Participants at the PwC Annual Power and Utilities Roundtable have called on next administration that would be sworn in on May 29, 2023, to declare a state of emergency in Nigeria's power sector.
The declaration of a state of emergency in the sector, according to the stakeholders, would aim at solving the lingering crisis of inadequate power supply in the country.
The PwC stated that the roundtable, whose theme was, "Setting a New Power Agenda Post-2023 Elections," revealed that "stakeholders across Nigeria's power sector value chain, from transmission, distribution, generation and renewable energy operators, have different perspectives on the policies required to solve the challenges in the sector.
"Furthermore, it was apparent that political actors often have bold ambitions that drive policymaking but sometimes are not consistent with the pragmatic realities in the industry. This misalignment hampers a collaborative approach towards solutions."
However, stakeholders at the roundtable agreed on the need to formally recognise the electric power crisis in Nigeria and for the new government post-2023 elections to convene a stakeholders' summit.
The Partner and Energy, Utilities and Resources Industry Leader, PwC Nigeria, Pedro Omontuemhen, said: "Irrespective of your political affiliation, we can all agree that electric power is critical to our development as a nation.
"But there are several perspectives on the key solutions and policies that Nigeria should pursue to solve the crisis in the power sector. So there's a need for all stakeholders and the incoming government to dimension the challenges and agree on the key policies to implement.
"This alignment is urgent if the incoming government is to deliver a sustainable and stable electric power supply in Nigeria."
In his keynote address, Former Chief Executive Officer of Nigerian Electricity Regulatory Commission, Dr. Sam Amadi, who delivered the keynote address titled, "How to Solve Nigeria's Energy Problem," reviewed the power sector policies of the presidential candidates of the three leading political parties.
Amadi, however, proposed the restructuring of the Transmission Company of Nigeria (TCN) and the constitution of a presidential task force that would "drive power sector reforms and restructure the Niger Delta Power Holding Company (NDPHC) to release its 4000 Megawatts generating capacity."
He also proposed extending invitations to local and international developers to sign new PPA for 800 Megawatts of solar/wind in Lagos/PH/Warri by 2025.
The stakeholders also identified ongoing power sector interventions and critical and impactful reforms the incoming administration should continue to implement post-2023.
The Director General of Bureau of Public Enterprises, Mr. Alex Okoh, noted that some ongoing reforms targeted at the GENCOs have worked and should continue.
According to Okoh, a legacy GENCOs firm that was privatised and listed on the stock exchange is currently attracting favourable attention from the public, which he described as an independent test of the viability of that business.
The Component Lead, Standalone Solar Home Systems (SHS), Nigeria Electrification Project, REA, Ms. Lande Abudu, said that the has deployed over one million units of solar energy facilities that have been impacting over five million Nigerian households.
The Managing Director of Azura Power West Africa Limited, Mr. Edu Okeke, highlighted the positive impact the licensing of mobile money would have on the renewable energy space by emboldening investors' confidence that they could easily collect their payments from the consumer.
A former Managing Director of the TCN, Dr. U.G Mohammed, noted that one of the laudable reforms in the power sector was the cessation of government-to-government agreements with neighbouring countries, which paved the way for GENCOs to sign bilateral agreements directly with their governments.
Mohammed stated that a bilateral agreement is preferable to the single buyer regime.
The Partner, Energy, Utilities and Resources, PwC Nigeria, Mr. Akinyemi Akingbade, who moderated the panel session, noted that a vital aspect of PwC's purpose is to solve important problems.
"For the past 14 years, this forum has brought stakeholders together to discuss topical issues affecting the power sector and propose solutions. We are proud of some of its successes, and keen to collaborate with other stakeholders to chart a path forward."
Meanwhile, the African Export and Import Bank (Afreximbank) assured marginal oil field operators in Nigeria of adequate financial support that would enable them to drill more oil and stop gas flaring.
The bank gave this assurance recently in Lagos during the PwC Nigeria's Oil and Gas Stakeholders Forum with the theme "Marginal Oilfield Licence: After Winning, What Next?"
The Afreximbank's Head of Client Relations (Anglophone West Africa), Mr. Peter Adeshola Olowonomi, explained during the stakeholders' forum that the bank's support would be enjoyed by marginal field holders that have achieved initial crude oil production.
Olowonomi added that the bank could provide guarantees to pay contractors and to service providers who have expertise do the work once there is proof that they have struck oil.
He said: We are an African bank and so even when the international institutions fail to provide financing on the continent; we as an African bank have no choice than to provide the funding.
"But we have risk and acceptable criteria that these marginal field holders must meet before we can provide them with the financing. In this case, we have said that they must get their first oil, meaning that they must go into the asset using their shareholders' equity to develop the asset and bring out the oil.
"Once it is proven that oil has started flowing, based on this production we can then give them loan to put infrastructure in place to ramp up their production and drill more wells."
Olowonomi disclosed that the bank is also considering a creative structure that would enable it to "give guarantees to contractors and service providers who can do the work and bring the oil out, then pay them once the oil is achieved.
"You should be pleasantly surprised that Afreximbank gave letter of interest to over 50 per cent of marginal field owners in this shareholders' forum to support them during their bidding stage.
"It is not a discussion that is starting now. We have started with them even when they were bidding for these assets via letters of support."
He said that being an export oriented bank, the Afreximbank would give them money to buy the turbines to monitise the gas. "As I mentioned, we are supporting Notore fertilizer. We supported the construction of Indorama facility and we are refinancing the NLNG project.
"As oil is being produced, we are able to give them financing so that the gas that is produced will be used for fertilizer, electricity and for LNG. So that there will be no more flaring of gas.
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"Afreximbank is supporting today a company called UTMFLNG that not only wants to take the gas to power but also liquefy the gas and put it in vessels for export.
"And that is our intention that by the time we do all of these, Nigeria can generate more dollars to boost its budget. The pressure on the Naira is because the dollar receivables are not as much as they can be. And we want to reverse that trend as an institution," he said.
Also, Omontuemhen, admonished the firms not go it all alone but to look for joint partners rather than joint venture, adding that the most important thing is what comes next after the bidding, which is drilling and producing oil.
Omontuemhen said the essence of the forum was to enable older operators of marginal oil fields to share their experiences with new entrants into the sector.
He said: "The idea is to share experiences from very experienced people who will tell us what they did right or did wrong and what mistakes they have made and what the new entrants should avoid in order to succeed in this business."
He also said the forum would enable them to learn how to structure their loan requests in such a manner that financial institutions would be willing to assist them.
Omontuemhen advised marginal oil field holders to avoid going into operation alone. "My first advice to them is: do not go it alone. You need other people to partner with you. It should be joint partnering as against joint venture.
"Collaborate with other people so that you can succeed together. Do not die alone and do not die in silence. Call for help," he said.
