22 November 2012

Nigeria: Kastina Solar Energy Project - Golden Chariot and Trojan Horse


The N13.7 billion 30mw solar project kicked off by Governor Ibrahim Shehu Shema in agreement with the Nigeria Germany Energy Partnership (NGEP) in which the German developers would develop and run the facility for 20 to 25 years is quite laudable coming at a time when energy crisis seem to defy any solution.

However, Public-Private Partnership (PPP) being a contract between a public sector authority and a private party, in which the private party provides a public service or project and assumes substantial financial, technical and operational risk in the project,there is need for the government to be more forth coming with the terms of agreement of the partnership without ambiguity. For instance, the Katsina State government should tell the people the equity share of the government in this project for the purpose of evaluating the expected returns on investment (ROI).

While exposing myself to the danger of being termed an alarmist, such fear would not deter me from asking for a fair deal for the people by demanding for probity and accountability. Already there are palpable fear about the non commission of the late Yar'Adua initiated 10mw project in Lambar Rimi. This fear was amplified by the management of Vergnet Engineering Company, the contractors. The company reportedly assured that the project was completed and ready for commissioning.

The only thing delaying the commissioning was the inability of two of its engineers to come from France to inspect the equipment because they could not get visa for them. This sound really silly and sure rings a warning bell. I don't think there is any country, least of all Nigeria that will deny people with evidence of contractual agreement visas to come and inspect their investment. However, let's not jump the gun.

I should be happy that this project is located within my constituency but, even that would not deter me from ensuring things are done the right way. In any case, locating the project in my constituency was simply a matter of technical convenience.

With an existing power sub station located in Kankia for easy upload of any generated electricity from the project I can't think of a better place for a location. Perhaps without that technical convenience, another neighbouring local government might have been home for the project. Having said that, let's analyse the major aspects of the joint project

Most public-private partnership project comprises high level of risk, due to the magnitude of financial stakes involved; uncertainties over construction and operating costs, and revenue-related uncertainties. There has to be balanced allocation of risks between public authority and private sector.

The public becomes the loser in the event of any miscalculation (intentional/accidental); as such we demand the government to be open with the processes of this laudable achievement. It should be noted that many such seemingly laudable PPP initiatives were proven to be loaded with ambiguities that create a convenient window for siphoning public funds with a moratorium period long enough to allow a clean escape.

Much as the people of the state appreciate the laudable effort of resolving the energy crisis in the state it should not come with a higher price than ordinarily obtainable. For instance, it is important that the government inform the public what is their share of liability as well as the risks involved. Overtime, these kind of public-private partnership have been proven to be vehicles of corruption that were always commissioned with fanfare only to be abandoned as white elephant projects at a time when most people cannot recall the details of the contractual agreement.

Without a doubt, any government with itchy fingers, especially one confused about what define public funds will not hesitate to use this kind of window of opportunity to make some money. It was speculated that the current regime in Katsina was reported to have declared that a certain on-going project in the state capital is not being financed by public funds but by interest generated from the accounts of the government. What a misnomer.

A government with such a confusing view and definition of public funds is not one I can sleep with my two eyes closed when it starts talking of executing a project with. financial life span of 10 to 20 years. It is ample moratorium to cover the potential sleaze that may be uncovered when both partners are no longer on the radar of the state.

I may be accused of pessimism, but my deep conviction about the way and manner Katsina State is being governed which does not reflect service-oriented development has forced me to prepare for the worse. I am not being a pessimist by choice but rather by the force of history of this regime which is littered by haphazard legacies designed to hoodwink the public to demand credit where non exist. I don't intend to be naïve by swallowing hook, line and sinker when I can demand for details of this "trojan horse".

Even an elementary student of politics in Nigeria can write a convincing thesis about the tricky stunts of politicians when they are desperate to hide their footprints. It should be clear to all that all tricks to sustain the rot in the state is being deployed. No one is left out of the lucrative business of painting the regime in glowing colours.

As such, it is time leaders in position of authority begin to appreciate the sad situation of their people by not resorting to such glib display of disconnect with them. This is how best to preserve the respect of these institutions. Already, the people are disenchanted with the sums of money deducted monthly from statutory allocations of local governments meant for service to the people to maintain this institution with minimal corresponding output.

- Kaita represents Kankia/Kusada/Ingawa Federal Constituency in the House of Representatives

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