By Daniel Idonor
ABUJA—PRESIDENT Goodluck Jonathan yesterday declared that the annual expenditure of over  $13 billion (N1.989 trillion) on purchase of diesel to run generators by Nigerians was unacceptable.

He spoke at the Presidential Retreat for power investors, lamenting that despite expending $13 billion (N1.989 trillion) every year providing power from diesel generators, less than half of Nigerian citizens have access to electricity.

The president, whose facts were backed up by statistics from the Central Bank Nigeria, CBN, however, assured stakeholders present at the retreat meant to have a better understanding of the investor’s concerns and gain insights from their experience in other markets that the government was on top of the situation.

He said: “With a population of more than 140 million people and the seventh largest deposits of natural gas, and a major fuel for power in the world, we are ready for business.

“Generating power from generators adds more than 40 per cent to the cost of goods and services in Nigeria and this we can ill-afford.
“Our mission, therefore, is for Nigeria to reach power reliability and sustainability within the shortest possible time so as to catalyse the much needed development.”

He also noted that Nigeria required just about $10 billion per year in investment, over the next few years, to develop her generation, distribution and transmission capacities.

The Presidential Retreat for Power investors came 49 days after the launching of the Road Map of the Power Sector Reform.

According to President Jonathan, understanding the investor’s concerns and gaining insights from their experience in other markets will help the country build a power supply industry that works for all and grows as fast as possible.

Jonathan, however, noted that “we know what is at stake”, hence the creation of the Presidential Action Committee on Power, PACP, which has finally birthed the roadmap for the reforms.

According to him, one of the things that Nigerians have come to agree on is that throwing ever-increasing amounts of government money that is better spent on improving education or healthcare cannot be the solution to Nigeria’s power problem.

To implement power sector reform

“This administration is determined to implement the reform of Nigeria’s power sector in a way that Nigerians shall be proud of.

“We are determined to attract high quality investors with the record that ensures they will bring world class expertise and industry best practices to our evolving power supply industry,” the president said.

Following this, the president said the Federal Government was now looking for companies that could efficiently and rapidly expand services to under-served parts of Nigeria.

“Remember this is a country with tens of millions of potential new power consumers. We need firms that can grow quickly. Our national interest dictates that we encourage investors who are willing to stand with us for the long term, not those without the requisite pedigree in the sector,” he added.

He noted that an opinion poll sponsored by the World Bank has confirmed that Nigerians were willing to pay for cost reflective tariffs for electricity, due to the fact that even some of the poorest Nigerians, including artisans and small business people, spend considerable amounts on petro-powered generators.

The president stated that with the backing of Nigerians, his administration was set to transform decades of paralyzing government monopoly into private sector efficiency.

“All we need to ensure its abundant supply is  investment transparency and efficiency management.  We are determined to make the power sector reform fair to all concerned. In this reform, there will be no losers and Nigerian people, including workers, will be the beneficiaries.

“No one is in doubt that the biggest casualty of our epileptic power sector is our manufacturing sector and the jobs that could have been created for thousands and thousands of our citizens. The work of building a prosperous Nigeria cannot be done if our factories continue to run on generator,” Jonathan stressed.

The president further disclosed that the reforms would allow investors to become involved under concessions or privatization, adding that from next year, the federal government will cease investment in power generation and distribution and also concession the management of the transmission company of Nigeria.

He said:  “Federal government will complete processes for already initiated hydro-power projects.”

Earlier in his remark, the Minister of State for Power, Nuhu Wya, noted that “the government has calculated that something like $10 billion per year needs to be invested throughout the power supply chain in order to achieve the relatively modest (by international capacity) target capacity of 40,000mw by 2020”.

In his presentation, the Special Adviser on Power, Professor Barth Nnaji, said the Central Bank of Nigeria, CBN, has established a N300 billion fund that could be assessed by prospective investors in the power sector.

With the unbundling of PHCN, establishment of NERC and the launch of the roadmap to power sector reform, the Special Adviser said the coast was now clear for private sector involvement. He assured prospective investors that fully cost reflective tariffs will be introduced.

Other top government functionaries present at the retreat were the governors of Adamawa and Ekiti states, Minister of finance, Olusegun Aganga, minister of state for power,  the CBN governor, Sanusi Lamido Sanusi and international investors.