Friday, 1st December 2023

Despite $7.5b investment, TCN lapses, rot push grid collapses to 138 in 10 years

By Kingsley Jeremiah (Abuja) and Waliat Musa (Lagos)
15 September 2023   |   4:40 am
Poor management of the Transmission Company of Nigeria (TCN), especially the national electricity grid, where over $7.5 billion has been invested in the last 10 years, yesterday, led to the collapse of the system, bringing the collapse to 138 since the power sector was privatized.

Transmission Company of Nigeria

• DisCos, GenCos suffer as economy records N3b losses to nationwide blackout 
• NERC’s contract fails to instill market discipline despite SBT
• TCN announces grid restoration, blames fire incident for collapse 
• No public power supply yet in Abia after restoration, consumers lament

Poor management of the Transmission Company of Nigeria (TCN), especially the national electricity grid, where over $7.5 billion has been invested in the last 10 years, yesterday, led to the collapse of the system, bringing the collapse to 138 since the power sector was privatized.

Coming barely a few days after TCN rolled out the drums over a misleading celebration of 400 days of no system collapse, the grid system, in a double jeopardy, collapsed at 12:40a.m. on Thursday, only to go down again at 6:40a.m. (six hours interval).
Data on grid collapse showed that in 2013, the country recorded 24 power system collapses. The collapse incidents stood at 13 in 2014. In 2015, the grid collapsed 10 times; in 2016, it rose to 28, while 21 cases were recorded in 2017.
Grid collapse cases in 2018, 2019, 2020 and 2021 were 13, 11, four and four, respectively. It collapsed about 10 times between 2022 and this year.
A check by The Guardian in the early hours of yesterday showed that the grid plummeted to a meager 273 megawatts in the initial collapse and went to 1:60 megawatts of electricity as of 7:00a.m. after the second collapse.
A number of Distribution Companies (DisCos) confirmed to The Guardian that the grid went down at 00:41a.m. and 7:40a.m. as the TCN, admitting to the development, linked it to a fire incident.  
Enugu Electricity Distribution Company PLC (EEDC) in a note to consumers confirmed the double collapse. The development, according to the company, resulted in the loss of supply experienced across the Southeast.
“Due to this development, all our interface TCN stations are out of supply, and we are unable to provide service to our customers in Abia, Anambra, Ebonyi, Enugu and Imo states,” Head, Corporate Communications, EEDC, Emeka Ezeh, noted.  Yola DisCo, which powers the Northeast, equally confirmed the development, stating that their feeders are out of supply. 
Recall that Nigeria had borrowed over $7.5 billion from the World Bank, African Development Bank (AfDB), Japan, France Development Agency and other financiers to improve the weak wheeling capacity of the transmission network and the grid.
But stakeholders insisted that gross management bottlenecks that reflect the pre-privatization practices, widespread corruption, political considerations, non-alignment of infrastructure, and the inability of the DisCos to increase their off-taking capacity, among other factors, have made the kind-heartedness of the lenders meaningless and government efforts futile.
Aside from the $2.3 billion Siemens deal, which was targeted at improving transmission infrastructure, Nigeria had taken a $486million-loan from the World Bank under the Nigeria Electricity Transmission Project (NETAP).
Japan also extended a $242.4 million loan to the Federal Government for the implementation of the Lagos and Ogun Power Transmission System Improvement Project, just as the House of Representatives in 2017 disclosed that foreign loan to the TCN totalled $1.5 billion, with a separate $500 million loan being negotiated with the Islamic Development Bank (IsDB).
Recall that the IsDB last year approved a total financing of $1.8 billion for Nigeria with the electricity loan expected to be a part of it. Former Minister of Finance, Zainab Ahmed, had in 2020, said the Federal Government requested a $3 billion World Bank loan to finance the transmission network. The fund was provided in four tranches of $750 million each.
The African Development Bank (AfDB), in 2019, further approved a $210 million loan for the upgrade of the electricity transmission and distribution network.
While GenCos and DisCos had decried the impact of grid collapse on machines and revenue, the prevailing situation remained a violation contract signed between TCN and Nigerian Electricity Regulatory Commission (NERC) to ensure that minimum of 5,000MW is transmitted through the grid under the Service Based Tariff (SBT).
Amidst other implications, the collapse of the grid cost end-users in Nigeria about N3 billion per day. Nigerian Bulk Electricity Trading (NBET) Plc had earlier stated that electricity invoices in the country average N60 billion monthly from the national grid, translating to about N720 billion every year. With existing subsidies being incurred by the government, the daily cost of a collapse hovers around N3 billion.
 Reacting to yesterday’s incident, the Minister of Power, Bayo Adelabu, said a fire outbreak ‘with explosion sound’ on Kainji/Jebba 330kV line 2 (Cct K2J) blue phase CVT & Blue phase line Isolator of Kainji/Jebba 330kV line1 caused the collapse. 
“We are on top of the situation and speedy restoration is in progress. The fire has been fully arrested and over half of the connections are now up and the rest will be fully restored in no time. My sincere appreciation to those who responded or expressed concern via different channels and the team of engineers for their prompt response to the situation and work done so far. Let’s get the restoration work completed as soon as possible. Delay in update was deliberate, so as not to cause panic,” he said.
TCN noted that in the course of the grid restoration, the process initially suffered a setback, stressing that the development does not amount to another collapse. In the course of any grid restoration process, TCN may encounter challenges. This happened today while the grid restoration was in progress, but it was promptly addressed. Partner, Head Mining Sector Business Development, Habeeb Jaiyeola, said the sector needs to work on avoiding grid collapse at all cost. 
“Apart from the power outage, the resultant matters, which may occur, are usually not analysed. Significant loss of value across different sectors of the economy would reflect the impact of the grid collapse,” he said.
 Jaiyeola said the extent of government and private sector investment in the sector needs to be appraised to determine the value achieved so far, stressing that the cause of prevailing collapse should be investigated and solutions to avoid repetition need to be executed. By mid-afternoon, the grid was fully restored with the TCN reiterating that Thursday’s development was the first in almost one year.
“The collapse that occurred after a fire incident on Kainji/Jebba 330kV line 2 is being investigated, with the view to forestalling future occurrence and invariably further strengthen the grid,” the agency’s General Manager, Public Affairs, Ndidi Mbah, said in a statement.
“Following the recent development, TCN is assuring Nigerians that grid restoration nationwide is in progress and has reached advanced stages with power supply now available in the West, North Central, South, East and a large portion of the Northern parts of the country.”
Mbah noted that prior to the collapse, the system had been stable in spite of the challenges posed by zero spinning reserve and lack of System Control and Adequate Data Acquisition (SCADA), essential for a strong and stable grid, among others
But despite claims that power had been restored nationwide after the collapse, there was no public power supply in Abia State as at press time yesterday. Umuahia, the capital of Abia State, was still in darkness as at the time of filing this report.
The Eko Electricity Distribution Company (EKEDC), had in a statement on X, announced that the collapsed national grid had been fixed, and public power supply restored nationwide and this was the situation in many parts of Lagos. Despite the claims, electricity consumers in Umuahia were still counting their losses as power was yet to be restored in the city yesterday evening.
Chibuzo Emuagu, an aluminum fabricator in Umuahia, said he had been using a generator to power his equipment. He lamented the high cost of fueling the generating set he was using to power his machines, and appealed to the government to intervene swiftly.
Attempts to get a reaction from the Enugu Electricity Distribution Company (EEDC), did not yield any result as the Head, Corporate Communications of the DisCo, Emeka Eze, did not pick calls put to his cell phone.
Eze had earlier in a statement informed EEDC customers in the Southeast zone that there was a total collapse of the national grid, which had affected power supply, appealing for their patience while efforts were being made to fix it.
Earlier on Tuesday, indications emerged that Nigeria’s electricity generation infrastructure may have suffered further deterioration resulting in a massive crash to 1,705MW output, about the lowest in recent years. The output was 4,182 MW the previous day.
 While both the regulators and operators declined to speak officially on what happened before yesterday’s grid collapse blamed on fire incident, a source at the Association of Power Generating Companies attributed the sudden system crash to equipment failure, lack of gas and other problems in the sector, noting that the power value chain is the cause for the drastic drop.
The source added that GenCos believe the foreign exchange crisis, shortage of gas as well as TCN incapacity to address challenges in the sector caused the sudden drop in generation, as the system has become more fragile. He further cited the right tariff as one other challenge hampering power generation in the country.
 “The business strives on generating and selling. If we don’t sell we can’t be in business. The value chain still needs to be attended to and urgently I would say else all hopes would remain a mirage. Hopefully, we have a new government and we are still watching to see the direction they are going to get the sector fixed, otherwise, be it 20 or 30 years, we would still be running in circles without gearing headway in the country’s power sector,” the source noted.
According to the Nigeria Electricity System Operator (NESO), the semi-autonomous arm of the TCN, data showed that the drop affected the transmission and distribution of adequate supply of electricity by the TCN and DisCos, to consumers nationwide.
Prior to the total collapse, it indicated that the DisCos embarked on massive load shedding, targeted at allocating the meager supply to different categories of consumers, while more consumers resorted to independent power generation.


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