In the face of electricity challenges, the Federal Government is seeking to leverage the Niger Delta Power Holding Company (NDPHC) for industrial growth under the administration of President Bola Tinubu. This initiative follows a series of business roundtables led by Vice President Kashim Shettima, who also serves as the Chairman of the Board of Directors of the organization. 
   
The Federal Government had previously established the NDPHC as a limited liability company to act as the legal vehicle for holding the National Integrated Power Project (NIPP) assets, utilising private sector-oriented best business practices. Despite the country’s electricity capacity being limited, over 5,000 megawatts available through the NDPHC have not been fully distributed to end-users due to infrastructure bottlenecks at the transmission and distribution levels. 
    
Shettima led the management team of NDPHC to the OPIC Industrial Estate in Agbara, Ogun State, assuring industry owners of Federal Government’s commitment to circumvent infrastructure challenges and provide electricity through NDPHC in a more affordable and sustainable manner. The bilateral power purchase agreement is expected to offer businesses electricity at a rate 60 per cent cheaper than their current energy costs.
    
Currently, none of the businesses operating within the Agbara industrial cluster utilises energy from the national grid. Shettima assured that NDPHC will supply the necessary power within the next six months. The increasing number of factories shutting down yearly due to power shortages and challenging economic conditions is alarming. Stakeholders have expressed deep concerns that without immediate action, job losses and revenue declines from the sector could significantly impact the nation’s economic growth and its contributions to the Gross Domestic Product (GDP).
    
In the second quarter of this year, manufacturers experienced a 17.3 per cent increase in the costs of production and distribution. Capacity utilization dropped by 5.6 per cent, the volume of production contracted by 6.1 per cent, manufacturing investment decreased by 5.6 per cent, employment fell by 5.7 per cent, sales volume plunged by 6.3 per cent, and the cost of shipping rose by 14.3 per cent.
    
The Manufacturers Association of Nigeria’s Confidence Index for the second quarter identified the high cost of energy as the primary challenge facing manufacturing in the country, compounded by issues such as high credit costs, lack of loanable funds, multiple taxes, charges, levies, inconsistent tax policies for local producers and importers, raw material unavailability, delays in receiving imported raw materials, high raw material costs, forex scarcity, high exchange rates, and poor forex allocation.
    
With the nation’s electricity grid proving unreliable for manufacturing activities, experiencing over 134 system collapses in the last decade, manufacturers have spent nearly N1 trillion on alternative energy sources in the last seven years. They spent N129 billion in 2016; N117.38 billion in 2017; N93.11 billion in 2018; N61.38 billion in 2019; N81.91 billion in 2020; N71.22 billion in 2021 and N144.3 billion in 2022. On average, 95 manufacturing companies shut down yearly, with GlaxoSmithKline Plc being the latest casualty, resulting in over 4,451 job losses yearly in the manufacturing sector alone. Factory output value also dropped to N2.68 trillion in the first quarter of 2022 from N3.73 trillion in the first quarter of the previous year.
    
The Managing Director of NDPHC, Chiedu Ugbo, stated at the business roundtable that the agency is committed to and prepared for collaboration with partners to undertake bilateral electricity sales to end-users. He said the primary goal of this initiative is to ensure a consistent, reliable, and cost-effective supply of electricity from NDPHC’s power plants to extensive industrial and business clusters in Agbara and throughout Nigeria.
   
“NDPHC is a wholly-owned government company responsible for implementing the National Integrated Power Project (NIPP), which aims to enhance electricity generation with associated electricity transmission and distribution infrastructure, for the benefit of Nigerians.
    
“NDPHC has successfully constructed eight power plants with a combined capacity of approximately 4000MW and transmission and distribution infrastructure. The evolving regulatory framework of the Nigerian Electricity Supply Industry (NESI) and the declaration of eligible customers present opportunities to revolutionize the industry through end-to-end solutions that increase electricity access for Nigerian homes and businesses and alleviate the financial burden on the Federal Government’s balance sheet.
   
“NDPHC remains at the forefront of the industry in pursuing bilateral power sales and other projects that ensure efficient and targeted power delivery to end-users. The agency is grateful for the political support of the Federal Government, represented by the Vice President, and the state governments, represented by the Executive Governors of Ogun and Lagos States. Despite the celebration of the recent event, there is still substantial work to be done to successfully implement the programme and deliver consistent, reliable, and affordable electricity to Nigerian industrial clusters,” he stated.
   
Ugbo affirmed NDPHC’s unwavering commitment to the successful execution of the project, not only in Agbara but also in various locations across the country. “Aside from the OPIC industrial cluster at Agbara, we are ready to supply electricity to other industrial clusters in Nnewi, Port Harcourt, Kano, and others. We recently signed an agreement with Ibadan Distribution Company.

We will put a system in place that will allow us to collect our tariffs and also ensure the security of supply. Just a few days ago, we signed a framework agreement with Ibadan DisCo to supply power directly to industries around Shagamu.
   
“We are equally ready to work with partners in supplying electricity to residential areas directly on a bilateral basis. All it takes is to minimize technical losses, which has to do with poles and wires; commercial losses, which has to do with technology in order to ensure that there is no power theft or that power theft is reduced and of course, eliminate collection losses, which has to do with metering.”
   
The Federal Government mandated NDPHC to develop 10 power plants with a designed ISO capacity of 5,067 MW. The company said eight of the power plants, with a capacity of about 4,000 MW, have been delivered along with associated gas transmission metering/receiving infrastructure projects to support commercial operation, and have been commissioned and connected to the national grid, contributing over 22,000,000 kWh of energy daily, subject to the availability of gas. 
   
“NDPHC has over 3,000 MW of generation capacity available for deployment if the grid permits, and this represents the best opportunity for the rapid improvement of power supply to the teeming Nigerians. It is important to note that completed power plants include 750 MW Olorunsogo II, 450 MW (Ogorode) Sapele, 434 MW Geregu II, 450 MW Omotosho II, 450 MW Ihovbor, 450 MW Alaoji, 563 MW Calabar, and 225 MW Gbarain. The 225 MW Omoku, 338 MW Egbema, and 530 MW Alaoji steam machines would wrap up the total available capacity of the plants to 1,774 MW on full completion. 
   
“Many of the NIPP power plants on the national grid also provide ancillary services like spinning reserve to support the system operations, a contribution critical for stabilizing the national grid,” the company noted on its website. It also noted 2,194 km of 330 kV transmission lines and 809 km,” he stated.