‘Nigeria to leverage 209trcf gas reserves for energy transition’

The Federal Government has announced plans to deploy seven million smart electricity meters nationwide through the Presidential Metering Initiative (PMI), as part of efforts to eliminate estimated billing and curb revenue leakages in Nigeria’s power sector.

This was as the Presidency said the country’s 209 trillion cubic feet of proven gas reserves have been positioned as the nation’s key asset for energy transition and economy diversification.

Special Adviser to the President on Energy, Mrs Olu Verheijen, disclosed this, yesterday, in Abuja as part of events to commemorate the second anniversary of President Bola Tinubu’s administration.

She described the meter roll-out as a critical component of the administration’s plan to strengthen the commercial viability of the electricity value chain, particularly the gas-to-power segment.

“There are a number of actions or interventions we are taking to ensure that we improve the commercial viability of the gas-to-power value chain,” she said.

According to her, the government is developing policies and regulatory frameworks that will facilitate a cost-reflective electricity market and promote operational efficiency across the sector.

“We are developing the policy and the frameworks that enable us to transition to a system that allows us to charge the cost of delivering electricity, and, more importantly, to drive efficiencies in arriving at that cost,” she said.

Verheijen also noted that the administration’s broader power sector reforms include addressing longstanding debts owed to electricity generation companies (GenCos) and gas suppliers, which hindered sector liquidity.

“We plan to clear the legacy debt with a mix of cash and promissory notes to ensure that the generation companies and the gas suppliers are also paid,” she said, attributing the accumulation of debt to the government’s previous inability to sustain electricity subsidies, as well as the poor revenue performance of electricity distribution companies (DisCos).

“In addition to this, we are making sure that we improve revenue assurance by ensuring that most customers on the grid are metered. With this, we can end estimated billing and ensure that we reduce collection losses so that customers who get electricity are paying,” she said.

Nigeria Electricity Regulatory Commission (NERC) imposed fines totalling N628 million on eight DisCos, including Abuja Electricity Distribution Company (AEDC) and Ikeja Electric (IE), for violating the capping regulations on estimated billing. These penalties were calculated based on the volume of excessive billing and the duration of the infractions.

NERC emphasised that the enforcement was part of its broader regulatory efforts to curb estimated billing abuse and accelerate the deployment of prepaid meters under the National Mass Metering Programme (NMMP) and other initiatives.

Verheijen, in a chat in Abuja, yesterday, said the government was leveraging the nation’s gas resources in diversifying the economy and achieving energy transition and creating jobs.

She said the administration built on the Petroleum Industry Act (PIA) through Presidential Directives 40 to 42, improved fiscal terms and regulatory clarity to restore investors’ confidence.

“This is evident by projects like the Betafield Final Investment Decision, which will supply 350 million scuffs per day of gas and many more projects like this to come,” she said.

The Betafield project, specifically, is expected to produce 350 million standard cubic feet of gas per day. The project, along with others like the Ubeta, aims to enhance Nigeria’s domestic gas supply and its presence in the global energy market.

Verheijen said the administration’s reforms, including the presidential CNG Initiative and LPG incentives were enabling the displacement of diesel, and firewood, and improving health while creating jobs.

“Our decade of gas is accelerating progress with 12 million homes now having LPG access, while infrastructure projects like OB3, AKK Pipeline, and the looping of ALPS are unlocking gas for power and industry. This aligns fully with our energy transition plan,” she said.