Owan laments non-utilisation of $5b power plants

powerDespite the huge investments put into the National Integrated Power Project (NIPP) by the three tiers of government, the power plants so far built under the scheme are idle because of poor gas supply.

This was the assertion of former Chairman of the Nigerian Electricity Regulatory Commission (NERC), Ransome Owan.

Owan spoke yesterday at the Powering Africa Nigeria Summit held in Abuja, where he lamented the lack of concrete gas supply agreements for the power stations.

His words: “Even with over $5billion invested in the NIPPs, they are down as gas is not there to power them. The projects cannot come to a financial close because there is not enough gas for the plants.

“The Nigerian Bulk Electricity Trading Plc (NBET) cannot sign their Power Purchase Agreements (PPAs) unless they answer these two things: do you have gas and can you evacuate power? And the seller, which is the government, cannot answer the questions.”

He charged the federal government to take the risks for supplying gas to power companies. He said since government was a major play with International Oil Companies (IOCs) and owns the Nigerian Gas Pipeline and other infrastructure, it should live up to its responsibility in gas supply to the power sector.

His words: “To have asustainable gas sector, the risk should not be with the IOCs, the gas transporters or the power companies. It is the federal government of Nigeria because it has the army, the joint taskforce to protect the infrastructure.”

The former NERC chief made a case for a single gas regulator. He went on: “To gasify our economy, we would need to have a sector regulator to set a foundation, the rules and regulation for the market. This was done in the power sector.

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  • emmanuel kalu

    The gas supply problem is due to lack of investment by the govt and private investors. we can’t continue to regulate price of items and expect major investment. gas price needs to be allow to be priced via market forces. This would give investor the profit margin to want to invest.

    • Busybee75

      Same for Petrol. Government should remove subsidy and allow market forces to play. Government should participate only as the unseen hand,