Nigeria is considering offers of more than $20 billion for the assets
of its national electricity transmission company as it struggles to
provide adequate power to
Africa’s largest economy, Power Minister Chinedu Nebo said.
The
sale of state-owned Transmission Co. of Nigeria may start “in a few
years,” Nebo said in a Sept. 12 interview with Bloomberg Television
Africa in Abuja, the capital. The government will also focus on
developing renewable energy projects to diversify its supply of
electricity, he said.
“The interest now for transmission is over $20 billion,” he said on Sept. 12. “People are coming from everywhere.”
Transmission
is the only segment of the power industry that the government still
controls as it seeks to curb regular blackouts in Africa’s largest oil
producer. The country generates about a 10th of the power that South
Africa does even though its population of about 170 million is more than
three times larger.
The government of President Goodluck
Jonathan is spending $3.5 billion to boost transmission capacity by 50
percent. Nigeria sold 15 state-owned generation and distribution
companies to raise funds.
The current transmission capacity of
Abuja-based TCN is 5,500 megawatts compared with an installed generation
capacity of 8,000 megawatts, Nebo said. This means that if generation
companies were operating at full capacity, the grid would be unable to
transmit all of the power to homes. The government wants transmission
capacity to exceed 6,000 megawatts by 2016, Nebo said.
Neglected Coal
Power
generation is significantly lower than capacity, partially due to
problems of transporting gas to power plants. Many companies and
individuals are compelled to use diesel-powered generators to ensure
adequate electricity.
“Gas supply has been a limiting factor,”
said Nebo, who is working with Minister of Petroleum Resources Diezani
Alison-Madueke to make enough gas available to generation companies to
match the transmission capacity by the end of next year.
“Nigeria is moving in the direction of trying to have a robust energy mix,” he said.
Coal
is another resource that could generate 3,000 to 5,000 megawatts of
power “in the next several years” after government reclaims unused coal
blocks, the minister said.
“We are working on making sure those
coal blocks are taken away from those who have refused to develop them
over the decades and are given to those who can actually develop them,”
he said.
Canadian Managers
Officials are deciding
which model to adopt for the company’s sale. Manitoba Hydro-Electric
Board of Canada’s three-year management contract ends next year. The
process could take the form of a public-private partnership, a
concession or a build-operate-transfer, Nebo said.
While
divesting from most other parts of the power industry, the government is
planning to invest more in renewable energy such as solar and hydro
power, Nebo said.
“The government is very intent on making sure
that the renewable energies kick off because we cannot continue to
depend on only one or two means to continue giving electricity to our
people,” the minister said, citing the planned 700-megawatt and
3,050-megawatt hydropower plants in Zungeru and Mambila. Both plants are
in central Nigeria