Nigeria: Future Looks Bright As Govt Takes Steps to Tackle Problems in Power Sector - MD/CEO, Siemens

20 August 2019

The Federal Government and Siemens Limited, Nigeria, recently sealed an agreement to reduce power loses in the nation. In this interview with Udeme Akpan, the Managing Director/CEO, Siemens Limited, Ms Onyeche Tifase, provides an insight into the deal, including how the company will go about achieving its target.

How did the power deal between Siemens and the Federal Government of Nigeria start?

The German Government has assisted many nations around the world to tackle their electricity problems. It was in the same spirit that the German Chancellor, Angela Merkel visited President Muhammadu Buhari on August 31, 2018, to learn that Nigeria has serious power problems. It, therefore, decided to assist through a government-to-government approach.

What is the total cost or value of this deal and the major tasks before Siemens?

The mandate is given to us is very clear. We have been tasked to identify all issues and problems, involving transmission and distribution, confront them in order to deliver more power to consumers. Specifically, we are to review the sector which currently has high transmission and distribution losses that prevent all generated electricity from getting to consumers. It should be noted that Nigeria currently has the capacity to generate about 11,000mw, transmit 5,000mw, of which only about 3,500mw can be delivered to consumers because of many reasons, including, inadequate and poor infrastructure as well as an obsolete technology, which discourage new investment in generation.

So, what have you been doing before and after the recent signing of the agreement?

Siemens has been meeting with many relevant stakeholders, including the Ministry of Works, Housing and Power, Bureau of Public Enterprises [BPE], Transmission Company of Nigeria [TCN], and Electricity Distribution Companies [DISCOs], in order to fully understand all the issues and challenges in the sector. The comprehension of the various issues was essential in developing an appropriate intervention, which the government approved for implementation. Our intervention is expected to eliminate all bottlenecks, overhaul and stabilise operations, targeted at achieving maximum power delivery to consumers at a tariff level that would be attractive to investors, required to further increase generation, transmission and distribution of power.

How will your experiences in Egypt and Iraq impact on your current assignment in Nigeria?

We have experiences working in many nations, including Egypt and Iraq. Although these nations are different, the invaluable experiences will go a long way in enhancing our work in Nigeria.

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How realistic is the government plan to hit 7,000 megawatts [mw], 11,000mw and 25mw in 2021, 2023, and thereafter?

It is a very realistic plan. As a company, we have already demonstrated our competence with the completion of the construction of Azura plant, which has the capacity to generate commercial electricity. Now, we have been tasked to ensure 7,000mw, 11,000mw and 25,000mw of power are delivered to consumers by 2021 and 2023, before further up-scaling supply to 25,000mw.

Since Nigeria currently has the capacity to transmit about 5,000 MW, our focus is to address all the issues to deliver additional 2,000mw, thus increasing its 7,000mw between now and 2021. More efforts will be made to hit additional 4,000mw, thus realising the targeted 11,000mw by 2023. The realisation of 25,000mw will require the massive deployment of conventional and non-conventional means or resources, including gas-powered and renewables.

What are your medium and long-term plans in Nigeria?

Siemens is here to stay in Nigeria. Consequently, we will continue to intervene through projects and programmes capable of delivering lasting value to all stakeholders, including the government and consumers of electricity.

Specifically, what major problems abound in the sector and how do you think they can be solved?

Our engagement with major stakeholders already showed that many challenges, including pipeline and other forms of vandalism, poor facilities, inadequate infrastructure, lack of liquidity, obsolete technology, energy theft, illegal connection and low tariff currently haunt Nigeria's power sector. Siemens and others have started working to address these and other issues.

Are they prospect, will Nigeria be able to tackle all these problems and deliver adequate power to consumers, including private investors in various sectors?

The prospect is very high, after all, every nation has a journey. First, Nigeria is endowed with many resources such as crude oil, natural gas, water and wind, which could be harnessed to generate, transmit electricity to consumers. Second, the nation is blessed with qualified and experienced human capital. Third, it also has institutions, systems and processes to enhance activities or efforts that could lead to the development of the sector. Fourth, the government and others have expressed their determination to change the poor state of the sector.

Already, the President Buhari-led government has taken bold steps to tackle issues in the power sector. The future looks bright considering the support and cooperation we have so far received from relevant stakeholders.

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