My grand road, electricity vision, by Fashola



WITH fresh ideas, the Minister of Power, Works and Housing, Babatunde Raji Fashola, is set to revolutionize the country’s infrastructure.

The minister, who spoke yesterday in Abuja while unveiling his agenda for the three sectors under his purview, noted that a large percentage of the difference in the proposed 2016 budget would go to capital projects.

On the electricity sector, Fashola called for patience from Nigerians, regretting the reforms proposed in the Nigeria Electricity Power Sector Reform (EPSR) Act did not take off till November 2013, eight years after the enabling law came into being.

Highlighting the problems in the sector, Fashola said: “There are a number of issues that beset our gas sector such as the environmental issue and the availability of gas infrastructure such as pipelines and the matter of pricing which are all the responsibility of other ministries.

“Subject to budgetary approvals and financing, the Ministry of Petroleum indicates its ability to build certain critical pipelines to transport gas to the power plants that will add another 2,000 mw to our stock of power within 12-15 months.

“Of course the appropriate pricing of gas and its impact on tariff is another matter entirely. If the local market was offering $1.30 per unit of gas, which has been reviewed recently to $3:30, and the international market is offering about $4:00 and above, your guess is as good as mine where supply will be available and where it will be short.

“For emphasis and clarity, let me state that the previous administration had actually approved the tariff in January 2015, but did not fully implement it.”

He also announced that the Nigerian Electricity Regulatory Commission (NERC) and the electricity distribution companies had been mandated to meet and come up with what he described as ‘fair market tariff’.

In the meantime, he appealed to Nigerians over the upcoming electricity tariff increase, stressing that a good tariff system would guarantee good electricity supply.

The former governor of Lagos State, however, insisted that the Discos must commit to certain conditions in the area of providing meters, transformers, expansion of network, among others, in line with the proposed new tariff order.

He was also emphatic that priority would henceforth be given to local meter and transformer manufacturers in procuring the items for the sector.

On whether a cartel of generator importers is hindering the growth of the sector, he said: “There is no evidence that generator dealers are a cartel in the power sector. They have been filling a gap and I have no doubts that they have the capacity to adapt.”

He stressed the key targets in the electricity sector: “Apart from these, there is a 10MW wind energy project in Katsina nearing completion, a 215MW plant in Kaduna and the 3,050 MW plant in Manbilla, Taraba State all of which need to be completed.

“Our first priority is to get contractors to finish ongoing transmission contracts to enable us to transport the electricity being generated to the Discos to distribute.

“Our second priority is to ask the governors to help us identify and enumerate their most populous industrial and commercial clusters where manufacturing, fabrication, welding and related productive work is going on, especially by small businesses and to see how we can use the existing legal framework to attract embedded power supply to these people who must be ready to pay for the power.”

Speaking further on efforts to boost transmission, he added: “We have identified a total of 142 projects of which 45 are at 50% level of completion and about 22 can be completed within a year.”

He noted that about N40 billion would be needed to complete over 22 major transmission companies across the country, admitting however, that the existing budgets for TCN could hardly do much.

Fashola also said efforts were ongoing to amicably resolve the lingering impasse between Geometric Power and the new owners of the Enugu Electricity Distribution Companies over the 144 Aba Independent Power Plant project as the matter had been brought to the attention of President Muhammadu Buhari.

In the Works sector, Fashola said work on the Second Niger Bridge had resumed in earnest while stressing that immediate attention would be on about 200 road contracts that were abandoned because of funds constraints.

His words: “Records available from previous budgets show that the last time Nigeria budgeted over N200 billion in a year for roads was in 2002.
It seems that as our income from oil increased, our spending on roads decreased.

“Our ability to achieve connectivity of roads depends on capital spending in 2016 to pay contractors and get them back to work.”

He went on: “Our short-term strategy will be to start with roads that have made some progress and can be quickly completed to facilitate connectivity, prioritising the roads that connect states and those that bear the heaviest traffic.

“As at May 2015, many contractors have stopped work because of payment, and many fathers and wives employed by them have been laid off as a result.”

On workers laid off by construction companies, he stressed: “Some of the numbers from only four companies that were sampled, suggest that at least 5,150 workers have been laid off as at March 11, 2015; and there are at least 200 contracts pending, on the basis of one company per contract.

“If each contractor has only 100 employees at each of the 200 contract sites, it means at least that 20,000 people who lost their jobs can return to work if the right budget is put in place and funded for contractors to get paid.

“The possibility to return those who have just lost their jobs back to work is the kind of change that we expect to see by this short-term strategy.”

He added: “In order to make the roads safer, we intend to re-claim the full width and setback of all federal roads, representing 16% and about 36,000km of Nigeria’s road network by asking all those who are infringing on our highways, whether by parking, trading, or erection of any inappropriate structures to immediately remove, relocate or dismantle such things voluntarily. This will be the biggest contribution that citizens can offer our country as proof that we all want things to change for the better.

“For clarity, it is important to say that although the state governments own 18% of the total road network of about 200,000km, while the local governments own the balance of 66%, the 16% owned by the Federal Government carries an estimated 70% of the total traffic because of their length, width and inter-state connectivity.”

On government’s plans for the housing sector, he drew attention to its resolve to adopt the Lagos Home Ownership Mortgage Scheme (HOMS) model.

Fashola said: “If we complete our ongoing projects, and we get land from the governors in all states and the Federal Capital Territory (FCT) to start what we know, using the LagosHoms model, we should start 40 blocks of housing in each state and FCT.

“We expect state governors to play a critical role here, by providing land of between 5-10 hectares for a start, with title documents, and access roads or in lieu of access roads, a commitment that they will build the access roads by the time the houses are completed.

“We see this leading to potential delivery of 12 flats per block and 480 flats per state, and 17,760 flats nationwide, for a start.”

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  • Offor

    What a beautiful and wonderful start. Thank you, Fashola.

  • Emeka

    Let’s get cracking, time is of the essence. We have a lot of lost ground to cover and we have only three years to do it

  • Adeyemi

    LagosHoms is only meant for the rich, a block of flat at Igbogbo, Ikorodu sold for N9,000,000. with a deposit of N3,000,000. how many civil servant could afford that? its a fraud, Fashola is only fronting for the rich. A complete and standard 3 bedroom flat will cost same N3,000,000. at Ikorodu.

    • GUEST

      Oga, 9 million is not for the rich o. Maybe middle class..yes but not for the rich! The rich do 100M for empty plot of land and upwards. Let us appreciate the fact that we are starting from somewhere…he can then work on the price and come downwards with options that appeal more to the lower class. I have a lot of colleagues who benefited from the Lagos HOMS scheme and I would not tag them as ‘rich’.

      • Ewu Nama

        Middle class where minimum wage is 18,000 are those who can afford to buy 3 million Naira flat. N10 million means you are rich by national standard.

    • Ladi

      Surely you must see the folly in your estimation. A flat for 9 million is actually considered average in todays’s housing market. Your estimation seems to be based on an individual building by themselves without involving the due process and professional architects, builders, plumbers, electricians and so on.

    • emmanuel kalu

      The government should not be in the business of building house or flats. They need to be in the business of regulations, providing incentive and enabling policies, and they need to be the business of building and guaranteeing mortgage scheme. once the capital is flowing between home buyers, developer and the financial houses. homes would begin to fly off the shelves and be built.

  • Pastor Chris Allu

    I will be surprised if Fashola can provide Nigerians with affordable houses.He is too elitist.He never built a single house for the poor througout his two terms as Lagos State Governor’To vindicate my stand, he is advocating increase in NEPA tarrif and the return of toll gates.An elitist Governor, an elitist Minister.Potable water to rural dwellers remains the credible performance index for a credible government.Federal and state governments have failed us.

  • Haulageman

    Absolutely brilliant! See how he meticulously broke down his vision and he intends to go about it to Nigerians. I am in total support of your mission so far. Carry go and well done. Together we can build this nation back to it’s glory days, it’s a collective efforts of both the leaders and the followers. I love my country.

  • PolyGon2013

    Sai Fashola. There is a difference between leadership and paying lip service. Leadership is finally at the helm of power in Power generation, housing, and you name it!

  • emmanuel kalu

    This is a good laid out plan, that does the most important things. it first identify the problem, and then provides short term relief, while going after the long term goal. The Nigeria government needs to get away from the regulations of prices. we don’t regulate price for the most important thing which is food. we need to stop the price regulation of gas and fuel. we also need to have dedicated funding for things like road, pipelines expansion and transmission expansions. All this things can’t all be funded from just the sale of oil.

  • Kayode Ojuolkun

    The confessed and messy situations Fashola inherited as a Minister with three portfolios have been compounded by the decrees of past military juntos to quicken acceptance rather than thoughtful decisions for the long-term. Across ministries, there are cases of overlapping duties that are hindrance to moving forward with modernization of infra-structures. Though they are under capacity to begin with, but decaying at exponential rates. Thus, it seems the three portfolios need to be untangled to lay good foundation for the respective future of each. What are achievable in this political window are adequate maintenance of existing infra-structures and up grading where possible without undue burden, continuity of existing plans to meet future needs, and generation of funds within each portfolio to meet some of its non-capital expenses regardless of budgetary allocations now or in future. Precisely, housekeeping that should have been ongoing by the past administrations timely. Capital investments in infra-structures take time to acquire land in democratic environment, ensuing lawsuits, and the invited slow-and-go traffic due to weather and under capacity, and the unforeseen last-minute changes to accommodate the challenges of terrains because no-one form fits all.

  • honesty NO1

    Minster Fashola please make sure every house has a meter. You can not only be targeting businesses alone If you provide meters in every homes and distribution is taken care off and you work out a reasonable tariff if anybody is not having electricity in their business or homes that blame is not going to be yours .As at now don’t count anybody out. Regarding your 40 blocks of low cost houses, i am thinking the government should secure the lands from the state government and invite the private sectors to handle that .The Fed can monitor for specification ,quality and price.