FG Orders Investigation into License Extension for DisCos

• Declares 700MW Zungeru Plant Ready for Take Off

The Minister of Power, Adebayo Adelabu has announced that Nigeria’s second-largest hydroelectricity power station, the 700 megawatts capacity Zungeru Power Plant, is ready.

Adelabu, who made the revelation during a media parley with the Power Correspondents in Abuja on Wednesday, added that he ordered investigation into the extension by five years, the licenses of Electricity Distribution Companies, otherwise known as DisCos.

The Minister said “When I came in, the licenses I saw were for 10 years, 2013 to 2023. But along the line I spoke to the NERC Chairman they have extended the licenses for another five years. We are trying to review the correctness of that. We have ordered an investigation into the extension of the licenses if they are actually in order.”

The Minister hinted he doesn’t believe that privatization of the power sector assets infrastructures was the way to go, and declared that commercialisation could have been better as the required huge financial investment outlay which the private sector may be able to afford, or may not be willing to commit because its long term returns yields.

He disclosed that the government may need to review the structures of DisCos with regards to streamlining the areas of coverage which he observed are too large for each of the DisCos to manage effectively.

Speaking on issues of cost reflective tariffs, the Minister said the time is not yet right for implementation of cost reflective tariffs, adding that tariffs could have been increased months back but President Ahmed Bola Tinubu did not approve of it.

The government, he said, still subsidizes tariffs until such a time the government is convinced that there is incremental power supply.

In the minister’s words: “I can confirm to you that Zungeru Hydropower Plant is ready to generate upward of 700MW of power. The concessioning has also been approved by Mr. President. So we will start operating the Zungeru probably from the end of this month.

“The only thing remaining in Zungeru is just to complete the evacuation infrastructure so that the entire 700MW being generated can be evacuated into the national grid. So Zungeru is ready and it is an addition to our power generating capacity.”

The Minister stated further that he had taken time to study the sector with a view to finding out why his predecessors who were brilliant in all sense, failed short of delivering to the expectations of Nigerians.

Adelabu lamented that the previous Ministers’ of power did not actualize their plans of improving power situations of the country because they approached the issues of solving the power problem from top to down, noting that in his tenure the reverse would be the case as he intends to tackle it from down to top.

The Minister described as shameful the fact that Nigeria has stagnated around 4000MW generation over the last years, and revealed that plans have been concluded to organize a Power Sector Retreat between 12th and 14th December 2023, which shall produce a workable Roadmap for the sector.

The Minister argued that Nigeria generates upward of about 50,000MW of electricity, but 95 percent of it is through combined diesel and petrol home generators, stressing that the people would not have problem with tariffs increase so long as there is incremental power supply.

He charged the States to take advantage of the reformed power sector Act and invest in Distribution Companies within their states, as well as utilizing existing power lines instead of creating entirely new power infrastructures.