…Encourages FG to invest in power sector

BY CHRIS OCHAYI

ABUJA: The Chairman of Nigerian Electricity Regulation Commission, NERC, Dr. Sam Amadi, has said that the responsibility of protecting workers’ welfare does not end in spite of the peaceful and satisfactory settlement of labour dispute in the aftermath of privatisation exercise.

Amadi while speaking at the recent induction of new executives of the Enugu Chamber of Commerce, Industry, Mines and Agriculture, ECCIMA, held at the Nike Lake Resort, Enugu, said the Commission will ensure all stakeholders’ interests are fully protected.

According to him, “democracy regulation also requires the regulator to keep an eye on the protection of public value beyond profitability. This goes especially to the protection of electricity workers welfare. “
He added that, “even after privatisation and peaceful and satisfactory settlement of labour disputes, the responsibility of protecting workers welfare does not end. It continues; and it is the obligation of the regulator to have all stakeholders’ interest protected.”

Amadi stressed further that, “the regulator should work hard to avoid being captured by business and therefore under emphasise the importance of workers. As always, the regulator should remember that a strong labour union is the best protectors of workers’ rights.

The NERC boss, who also harped on public investment accountability in the power sector, insisted that the government, in spite of the privatisation must continue to invest in the sector. He added, “even as the private sector has been drafted in to play the leading role in our power sector, the government must continue to invest in the value chain of electricity.”

Amadi continued, “It is utter foolishness for a country to rely only on the stimulus that the market offers for providing such fundamental public good as electricity. This is more so in a country with little capacity in electricity generation.

“Comparative evidence shows that even with all the institutional reform and incentives, IPPs may not come forth in desired quantity. The market may not provide sufficient stimuli to private investment as required. Or IPPs may find other business environments more attractive for investment.

“How so ever, I think it is not strategic to invest hope for adequacy of electricity supply on IPPs. No! Not with our ambitious project of wanting to be the 20th leading economy in the world by the end of this decade,” he said.

Amadi further said that, “in my view, government should continue to invest smartly, using different business models and when it is prudent, in all the value chains of electricity. It is passé to argue that government cannot run a power business.

“As long as private sector plays key roles and competition is fostered, government can continue to invest in generation through well considered public private partnership frameworks. These investments will not take the beaten of the past.

“This is now a regulated industry. The essence of regulation is that such investment will now follow due process. First, government agencies and department cannot arbitrarily invest billions of naira on any part of the network or in developing new capacity without the approval of the regulator.

“It is mandatory under the Electric Sector Power Reform Act to obtain a leave to construct before the public or private investor can invest in the network. The prudence check by the regulator is necessary because ultimately such investment will affect the regulatory asset base of the industry and would have to be recovered through some form of tariff.