Why Nigeria is not able to generate 6,000MW, by NERC

NERC Chairman, Dr. Sam Amadi

NERC Chairman, Dr. Sam Amad

Nigerian Electricity Regulatory Commission (NERC) has attributed the country’s inability to generate 6,000MW to corruption, incompetence in project management and lack of prudent public sector investment.

The Chairman of NERC, Dr. Sam Amadi, who made this disclosure recently at a forum organized by the National Association of Petroleum Explorationists (NAPE), noted that the major challenges which have hindered Nigeria from generating up to 6,000mw have little or nothing to do with the regulatory activities of NERC.

According to him, at less than 6,000mw the electricity market in Nigeria is unstable and supply will remain poor. He said that the chronic low generation is largely a result of problems associated with the gas supply. “These problems range from incoherence in gas-to-power policy, low commerciality in gas supply to power and very poor gas to power infrastructure. “The lack of gas supply necessary to fire available generating plants is the main reason we don’t have at least 5,500MW of daily generation.

We know from experience that with constant daily generation of 5,000MW, Nigerians will experience a major relief from irregular power until the major improvements are delivered.

The problem of gas supply has manifested in two main forms – vandalism of gas pipelines and poor project management of gas facilities”, he added. Amade stated electricity supply will improve by about 50 per cent if the country is able to tackle the issue of gas supply. “Recently we have seen modest improvement in gas supply.

This has resulted in improvement in power supply. We have moved from around 2,500mw we got during the week of inauguration to about 4,300mw today. “We believe that with more improvement in gas supply arising from containment of vandalization of gas infrastructure on Trans Forcados and ELPS gas pipelines, generation may grow to about 5,500mw in a couple of months.

We have been informed that some of the reasons for increased vandalism in the last months before the elections and immediately after the elections related to rival militancy and nefarious actions of some contractors who are allegedly damaging the pipelines in order to get fresh contracts.

Due to incessant repairs of the pipelines, there is now an issue of technical integrity of these pipelines, further constraining supply of gas to power plants”, he said. He disclosed that the inadequate gas infrastructure has also contributed to the low power generation in the country, saying that the country lack adequate capacity to process gas and facilities to transport gas to power plants.

Amadi stated: “This inadequacy is itself a result of structured disconnection between power generation and gas business. Gas policy and regulatory framework until recently were not consciously focused on power generation.

So, the gas market did not process enough gas for the power sector. Much of the gas produced goes to the export market and other domestic industrial users.

Additionally, there has been manifest project failure with regards to gas transport facilities. Project failure results from both corruption and lack of managerial competence.

Both corruption in award of contract and the lack of integrity in project funding has resulted in delayed completion of the East-West gas pipelines causing low generation from power plants in the western axis”.

He argued that combination of better community response, anticorruption measures and new technology will drastically reduce pipeline vandalism. He noted that changing the incentive for militant groups to attack the pipelines by reforming the contract regime of pipeline management and improving public trust of those communities will provide longer lasting solutions.



8 Comments
  • Ojiyovwi

    You cannot excuse incompetence!!! Poor resource planning ability without checks and balances is the method of the failed projects all over our lives in Nigeria. We are learning how to deliver on projects objectives, so keep the diliverables simple and small. Big infrastructure projects here in the UK always overrun and that is for a country with all the resources to handle such magnitude projects. Our country is still developing these abilities, so we must keep the deliverables as just that – deliverable!!! We can do this by dividing up large projects into small sections and having a supra-execution project to co-ordinate integration of the small project to achieve the principal project objectives. This can then be the template for susequent projects untill a reliable methodology evolves from years of practices. Address all errors promtly and prevent these from escalalting into critical path blocks. This approach may incur higher costs than typical, but you develop the expert methods that can be roughly standardised.

    • Gbénga Ayòdélé Owólabí

      Very interesting to see all these comments from Nigerians that care. First and foremost, I can say categorically that unless Nigeria take charge of all the Hydro stations, generating electricity through Gas is highly expensive world wide, though people believe this could work perfectly in Nigeria because of the availability of Gas in our fields but…….
      Sincerely,I’ve been following up with Mr. Jacob Ajayi write up since all these while including his responses to the REUTER publication in the PUNCH newspaper sometimes mid July and it was highly wonderderful.
      I was prompted after reading his response in punch to search him up, fortunately I got him and requested for his findings on our hydro which he quickly forwarded to me. Alas!!!, this man and his technical partner really went far in inspecting all our hydro power stations in 2010 through Power ministry approval and made vital and useful recommendations accordingly.
      Surprisingly, their findings shocked me as presidency refused to honour the report. What’s the problem with Nigeria?. It is high time we accept Africa Mutual Benefit report and give them benefit of doubt to perform since the expenditure will be sourced from international institutions, this without any burden on Government but has loan. Please let’s shout this out to people that matters until the reports get to them for implementation. The summary of the report can be released on permission from Mr. Jacob Ajayi.
      Send a mail to: ogaaza@yahoo.co.uk

  • emmanuel kalu

    NO NO. you can’t blame all these on vandals yet again. it is time nigeria leaders stop using corruption and vandals as excuse for everything. Why hasn’t NERC mandate the installation of meters across the nation. If you constantly have vandals attacking pipelines, why hasn’t NERC mandated that power plants come up with alternate mode of transporting the gas the need. there are various means of transporting gas, trucking, badges and trains. Why hasn’t NERC mandated that generating plant store enough gas on ground to last at least a month. why does NERC continue to give license for gas powered plants, when they know we have a problem with supply. where are the coal, the renewable, hydro etc. Most americans power plants, generate electricity from multiple sources, gas, coal, wind, solar, nuclear, even trash. we have the capacity to turn things around, but our corruption leaders continue to push this country backward.

    • anthony24g

      Gas transportation via trucks, badges, and trains are poor, costly, dangerous, and volume limiting methods for delivery of gas to gas fired power plants anywhere in the world. They are not even used for delivery of gas to homes for daily use. Hence every country that hopes to be energy efficient using gas resources develops and implements a very efficient gas distribution pipeline-network.
      Nigerians who damage the limited existing gas pipelines are really enemies of progress for themselves and Nigeria and are also putting their lives as well as lives of others in danger and should be treated as dangerous arsonists that should be kept forever under locks.

      • emmanuel kalu

        All those method mentioned are still used in developed countries that have better network of gas pipelines. Farmer in America use propane gas and it is delivered via trucks to their storage tanker. Yes they are not the most efficient means. But when you have a problem like nigeria does. You use every means possible to solve your problem.

  • Jacob Ajayi

    All the epistle that NERC Chairman, Dr. Sam Amadi is publishing about Nigeria’s inability to generate 6,000MW of electric power can be summarized thus: old way of thinking and over-reliance on gas fired electric power!
    Originally, Nigeria started producing electricity with coal from Enugu(Udi hills) and giant diesel generators held sway most especially in the Northern part of Nigeria. According to a long-time NEPA executive, Engineer Shangosina; “we were using giant diesel-powered generators all over the Northern Region in those days… because those generators were located far away from urban centers, a lot of people including you(Ajayi), thought coal was supplying all Nigeria with electric power.”
    Nigeria dabbled into hydro-powered electricity by developing Ikerre Gorge dam which the English colonial masters thought could produce about 3,750MW of power at full capacity, Ikerre Gorge was abandoned and the power house and electrification of the dam has never been completed. Then Nigeria developed Kainji dam which was to supply most of the country’s electric power; Upon the commissioning of Kainji dam, all earlier sources of electric power including coal, which is the second cheapest source of electric power were neglected in the true Nigerian sense of doing things and all the Enugu coal mines were closed and the pits and all were abandoned! Kainji, Jebba and Shiroro the three hydropower plants built to replace fossilized electric power source were never fully completed and demand for electric power suddenly rendered these hydropower plants inadequate. Instead of expanding our hydropower resource; we shifted to gas-fired electric power plants; the Ughelli and Egbin and contracted some unreliable Chinese technologies in Omotoso, Papalanto and Geregu to name a few. We then discovered that Mambilla hydropower projects costing billions of dollars is the way to go while Kainji hydropower station has 4 open pits that could be put to use to at least double the power output of Kainji from 760MW to about 1,500MW. We never touched Ikerre Gorge dam with a potential for 3,750MW of hydropower. And on top of all this, the only thing Dr. Amadi would publish to tell Nigerians is that vandalism of gas pipeline is the reason we could not generate mere 6,000MW of electric power! This is a shame and Dr. Amadi knows this well. If Kainji(1,500), Jebba(1,100) Shiroro(1,100) and Ikerre Gorge(3,750) were fully utilized, isn’t that 7,450MW of hydropower and combining this with Egbin Thermal Station with an installed capacity of 1,320MW does Nigeria not have about 9,000MW of power readily available with less than 15% of this available power generated from gas? If Enugu coal mines were never neglected and the high-BTU content coals from Enugu mines which can fire another 6,000MW of cheap electric power for Nigeria; are we not clocking 15,000MW already! But all that Dr. Amadi and the PHCN Executive Director(Operations) together with our “Director of Power” in Abuja will tell us is that Nigeria could not generate 6,000MW because of gas-line vandalism! All these excuses have got to stop and Nigeria has to wake up to an era of “CAN DO”! There is absolutely no excuse for our inability to generate 15,000MW of power within 2years of my comment. One of our principals told us in 2011 when we showed him our proposal to generate 17,100MW by 2015 that we(Africa Mutual Funds Corporation) should be looking at planning to generate 50,000MW of electric power from all the resources that are available in Nigeria! Let all hands be on deck! and let us show the world that we can do things in Nigeria. Let the era of Excuses and ineptitude be done away with. Nigerian economy will explode with double digit growth with just about 12,000MW of electric power, manufacturing cost will reduce, company profits will soar, unemployment rate will drop to single digits and the Naira will firm up to about N100 to the $1!
    If Dr. Amadi and others are not willing to jumpstart Nigerian economy by generating electric power, We have plenty of people that are Willing Able and Ready to make this happen! May God bless the Federal Republic of Nigeria.

    • Abayomi A

      Thus far, this resonates as one of the very few intelligent and substantive contributions to the scourge of inadequate and epileptic power supply in Nigeria. Amadi has one point, though; corruption is a huge impediment to any marked uptempo in Nigeria’s foreign direct investment (FDI) status in general and the power sector in particular.

      I agree with Buhari that technocrats like us are material to any meaningful prosecution of change in NIgeria across the board. The president can start with the likes of Jacob Ajayi that are definitely not in short supply locally and abroad. Do not make the mistake of going through political channels to seek competent hands; you will be looking in wrong places. Politicans are businessmen and women in disguise. Nationalism means next to nothing to career politicians. They are primarily interested in converting political opportunism to business profitting or profiteering. No radical change can start without first ending the recycling of old, tired hands that have done Nigeria no good over the years.

  • Perrymarvis2014

    Mr Jacob Ajayi, God will bless you for your incisive information. Dr Sam Amadi and his group are full of excuses. He doesn’t give any excuses when it comes to punishing consumers with high Tariffs and estimated bills. Sam Amadi is still carrying on with the PDP mentality of doing things. It is high time he was dismissed so that another fresh and competent person will take over. Excuses will never take us any where.

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