Success Nwogu 
A former Senior Vice President, Gas Commercialisation, Genesis Energy, Mr Patrick Udechukwu, has said that Nigeria should adopt a good transmission ownership model to accelerate power services in Nigeria. He noted that Nigeria needed improved power generation, transmission and distribution to grow the nation’s economy, fast-track industrialisation and improve the welfare, living standard and quality of lives of the residents. Udechukwu, in an interview with New Telegraph over the weekend, said the government should unbundle the nation’s transmission, bring in private sector investment, and retain the Transmission Company of Nigeria (TCN) as the regulator. According to him, this is a different model, which, he said, would expand the country’s transmission infrastructure quickly and not put more pressure on the public sector capital. He said the information that Nigeria’s national grid had grown from 13, 000megawatts recorded a few years ago to about 14,000 MW was not out of place. APGC’s Executive Secretary, Association of Power Generation Companies (APGC)Dr. Joy Ogaji, recently said electricity generation capacity to the national grid has increased to almost 14,000MW. According to her, the increase resulted by the addition of a $1.3bn Niger state-based 700MW Zungeru hydroelectric plant, which came on stream in the second quarter of 2023.
“The national grid now has an installed power generation capacity of about 14, 000 megawatts, and this was made possible due to the Zungeru plant that came on stream this year. It was an opportunity for interested investors to partner with the Gencos,” she said. Udechukwu said for the country to enjoy the increased wheeling capacity, there should be critical attention to the transmission.
He said: “It is interesting, we all know that the generation capacity for Nigeria over the last two to five years has been around the 12,000MW threshold and getting to 14,000MW is not really the stretch. The bottleneck is how much capacity can we wheel or can be transmitted. We have a lot of stranded capacity. We have been doing 12,000MW+ in terms of generation but we can only transmit 5,000+MW, so going to 14,000MW without handling the transmission bottlenecks is like putting the cart before the horse. “To enjoy the increased wheeling capacity, we really need to critically look at the transmission. We have been able to unbundle or privatise generation and distribution but transmission as it is, is currently handled by the govcent in middle-income countries.
“Significantly, remittance inflows often exceed foreign direct investment in countries that receive the most international remittances, underscoring their vital importance,” the report added. It also said South Asia, home to many remittance-receiving countries, for example, represented a remarkable 326 per cent of Foreign Direct Investment (FDI) inflows in 2022, up from 247 per cent in 2019. The report said: “Additionally, remittances were 1036 per cent of Official Development Assistance (ODA) to South Asian countries in 2022, an increase from 935 per cent in 2019.
“However, it is crucial to acknowledge that despite these impressive figures, remittancernment and that model is no longer sustainable for us. Now while I am not a proponent of privatising transmission, because the govenrment will still have the strategic segments, we must look at the model that will bring in capital to develop our transmission infrastructure. “The government is a very similar country to Nigeria in terms of demographics. Brazil has over 200 million people just like Nigeria. But if you compare Brazil’s transmission infrastructure, to Nigeria, you find out that Brazil has over five times the transmission capacity than Nigeria. In numbers, Nigeria has about 120 km per million people of transmission lines but Brazil has over 650k Brazilian people and over five times of Nigeria’s transmission capacity. The question is how did Nigeria get there? “They did that simply by bringing private investments to transmission through concessions and what they call independent transmission projects. So they started setting up stretches the way they will do concessions and PPP and private people will come in.” He added: “The transmission companies will remain the regulator but the private companies will come in, and bring in their capital to develop the stretches in which they will concession for the next 15 to 20 years. So over that period, the private companies will be able to recoup their investments but the assets remain with the company so it is not privatisation. It is a concession.
