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The government’s threat to DisCos 

By Editorial Board
18 March 2020   |   3:55 am
The federal government’s recent threat to stop subsidising the power sector is a careless blighter we do not need at a time that the people need some glimmer of hope.

The federal government’s recent threat to stop subsidising the power sector is a careless blighter we do not need at a time that the people need some glimmer of hope. After the garrulous minister of power’s sound and fury, which signified nothing, government strangely called on electricity distributing companies (DisCos) to improve their financial and technical capacities to make power available to the nation. The government also threatened to “intervene more directly to find solution to the darkness in the country” if the DisCos failed to improve. This is one empty vaunting too many since 2015.

Although the Minister, Malam Saleh Mamman did not indicate the type or nature of the “direct intervention” the government may pursue, it is worth remembering that the DisCos came to life in Nigeria following government’s failure to make power available to Nigerians. Indeed, the distribution companies are a direct intervention government believed would resolve the numerous problems that incapacitated their government-owned fore-bearers, the National Electric Power Authority (NEPA) and Power Holding Company of Nigeria (PHCN), from delivering electricity to the people. In the wisdom of the government, the Power Generating Companies (GenCos) and Power Distribution Companies (DisCos) were born as outcome of the ensuing reforms of the power sector. They were promoted as private-owned entities possessing the magic wand that would squarely deal with the ugly and embarrassing electric power situation that held back national growth and development. How long will it take to admit that the unbundling and sale of controlling shares in the companies has been a failure?

Years after the coming upstream by the DisCos, Nigerians are still agonising the embarrassing state of electricity power situation in the country. Aside from its erratic and poor quality in a few areas of the country, electric power has ceased to be available in all other areas. Indeed, given an opportunity to choose between what was in the days of NEPA/PHCN and since the debut of the DisCos, there is hardly any doubt that most if not all Nigerians will vote to go back to the days of NEPA/PHCN, an indication that electricity supply has become worse. And this ought to be a serious source of concern to the government, if there is sincerity in the governance of this country.

It is rather surprising to learn from the power minister that the federal government has been subsidising electric power distribution, even after private entities took over the business years ago. The consequence of such subsidies is that Nigerians are losing from all angles. The money that should have been used to cater for other pressing needs of the country is being used to subsidise the operations of private-owned enterprises. And who says this may not be part of the reasons the DisCos are not ensuring that power is made available to the people. Since they know that government will continue to avail them subsidies for as long as the situation remains bad or even worse, why will they make good the electricity supply chain? There is no incentive for that since they are contented with receiving and pocketing the subsidies.

Obviously, the distribution companies have not deployed the subsidies towards improving the status quo because it is in their interest that such improvement is stalled, by all means.

If indeed, the government has been subsidising power distribution, it raises a number of questions and the critical ones are: why such subsidies? Who benefits from the subsidies, if the people are not getting electricity supply? Why are electricity bills still very high, even when power is not supplied? It is perhaps because the DisCos have been feathering their nests with the subsidies that they are now angling for a higher electricity tariff even when consumers are not receiving any benefits. The DisCos are counting on government to continue with the subsidies especially as no right-thinking person will continue to pay for a product or service without receiving value.

The federal government must know that Nigerians are gravely suffering from lack of and in a few cases, insufficient or irregular electricity supply. Were it not for the presence of electric power generating sets in the markets, life in this nation would have deteriorated beyond comprehension. Yet, while nothing concrete and visible is being done to change this unfortunate burden, Senator Bima Enagi, representing Niger South District, has proposed a bill to ban the importation and use of all kinds of power generating sets. The day that toxic bill becomes an Act, in the present condition, the nation’s nunc dimittis would have been sung.

As the power minister noted, the power generation capacity of the country is over 13,000 megawatts while transmission could reach 7,000 megawatts, but these never-do-well DisCos only distribute 3,000 – 4000 megawatts, a far cry from the needs of the country. Besides, they only pay for about 1,000MW while the government pays for the balance of 3,000 MW with taxpayers money – for private businesses. This is unacceptable.

That the minister threw up the name of Siemens, a popular German company in electricity power business, as part of the solutions being considered, is worth noting. However, whatever ‘talks’ that may be going in this regard should be fast-tracked and concluded. Siemens has enviable track records of many years in the global power sector. But the same Siemens has been mentioned in some messy transactions in the same sector in Nigeria. There may be questions tomorrow if Siemens name is dragged into disrepute the Nigerian way. Let Siemens prove cynics wrong, in this regard.  The hope is that the company should find ways to ensure it is not dragged into this business just to give cold comfort to those who have chosen to keep this blessed nation in perpetual darkness. It should therefore, insist on what must work within the shortest possible time.

It is hereby advised that, rather than threats that will never yield the desired positive changes that Nigerians look forward to, the government should give actionable directives and deadlines to the DisCos to perform or be relieved of this essential national service they have failed to deliver.

Nigerians need and deserve to have sufficient uninterrupted electricity supply. The government should stop empty boasts about what other less endowed countries have long put behind them. It is high time all manner of excuses were buried and the people of this nation empowered with electricity for the growth and development of the country. We will be migrating from darkness to darkness in all sectors if we don’t tackle the electricity challenges in the country.