Clara Nwachukwu
THE Bureau of Public Enterprises, BPE has just ended a global road show in a bid to attract genuine investors to the comatose power sector, which so far, had defied all logical solution.

The road show tagged, the Nigerian Electric Power Investors’ Forum took the BPE and its entourage to Lagos; Dubai in the United Arab Emirates, UAE; London in the United Kingdom; New York in the United States; and Johannesburg in South Africa, during which it tried to convince prospective buyers of Federal Government’s commitment to privatise the power sector.

However, one major concern expressed by participants at the forum across the continents, is the ability of the Bureau to sell the 51 percent government’s equity in 11 distribution companies, DisCos and five generation companies, GenCos, on offer to the right investors with proven competence.

The concern is borne from the fact that although indigenous Nigerian firms may have developed technical competence and expertise in power generation, but they have little experience in transmission and distribution, which are at the heart of the failure of the power sector, as most of the power generated cannot be delivered to the consumers who need them due to technical glitches.

For instance, it has been estimated that due to transmission and distribution shortcomings, Nigeria loses about 55 percent of power generated, thus making the country one of the world’s poorest in terms per capita kilowatts.

The result is such that industries, small businesses and domestic consumers resorted to generating their own at very huge costs through fuel purchase and maintaining the generating sets. The development has made Nigeria, the biggest importer of generating sets in the world.

While the Nigeria Electricity Regulatory Commission, NERC, the regulator of the industry is constrained about wielding the big stick on the dumping of generating sets in the Nigerian market due to supply shortfalls, it is however, optimistic that the privatisation of the power sector will phase out generators import with improved electricity service delivery as it did in other countries of the world.

Furthermore, the industry regulator urged indigenous firms interested in bidding for any of the distribution and generation companies on offer to form consortia with foreign companies, which have the technical and financial capacities to run the companies.

Against this backdrop, one of Nigeria=s indigenous old players in the power sector, Global Utilities Management Company, GUMCO, a 100 per cent subsidiary of the Vigeo Group has expressed interest in bidding for a number of the distribution companies on offer.

GUMCO, which was founded in 1999 as a public utility management company, set up Vigeo Power, as the Special Purpose Vehicle, SPV, to be used for the privatisation exercise.

The Executive Chairman of the Company, Mr. Victor Osibodu, told journalists in Lagos that not only is his company taking the NERC advice to form consortia with foreign firms, but also has the experience to purchase any of the companies on offer.
Refusing to disclose the identities of the Indian firms or which of the distribution companies it is interested in, Osibodu merely said, “We are in talks with two Indian companies who have the technical expertise and Vigeo Power will be the lead company in the consortium.”

With regard to experience in power distribution in Nigeria, the Vigeo chairman recalled that his Vigeo was one of the companies contracted for the Revenue Cycle Management, RCM, for the distribution companies for a period of five years, and later also contracted to participate in the National Pre-payment Metering Programme, NPPMP.

The RCM management contract was a Private-Public-Partnership, PPP initiative aimed at reducing Non-Technical losses and improved customer service delivery in the project area. While the Pre-payment Metering Programme was designed to bridge the metering and billing gap in the DisCos to increase revenue collection efficiency and reduce non‑technical losses through improved customer service.

Osibodu said, “Our success at this period was enormous. Our tasks included staff training, customer care management, increase in revenue, establishing a robust Information technology, IT solution for effective billing by applying new technologies to enhance value of services to our clients and customers.

Our activities in the RCM were in the Shomolu, Ikorodu and Ojodu districts in the Ikeja Distribution Zone in Lagos. The contract was for an initial three year period, which was extended for another two years, which were characterised by:

• Improved revenue generation by 100 peercent.
• Reduction of Commercial and Non‑Technical losses.
• Automation of payment receipting / payment through banks.
• Development and implementation of management information system, MIS for effective and efficient customer service delivery.
• Introduction of Key Performance Indexes, KPI for the industry.

He added that over the years, GUMCO gathered both local and foreign expertise, and now offer broad based solutions for rural electrification, supply and installation of power and distribution transformer, metering, electricity vending infrastructure, IT/Billing infrastructure management, revenue management and protection, technical support to utilities distribution companies.
At the completion of this contract, he said GUMCO was still active in the districts by providing support services on the billing infrastructure and data management aspect for the zone.

Based on the RCM successes, Osibodu said GUMCO was selected as one of the 15 companies contracted to participate in the three‑year prepaid metering programme.

“Our contract area was with the Benin Electricity Distribution Company, BEDC. This primarily involves the procurement, installation and management of pre‑paid metering system.”

The Benin Distribution Company covers four states, including Edo, Delta, Ondo and Ekiti, with 16 business districts in all. “The contract provides for the installation of 161,000 prepaid meters within two years and management of vending operations until operators= investment in metering and vending infrastructure is fully repaid,” he added.

According to him, “GUMCO emerged top among the PPM operators, installing over 150,500 Prepaid meters under two years, a figure that represents 31 percent of the total prepaid meters deployed nationwide, a feat which is indeed the first worldwide.”

Against this backdrop, Osibodu argued, that the executions of the RCM and National Prepaid Metering programmes and other technical support services rendered to the different DisCos put Vigeo in a position to continue to play a pivotal role in the power industry.

“With over 10 years experience in the sector, local industry knowledge and competences spanning its entire value chain, Gumco has over the years established itself as an industry leader in the provisions of technical and commercial services to the electricity industry,” he insisted, adding that the company should be allowed to continue with the privatisation exercise from where PHCN has stopped, instead of allowing new entrants who have no antecedents in the industry