Oyebanjo

Following the amendment of the constitution of the Federal Republic of Nigeria to allow states to regulate, generate, transmit, and distribute electricity, Nigerians from all walks of life have been genuinely concerned about its implication on the conundrum of problems facing our ailing power sector.

To analyse the views of Nigerians, this survey was used to find out what people think about the policy in general.

Survey Questionnaire

What do you think of the decentralization of the Nigerian Power Sector?

Is it Good or Bad?

A poll of 20 respondents was analyzed.

Eighteen out of the 20 respondents (90%) believe the policy is good for the Nigerian power sector while 2 (10%) of those who responded felt otherwise.

Commentaries

Let’s hear from those in support:

The decentralization is a good step towards deregulation of the power sector.

Decentralization will remove the current monopoly business nature, which will lead to more satisfied consumers ushering in a revenue value chain that will definitely improve with time.

Centralization denotes economy of scale and elimination of bottle necks. Consuming power on a regional scale is more in line with the small scale level of our current power infrastructure.

The decentralization of the Nigerian power sector is good because it’ll increase energy efficiency, security and local economic development.

If properly structured and executed, it could give better results. For instance, if the present DisCos can become autonomous, to generate, transmit and eventually distribute to specific areas, they will strive to deliver without passing the buck to any other entity. No more blame game!!!

It is good because it avoids or minimizes transmission and distribution footprints, thus saving on cost and reducing losses.

I think for this policy to be successful, the implementation process should be taken in phases and handled strategically by qualified professionals.

On the DisCos end, the implementation should aim at reducing ATC & C, especially collection losses. This would enable investments made by State Governments in the various DisCos’ franchises yield adequate ROI.

On the Transmission end, the implementation should ensure grid stability is not compromised for any interest. On the generation side, involvement of the State Government would boost generation capacity. However, if generation stations are not properly cited in such a way that considers proximity to feedstock, evacuation challenges are not unlocked and challenges relating to targeted loads are not taken into consideration, investments would be regretted and the policy will go down the history like others.

Lastly, it should be noted that having multiple regulatory bodies regulating the sector is not advisable and would cause confusion and conflict. The implementation document should take this into consideration.

Overall, these suggestions need to be considered in the implementation process to enable this policy to be successful.

Decentralization of Nigeria power sector will improve the delivery of electricity to underserved or unserved areas where the existing National grid power system can’t meet supply requirements.

Allowing states to generate and supply electricity will relieve the National grid of being overloaded.

In a situation where the National grid collapses, the whole Nation won’t be affected.

States should be able to generate & distribute their power for the benefit of their citizens/indigenes & not add it to the national grid.

(i) Conflict is reduced when the power is shared between the center and states and local government. (ii) a large number of problems and issues can be best settled at the local level. (iii) People have better knowledge of their own problems in their localities. (iv) They know better where to spend money and how to manage things efficiently. (v) People at the local level participate directly in decision-making.

The decentralization of the power sector if implemented effectively will bring advantages to the states that are ready to tap in and bring about development there.

This is an Excellent idea.

It is part of the broader objectives of economic restructuring to empower federation units to achieve development. It will incentivize healthy competition among states.

The decentralization is both ways, if properly handled with carefully thought out strategies, it will thrive but if mishandled, it will cause more chaos and the fragility of the power system will spiral downward.

We even had a straight opinion:

“My opinion is quite straight on this”

I suggest the grid should be decentralized because Nigeria’s stay in the darkness and poor electricity supply is long overdue and we can’t afford to miss any solution that can take us off this messy doom.

Decentralizing the grid will allow healthy competition in the sector thereby driving more investments that will in turn supply the nation with adequate power.

While being overly optimistic about the success of the grid decentralization strategy, I am still aware that some parts of the population will be marginalized thereby causing inequitable energy access to the Nigerian populace. This will be due to the inability of some state governments to invest adequately in the power sector inspite of the prospects this bring. Though the reasons maybe financial, fiscal or political but, this is in no way an excuse for any reasonable and responsible government.

Decentralization of the Nigerian power sector is a welcome development. However, we need to do this with sincerity of purpose.

On the flip side, one of the two respondents who feel that the decentralization policy is not good for the power system opines that a decentralized grid will lead to several unstable grids. Another respondent who shares the same view highlighted that Decentralization, Digitization and Decarbonization are good for well developed and strong grids. The Nigerian Grid may still be considered as an infant with only about 5,000MW (5GW) when the expected true load (including suppressed Load) is in the range of 25,000 MW (25GW). Decentralizing a 5GW Nigerian grid is not technically and commercially viable.

HOW DO WE CONCLUDE?

DECENTRALIZATION OF THE NIGERIAN POWER SYSTEM – GOOD OR BAD?

THE GOOD HAVE IT!

 

What Nigerians think, decentralization, Nigerian power sector, Idowu Oyebanjo
Dr. Idowu Oyebanjo, FNSE, FNIPE, FNIEEE, CEng, MIET UK, is an energy expert with decades of experience in oil, gas and power systems.

 

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