Power: FG Admits Planning Mistakes

President Goodluck Jonathan

Mistakes were made by the Federal Government at the planning stage of the building Independent Power Plants (IPPs) in the country, President Goodluck Jonathan said Monday.

These mistakes, he said, were because the government was in a hurry to achieve results and the feasibility studies were overlooked.

Although he did not elaborate on these mistakes, but when most of the contracts were awarded in 2006, there were no plans on how they would get gas.

This has led to the non-commissioning of many of the plants but efforts are currently on to lay gas pipelines to the sites so that they can begin to generate electricity.

Jonathan, who was speaking at a workshop on “Unbundling Barriers to Achieving Power Sector Vision” at the Banquet Hall of the Presidential Villa, Abuja, also warned that manipulation in the privatisation and implementation of the power roadmap would no longer be tolerated.

He said officials handling the exercise would face severe punishment should they bow to any pressure to do otherwise as Nigeria must get it right this time.

He further said in the privatisation process of the sector, only competent and performing companies with proven ability to deliver would be given opportunity to participate while those short-listed must have followed internationally laid down procedures for the best results to be achieved.

The president also called for more advocacy to keep Nigerians abreast with the events in the policies and programmes of government, especially before the take-off of planned increase in tariff next month.

He said there was need to always keep the people informed to remove friction.

Jonathan, who spent the whole day with Vice-President Namadi Sambo at the workshop, said the real decisions would be articulated today so that major decisions and adjustments that will yield fast result in the power sector could be reached.

He warned officials to resist any manipulative politician, even if the person claimed to have come from him, saying that anyone indicted for not executing the programme transparently would be made to face the music alone.

He said: “The Bureau for Public Enterprises must follow up on the privatisation issue strictly. We do not want to hear any story again; they must follow issues to the letter and strictly with the dates.  That we must do with date on the power reform roadmap.  We agreed that it is only through privatisation that we would get to where we want to go.

“Let me use this opportunity to warn that I do not want to hear that they have been influenced by any politician. At least I am the number one politician. Whether the person is my mother or my uncle, I do not want to hear that somebody is from the president or vice-president or that. If you make mistakes, you are on your own and we will deal with you decisively.  We must give to the best.

“The BPE will never make mistakes to give these to companies that cannot perform. It must follow international best practice. So I want to assure all Nigerians and all the companies that have indicated their interest that there will be no political manipulations and that everything will be followed professionally and only the best can get it. We are not going to play politics with the power privatisation programmes.”

On the planned date of tariff increase, he said: “I do not think we have had a robust advocacy and this happened to me during the deregulation. At a point, I wanted to send a team to the states to work with the governors and Benue State Governor (Gabriel Suswam) said no that if we do that, there could be crises, that the governors should take charge. At the end of the day, by the day we announced the deregulation, almost everything was on my head.

“Everything was on Jonathan to the extent that even the House of Reps met on a Sunday to discuss it and it became an issue. At a point, some of the governors who participated in pressurising me started shifting back. All what I am saying is that we do not have a robust advocacy. The Civil Society may come and tell you that they never heard you. We want enough communication so that we do not get to that June 1st and Nigerians have not been sufficiently informed.”

Earlier, participants at the forum agreed that the problem that afflicted the power sector stemmed from lack of feasibility studies or citing of the stations through political considerations without looking out availability of gas to fire the stations which has led to plants being ready without gas to power them.

However, speaking at a joint address of State House correspondents, Ministers of Power, Professor Barth Nnaji, and his Petroleum Resources counterpart, Mrs. Diezani Alison-Madueke, said that they met the situation on ground and had to synergise and ensure that never again would such mistakes arise.
Nnaji, who said current power generation hovered between 3,500 to 3700 megawatts, blamed loss of generation at hydro stations to low water levels, but promised that from next month, the volume of generation would steadily increase “never to drop as it is now”.

The ministers said for every power plant built now, there was plan to supply gas to power them while the transmission and distribution infrastructure were being expanded to ensure that the wheeling of generated power to homes was no longer a problem, adding that from where the country was now in power supply, it will only improve and never to fall back.

On the gas supply emergency declared, Diezeani said the scheme was looking beyond the immediate needs but includes supply plans till 2020.

She said that by the first quarter of 2013 Nigeria would be able to approximately put at the disposal of thermal stations in the country 500 million square cubic meters of gas daily.

“But beyond that we also looked at the schedule to ensure that we begin to ramp up so that we can ensure proper alignment between the gas supply and the NIPPs which will be coming on board. Because as early as the end of this month, NIPPs will begin to come on stream so we are planning for the immediate 12 months calling it an emergency period to put the required impetus on the necessity gas supplies to meet the demands on power sector.

“Beyond that, we are looking to 2014 and then we will ramp up again between 2014 and 2020. So we are going into very aggressive planning stages from here on. But the beauty of it is that we are now aligning properly with the power sector. Before this time, there was no alignment which means that while the NIPPs were being built nobody considered where the gas that would fuel the power for the NIPPs was coming from. They did not align the NIPPs that were being built with the required gas supply. Now we are working together, power and petroleum resources ministries to ensure henceforth that will never happen again,” she said.

Nnaji explained that “we have a number of power plants that are going to come on stream this year and next year and the issue is quite unlike in the past, when these power plants come due for production that the gas will be valuable because a lot of the power plants that we are building over the next many years would be gas-fired. So we must prepare for the gas and of course the infrastructure must be well planned so that we don't have stranded capacity due to transmission.

“What we are doing now is fleshing out all those issues that are impeding progress in the power sector and aligning them and the stakeholders are here so that these issues would be addressed. Alignment didn't exist before but with what we are doing now you are going to see real deliveries.”

On sustainability, he said: “Let me say from this month a lot of power will come and will continue to come through the end of the year. So what Nigerians are expecting will begin to be seen for sure. The misalignment yes, at the beginning there was no proper plan to deliver gas to support power, that is really the problem and is not just thinking it, it has to be planning it, engaging the people that are to be part of it and committing resources to ensure we realise it.”

President Goodluck Jonathan

Mistakes were made by the Federal Government at the planning stage of the building Independent Power Plants (IPPs) in the country, President Goodluck Jonathan said Monday.

These mistakes, he said, were because the government was in a hurry to achieve results and the feasibility studies were overlooked.

Although he did not elaborate on these mistakes, but when most of the contracts were awarded in 2006, there were no plans on how they would get gas.

This has led to the non-commissioning of many of the plants but efforts are currently on to lay gas pipelines to the sites so that they can begin to generate electricity.

Jonathan, who was speaking at a workshop on “Unbundling Barriers to Achieving Power Sector Vision” at the Banquet Hall of the Presidential Villa, Abuja, also warned that manipulation in the privatisation and implementation of the power roadmap would no longer be tolerated.

He said officials handling the exercise would face severe punishment should they bow to any pressure to do otherwise as Nigeria must get it right this time.

He further said in the privatisation process of the sector, only competent and performing companies with proven ability to deliver would be given opportunity to participate while those short-listed must have followed internationally laid down procedures for the best results to be achieved.

The president also called for more advocacy to keep Nigerians abreast with the events in the policies and programmes of government, especially before the take-off of planned increase in tariff next month.

He said there was need to always keep the people informed to remove friction.

Jonathan, who spent the whole day with Vice-President Namadi Sambo at the workshop, said the real decisions would be articulated today so that major decisions and adjustments that will yield fast result in the power sector could be reached.

He warned officials to resist any manipulative politician, even if the person claimed to have come from him, saying that anyone indicted for not executing the programme transparently would be made to face the music alone.

He said: “The Bureau for Public Enterprises must follow up on the privatisation issue strictly. We do not want to hear any story again; they must follow issues to the letter and strictly with the dates.  That we must do with date on the power reform roadmap.  We agreed that it is only through privatisation that we would get to where we want to go.

“Let me use this opportunity to warn that I do not want to hear that they have been influenced by any politician. At least I am the number one politician. Whether the person is my mother or my uncle, I do not want to hear that somebody is from the president or vice-president or that. If you make mistakes, you are on your own and we will deal with you decisively.  We must give to the best.

“The BPE will never make mistakes to give these to companies that cannot perform. It must follow international best practice. So I want to assure all Nigerians and all the companies that have indicated their interest that there will be no political manipulations and that everything will be followed professionally and only the best can get it. We are not going to play politics with the power privatisation programmes.”

On the planned date of tariff increase, he said: “I do not think we have had a robust advocacy and this happened to me during the deregulation. At a point, I wanted to send a team to the states to work with the governors and Benue State Governor (Gabriel Suswam) said no that if we do that, there could be crises, that the governors should take charge. At the end of the day, by the day we announced the deregulation, almost everything was on my head.

“Everything was on Jonathan to the extent that even the House of Reps met on a Sunday to discuss it and it became an issue. At a point, some of the governors who participated in pressurising me started shifting back. All what I am saying is that we do not have a robust advocacy. The Civil Society may come and tell you that they never heard you. We want enough communication so that we do not get to that June 1st and Nigerians have not been sufficiently informed.”

Earlier, participants at the forum agreed that the problem that afflicted the power sector stemmed from lack of feasibility studies or citing of the stations through political considerations without looking out availability of gas to fire the stations which has led to plants being ready without gas to power them.

However, speaking at a joint address of State House correspondents, Ministers of Power, Professor Barth Nnaji, and his Petroleum Resources counterpart, Mrs. Diezani Alison-Madueke, said that they met the situation on ground and had to synergise and ensure that never again would such mistakes arise.
Nnaji, who said current power generation hovered between 3,500 to 3700 megawatts, blamed loss of generation at hydro stations to low water levels, but promised that from next month, the volume of generation would steadily increase “never to drop as it is now”.

The ministers said for every power plant built now, there was plan to supply gas to power them while the transmission and distribution infrastructure were being expanded to ensure that the wheeling of generated power to homes was no longer a problem, adding that from where the country was now in power supply, it will only improve and never to fall back.

On the gas supply emergency declared, Diezeani said the scheme was looking beyond the immediate needs but includes supply plans till 2020.

She said that by the first quarter of 2013 Nigeria would be able to approximately put at the disposal of thermal stations in the country 500 million square cubic meters of gas daily.

“But beyond that we also looked at the schedule to ensure that we begin to ramp up so that we can ensure proper alignment between the gas supply and the NIPPs which will be coming on board. Because as early as the end of this month, NIPPs will begin to come on stream so we are planning for the immediate 12 months calling it an emergency period to put the required impetus on the necessity gas supplies to meet the demands on power sector.

“Beyond that, we are looking to 2014 and then we will ramp up again between 2014 and 2020. So we are going into very aggressive planning stages from here on. But the beauty of it is that we are now aligning properly with the power sector. Before this time, there was no alignment which means that while the NIPPs were being built nobody considered where the gas that would fuel the power for the NIPPs was coming from. They did not align the NIPPs that were being built with the required gas supply. Now we are working together, power and petroleum resources ministries to ensure henceforth that will never happen again,” she said.

Nnaji explained that “we have a number of power plants that are going to come on stream this year and next year and the issue is quite unlike in the past, when these power plants come due for production that the gas will be valuable because a lot of the power plants that we are building over the next many years would be gas-fired. So we must prepare for the gas and of course the infrastructure must be well planned so that we don't have stranded capacity due to transmission.

“What we are doing now is fleshing out all those issues that are impeding progress in the power sector and aligning them and the stakeholders are here so that these issues would be addressed. Alignment didn't exist before but with what we are doing now you are going to see real deliveries.”

On sustainability, he said: “Let me say from this month a lot of power will come and will continue to come through the end of the year. So what Nigerians are expecting will begin to be seen for sure. The misalignment yes, at the beginning there was no proper plan to deliver gas to support power, that is really the problem and is not just thinking it, it has to be planning it, engaging the people that are to be part of it and committing resources to ensure we realise it.”