Afrigather 
By Ifeanyi Ukwuoma
I intend to write down a complete 3-part collection delving into the intricate dynamics of Nigeria’s energy sector.
In Half 1, I staunchly advocate that the present operational framework of on-grid and centralised energy technology and transmission serves as the first bottleneck restraining the event of Nigeria’s energy sector. This assertion shouldn’t be made calmly however is fairly grounded in a deep evaluation of the systemic points plaguing the nation’s electrical energy infrastructure. From frequent grid collapses to erratic energy output, the proof overwhelmingly factors to a centralised system struggling to fulfill the calls for of a quickly rising inhabitants.
Learn additionally: How Nigerians can survive new electricity tariff hike
In Half II of this collection, we are going to delve into the character of cost-reflective tariffs. Lately, the Nigerian Electrical energy Regulatory Authority (NERC) made headlines by saying a considerable 300 p.c upward assessment of electrical energy prices for Band A prospects. Charges skyrocketed from N68 per kilowatt-hour to as excessive as N225 per kilowatt-hour. NERC attributed this adjustment to the idea of “cost-reflective tariff,” indicating a major shift within the pricing construction.
Half III will shift its focus to Lagos State. Because the financial nerve centre of Nigeria, Lagos grapples with acute electrical energy shortages regardless of being dwelling to substantial producing capability. The irony of Lagos producing extra energy than it receives from the grid underscores the inefficiency inherent in Nigeria’s centralised electrical energy market. By dissecting the intricacies of Lagos’ power panorama, together with the operations of its resident electrical energy distribution firms, Eko and Ikeja, we will elucidate the systemic flaws hindering environment friendly energy distribution.
For these unacquainted with my background, I’m each an power coverage analyst and guide. Because the Founder and CEO of Highly effective Expertise Restricted, my endeavours have been devoted to pioneering progressive options to Nigeria’s power deficit, notably by way of energy-driven financing mechanisms. This primary-hand expertise gives me with distinctive insights into the challenges and alternatives current in Nigeria’s energy sector.
There are a number of causes for sure occurrences, however typically, it comes down to at least one principal causative issue. A lot may be stated in regards to the the explanation why electrical energy provide shouldn’t be reasonably priced and dependable in Nigeria, however as I’ll argue, there’s a definitive single purpose behind it. This purpose may additionally be why Aba has practically 24 hours of electrical energy and will function a mannequin for the Nigerian energy sector.
The crux of the matter lies in Nigeria’s reliance on a single grid-connected producing and transmission system. This centralised method mandates that each one electrical energy generated throughout the nation should traverse the nationwide grid earlier than reaching its supposed locations. For example, the power generated by the 1,320MW Egbin Energy Plc in Lagos State should first funnel into the nationwide grid, with solely a portion subsequently channelled again into Lagos. Consequently, Lagos, like the remainder of the nation, depends closely on the nationwide grid for its electrical energy wants, a reliance that always falls wanting assembly demand.
This imbalance turns into obviously evident when juxtaposed in opposition to Lagos’s substantial energy technology capability relative to its grid allocation. The irony is palpable as Lagos generates a surplus of 1,320MW whereas receiving a mere 1,000MW from the nationwide grid. Such inefficiencies underscore the pressing want for a decentralisation in Nigeria’s electrical energy market construction.
Learn additionally: Time to activate green energy and the Electricity Act 2023 following the electricity tariff hike
Let’s talk about transmission. Electrical energy transmission in Nigeria is managed by the Transmission Firm of Nigeria (TCN), serving as a System Operator. TCN manages the motion of power throughout the grid in accordance with the Grid Code. All energy, distribution, and substations are interconnected by a transmission community often known as the nationwide grid. The complete electrical energy generated nationwide is pooled into the Nationwide Management Centre in Osogbo, from the place it’s distributed to all elements of Nigeria.
The irony is now clear. We regularly talk about the devolution of energy from the central authorities to its federating models in political discussions in Nigeria. That is exactly what Nigeria wants in its energy sector. Nevertheless, the crucial for decentralisation can’t be overstated, notably within the context of empowering federating models similar to states to generate their very own electrical energy as a viable various to the present centralised mannequin. But, realising this imaginative and prescient necessitates a concerted effort to ascertain an enabling constitutional and authorized framework, coupled with an autonomous regulatory physique able to integrating decentralised technology assets right into a bankable business framework.
Be a part of me in Half II as I delve into the character of price reflective tariffs.
Ifeanyi Ukwuoma is an Vitality guide and CEO of Powerfull Expertise Restricted; a photo voltaic financing firm primarily based in Lagos, Nigeria.
