By Obas Esiedesa, Abuja

Despite widespread blackouts across the country, it has emerged that only 53 percent of available power generation capacity in Nigeria was utilized in the past eight years due to gas supply shortage, transmission and distribution constraints, and commercial challenges.

Latest report by the Nigerian Electricity Regulatory Commission, NERC, covering a period of seven years revealed that in 2015 capacity utilization was 51 percent while it dropped to 46 percent in 2016. The figures for 2017 was 50 percent, 2018 was 52 percent, 2019 was 47 percent, 2020 was 53 percent, while capacity utilization for 2021 and 2022 were 56 percent and 61 percent respectively. Capacity utilization so far this year was put at 61 percent.

NERC estimated that grid energy demand in 2020 was 17,556 Megawatts while actual supply was 4,009MW, a mere 22.8 percent of energy demanded. It projected that demand would grow to 45,662MW by 2030.

According to the commission, nine of the 26 plants in operation accounted for 72.4 percent of the electricity generated in 2022. It however warned that the overreliance on few power plants may pose a risk to the Nigerian Electricity Supply Industry, NESI, because downtime in any of the plants may result in grid instability.

Transmission, distribution challenges remain

On the transmission end, NERC disclosed that the Transmission Company of Nigeria, TCN, recorded more losses than was allowed with transmission loss factor improving by just 0.81 percent points between 2015 and 2022. It pointed out that while the allowable transmission loss factor for TCN was 7.25 percent, in Ghana it was 3.5 percent.

The commission, which noted that TCN needed to improve transmission efficiency, added that compared to neighboring countries the frequent system collapses (89 times) recorded between 2015 and 2023 was embarrassing.

On the distribution end, the report stated that electricity supply has been hampered by high Aggregate Technical, Commercial and Collection (ATC&C) losses including energy theft, poor infrastructure and service quality, insecurity and community restiveness, huge debt by Ministries, Departments and Agencies (MDAs) of government at various levels, low metering, poor corporate governance, and low tariff.

DisCos, NERC move to adjust tariff

Following applications by the eleven electricity distribution companies, NERC last week began the process of adjusting the Multi Year Tariff Order (MYTO) which is expected to lead to a rise in tariff.

With a public hearing expected on the issue soon, consumers have described the process as talk shop and smoke screen.

In a note to Vanguard, President, Nigeria Consumer Protection Network, Mr. Kunle Olubiyo said the proposed public hearing was just to go through the motion and rubber stamp a decision that has already been taken by NERC and the DisCos.

He stated that “the proposed meeting by Nigerian Electricity Regulatory Commission on Upward review in Electricity Tariff is nothing but a mere talk shop and smokescreen designed to window dress a decision that has already been taken and concluded by NERC and DisCos”.

He expressed concern that there was still inaccurate data of electricity consumers in the country, adding that DisCos were also not making the needed capital investments into the network to improve quality of service.

“Near zero mechanism in place for cost recovery of investment in network improvement projects funded by customers with all the previous upward review of electricity tariff in Nigeria, which is recorded to be more than six in recent times. There has been no corresponding increase in service delivery, power generation, power transmission, load dispatch, load evacuation and energy load utilisation in spite of incessant increases in electricity tariff in Nigeria.

“Increasingly expanding huge metering gaps: Federal Government should provide the local meters manufacturers’ access to long term single digit credit facility at low interest rates to promote backward integration and job creation.

“Spike in volume of arbitrary estimated billing. Appropriate gas pricing 30- 50 percent of gas produced in Nigeria should be sold in Naira in furtherance of domestic gas obligations”, he stated.

Olubiyo observed that “at the end of the day, 100-200 percent increase in electricity tariff will not translate into improvement in overall efficiency in service delivery from upstream-to-downstream”.