The private sector is key to the realisation of the $24.5 billion finance need- ed for Nigeria to actual- ise its 30,000 MW target by 2030. According to expert opinion, government should rather than provide the funds or embark on the projects ensure that there is a conducive environment that is enabling for private sector par- ticipation. Recall that the immediate Federal Minister of Power, Ali- yu Abubakar, during the Solar Power Naija Program Investor Matchmaking, had stated that Ni- geria needed $24.5 billion to reach 30,000 megawatts (MW) by 2030. Throwing light on the develop- ment, the Senior Vice President, Gas Commercialisation, Genesis Energy, Mr Patrick Udechukwu, in an interview with New Telegraph over the weekend, opined that pri- vate sector capital mobilisation and resources were incumbent for Nigeria to raise the $24.5 billion and reach the 30,000 MW target. He stated that the 30,000MW was interesting and possible to actualise. He, however, stated that to achieve it, there are strategies that should be pursued.
Udechukwu said: “A couple of things have been set which if properly executed will get us there. The Presidential Power Initiative (PPI), which has Ni- geria and Siemens has a target of 25,000MW by 2025 0r 2025. If only that is followed, that will tell you that we are almost there. That is not putting into the mix the renewables: solar and hydro capacity, the Presidential Power Initiative is largely gas-powered. It is an upgrade of our transmis- sion and distribution systems as well. The reality is that the funds required to get us there can not be provided by the government or public sector. “So private sector capital needs to be mobilised. So the essence is for us to be able to build our skills which is what we are trying to do. Right now, our over- all generation capacity is prob- ably close to 12,000 or 13,000 MW. “But the reality is that our network can only wheel about 5,000MW. What we are now looking for is to doable that generation capacity to 25,000MW or 30,000MW and also to be able to wheel the capacity.
So focus has to be given to the challenge is the transmission and distribution network have to be. “Otherwise, we will be having generation capacity that is stranding. That is what the PPI is trying to do because it understands that we invest all these generation capacity and without the transmission and distribution, the efforts fall. “For us to build our skills, we need to mobilise private capital. The government’s role really should be an umpire to build a platform. You look at examples of how these things have been done, when I see the government trying to invest in power plants, I say its priorities have been misplaced. “Build skills, you do not build units, you build the platforms and you lead the market to build the units. The government needs to build the platform and ensure that the enabling environment is there, politically, and legally.
There has to be a lot of leverage on public-private partnerships. It is very important.” He added: “The government should completely step away from even investing and putting its money into building things like power plants whether it is a hydro- power plant, which I know the government is trying to build at the moment or a gas power plant. “It is just not their role. They have to set up the platform and al- low the market to do it. Their role is just that of a regulator, and help- ing investors to be able to find the money attractive to sink in their capital and get their returns. The private sector must be mobilized for that capital to come in.” Energy renewables mix such as solar and hydro should be deployed in the nation’s quest for 30,000MW by 2030. It is also important for gas to be allowed to play a formidable role in the energy target strategy. Udechukwu said: “The role of gas is very critical to get us there. There are three aspects to gas, we are in the era of transiting from carbon emission to sustainability, or lesser emission.
Gas has a very critical role to play because it dis- places dirtier fuels. “Things like diesel and coal have been used for many years in the industry. Gas can play the role of displacing these dirtier fuels. Again gas back-stops the intermittency of renewables. The technology for renewables, as advanced as it has been and cost-effective as it is, is still in- termittent. It can not cover base low. So gas is a very critical bridge to provide diesel power for industries and commercial areas that are really the largest users of power. “When you look at Liqui- fied Natural Gas (LNG), for example, it begins to provide a deliberate mechanism for fu- ture fuels like hydrogen which has been touted to be the fuel of the future. How LNG is de- livered over the years and the infrastructure of LNG delivery, provides the platform for the delivery of hydrogen in the future.
That is being test-run already around the world. Gas has a very critical role to play. “If you look at Nigeria, every- body knows that we are more of a gas producer than oil. We have more gas than oil, we have many years of gas reserves compared to oil remaining. We have over 200 trillion cubic feet of gas. So gas development is crucial. There must be an incentive for the development of LNG. In Nigeria, we just have one LNG producer, which is the Nigeria Liquified Natural Gas (NLNG). Greenville is a private company that has come in for the domes- tic market. But NLNG has al- ways been there for export.” He stated that recently, NLNG signed a 10-year sales and purchase agreement with three Nigerian companies for domestic services where it wants to begin to provide LNG for the domestic market. According to him, such is the kind of strategic thing that Ni- gerians need to ensure greater gas utilization and that they are married with renewables such as solar and hydro powers.