FG begins review of power sector licences amid poor supply

The Federal Government is reviewing the operational licences of electricity generation and distribution companies following poor service delivery in the sector, Minister of Power, Abubakar Aliyu.

The minister gave the indication in a statement obtained on Thursday, which was issued in Abuja to mark his 50 days in the office, noting that the FG was aware of the challenges facing the sector and was working to tackle them.

Specifically, the minister said, “We shall be taking a careful and detailed look at issues of policy, capacity and the technical requirement, amongst other things.

“One very critical concern that we must address in this performance monitoring process is to find out if the terms for granting of licenses were onerous.”

Aliyu also said the FG was “working tirelessly as we explore opportunities that will, in the short term, deliver the much-desired quick wins whilst still focusing on the long-term objectives of increasing the available power, improving the quality of services, attracting the much-needed investment, promoting efficiency, competition and growth and lastly ensuring transparency and accountability in the value chain of the power sector.

“The ministry is intensifying performance monitoring of the licensees and the licensing regime, especially their revised Performance Improvement Plans (PIP) to have a better understanding of why some critical stakeholders are performing below expectation.”

The minister said, “Specific areas of conflict and tensions within the power industry value chain are being harmonized for greater synergy which will bring about a wholesome alignment of responsibilities within the governance system of the power sector. It is this new mindset of cooperation for optimal performance that we are bringing on board”.

According to him, the ministry will be focusing on improving liquidity in the sector; improving services in terms of hours of supply; billing transparency and accuracy, and wider access to electricity; bringing consumer, operator and investor confidence back to the sector to attract foreign and local investment into the sector, create jobs, and promote competition and bring in more participants in the Nigerian Electricity Market.

The power sector was partially privatised in November 2013 with the government handing over the ownership of the DisCos and a large number of GenCos to the private sector. But experts note that the power supply remains poor with the government having to bail out the sector with almost N2 trillion due to poor financial state.