The Federal Government on Tuesday said it will embark on a
broader restructuring of the electricity sector to achieve a more
systematic power market design, especially for
renewable energy.
Following this, the government said it is exploring investment
opportunities for revolving funds for solar and other renewable
sources of energy to break the deadlock of electricity market
structures through ample competitions and ensure that renewable energy
becomes an engine of growth for Nigeria’s economy.
The government will also partner with the private sector, to create
the framework for real-world business cases by developing standardised
(and certified) technology packages, standardised contracts and a
toolkit for energy cooperatives (with technical, institutional,
financing and legal elements).
This is even as the Acting President, Yemi Osinbajo disclosed that the
government is about to release a second tranche of the N701billion
power assurance guarantee, approved by the Federal Executive Council
in March this year. The FG released the first tranche of about
N12billion to 10 GenCos from the N701billion intervention fund,
earlier this month.
Osinbajo made the disclosures at the inaugural Event of the Nigeria
Renewable Energy Roundtable organised by the Federal Ministry of
Science and Technology in partnership with the Nigerian Economic
Summit Group (NESG).
“We want to embark on a broader restructuring of the electricity
sector and strive to achievement a more systematic development power
market design especially for the renewable energy. To do that we need
a framework that brings together all stakeholders towards ensuring
that renewable energy becomes a real engine of growth for the Nigerian
economy.
“We have mentioned several of the plans, the power sector plans and so
many of those initiatives. The latest is to break the gridlock in the
liquidity of the entire electricity value chain and so our payment
assurance system of over N701 billion has been approved by the Federal
Executive Council and in fact the first payment has been made we are
onto make up the second payment.
“We hope that we free up that value chain which has created several
problems of its own and we hope that this injection will help. We are
also looking at several other reforms in the sector hoping that the
market can become self sustaining, independent and run on its own and
free up all of the private sector energy that is waiting to come into
the market.
“We also need to explore the opportunities for revolving funds for
solar PV/wind projects as well as opportunities for other investment
remuneration mechanisms. It is also very important that we break the
deadlock of electricity market structures by exploring the options to
transform the “competition for markets” approach, continue to embark
on a broader restructuring of the electricity sector and strive to
achieve a more systematic development of the power market design,
especially for renewable energy” he said.
According to him the administration’s plan is to expand the Solar Home
System program to 1 million households, creating a few more million
jobs.
The Acting President also noted that as a multi-stakeholder platform,
the Nigerian Renewable Energy Roundtable, therefore, has its work cut
out for it, which is to champion this new vision for renewable energy
and ensure that we can translate theory to practice for the greater
good of the people of Nigeria.
Earlier in his opening remarks, Chairman, Nigerian Economic Summit
Group, Kyari Bukar, said the cost comparison of the electricity
generation in Nigeria reveals that renewables are one of the strongest
options for Nigeria. Biomass, hydropower are currently competitive
with oil and gas despite the higher investment risks involved.
He said renewable energy are currently fully competitive with
conventional generation, adding that the debate on the need to
diversify the economy cannot be over emphasized. The principal
challenge amongst a myriad of other constraints is the demand for
energy required to positively impact productivity in Nigeria.
While the energy commission of Nigeria predicts that the energy demand
will increase exponentially by 2030. current generating capacity of
about 4,000 MW for a population of 170million clearly demonstrates
that Nigeria is facing an energy crisis.
Kyari listed some expectations Nigeria energy renewal round table to
boost the sector. Some of the listed expectations include the
establishment of regular renewable business dialogue platform with
renewal energy experts and rural electrification agencies to fine turn
action plans assign tasks, monitor progress
against targets, design and adopting of finance instruments to attract
high quality
solar companies to invest in off grid projects with hopes of at least
five solar companies for commencement of installations of at least 500
SMEs solutions, by January or February, 2018.
Others include the scale up of donor support for large scale training
programs for renewable energy technicians based on the already
existing plans, agree with the federal ministry of finance for tax
rates amongst others.
Chairman Senate committee on Science and Technology, Ajayi Boroface in
his goodwill message assured the ministry of science and technology
and the ministry of power as well as the Executive arm of government
that the national assembly will work with them to ensure that laws
needed to create an enabling environment to exploit energy resources
are put in place.
Chairman, House Committee on Science and Technology, Beni Lar in her
goodwill message also noted that the Nigeria’s power sector is one
that seems to have defied virtually every effort to resuscitate it
from the state of dilapidation.
“ Will there ever be an end to irregular power supply? she asked
adding that it is pertinent to also note that alternative uses of
sources of energy is key to shifting not only our focus away from the
traditional sources of power but to providing sustainable, steady,
safe, and regular supply of electricity in this country.
She added that very soon there will be a bill to regulate the
renewable energy sector.
ELIZABETH ARCHIBONG
