HEADLINENEWS.NEWS correspondent reports that ABUJA- The Federal government has emphasised that for the power sector to operate at peak performance, an annual investment of $10 billion is imperative, just as it also disclosed that the country would allocate N2.9 trillion to achieve full sector subsidy.
This is as Senators have called on the Minister of Power, Adebayo Adelabu and the Nigerian Electricity Regulatory Commission, NERC, to as a matter of urgency, reverse the recent decision to increase electricity tariff for band A customers in the country.
The investigative hearing by Senator Enyinnaya Abaribe, APGA, Abia South led Senate Committee on Power is also about the N2.9tn required for electricity subsidy payment, other debts owed in the sector, and the state of metering in the country as well as the $1.3 billion owed gas companies even as it asked why Nigerians were suddenly classified under various bands.
The Minister told the Senate Committee that the major challenge in the sector was absence of liquidity, saying that the sector has been operating on a subsidised tariff regime,given the absence of a cost-reflective tariff, just as he stressed the subsidy had not been funded over the years as huge liabilities was been owned the Generating Companies ( GenCos) and the Gas Companies.
Adelabu who noted that the inability of the government to pay the outstanding N2.9 trillion subsidy was due to limited resources, hence the need to evolve measures to sustain the sector, however, pleaded with the Senators to support the process of paying the debt owed operators across the value chain of generation transmission and distribution.
According to him, the increase was based on supply and that any customer that do not receive 20 hours power supply will not be made to pay the new tarrif, adding that the government was committed to ensuring sustainable reform in the sector, even as he told the Senate that eight million meters would be acquired in the next four years.
The Minister who noted that there was the urgent need to clear the outstanding debt owed GenCos and Gas companies, said, “For this sector to be revived, government need to spend nothing less than 10 billion dollars annually in the next 10 years. This is because of the Infrastructure requirement for the stability of the sector, but government can not afford that.
According to him, poor metering remains a big issue too in the industry when he told the lawmakers about how a company, Ziklag Networks Limited allegedly collected N32 billion for a contract to supply meters but has refused to do so in 20 years.
According to Adelabu, to improve power supply, the government was investing in hydroelectric power, even as he said that construction of 700 megawatt power in Zungeru had commenced, while Kashimbila Hydroelectric power plant of 40 mega watt was awaiting evacuation to improve generation.
The Minister also disclosed that there was also an ongoing investment in 26 small hydropower dams to boost electricity production across the country.
