As the nation sits transfixed listening to the probe by the House of Representatives into the management and application of funds in the power sector between 1999 and 2007, the presidential committee for the accelerated expansion of the country’s power infrastructure, has submitted its interim report to President Umaru Musa Yar’Adua.
The committee was set up last month by the president to deliver 6,000MW of electricity by August next year.
The report which was submitted last week Monday by the 11-member committee is, however, already dogged by controversy with a few members of the committee expressing reservations over the recommendations contained in the report.
Some of the recommendations contained in the report include the establishment of a Special Purpose Vehicle (SPV) that will superintend the 18 companies created from the unbundling of the Power Holding Company of Nigeria (PHCN) in 2006; a transition period of two years during which alternative sources of funding amounting to $2 billion to $3 billion from private sector sources will be raised to complete the National Integrated Power Projects (NIPP); and assurances from the Federal Government that once the transition period is over, there will be outright privatisation of all the generation and distribution companies owned by the government.
The report, which was said to have been drawn up by the African Finance Corporation (AFC) has further recommended that the corporation (AFC) be appointed adviser to the Federal Government during the transition period. The Chief Executive Officer of the AFC, Mr. Austine O. Ometoruwa, coincidentally is a member of the presidential committee on power.
Sources in the Ministry of Energy (Power) informed THISDAY that the recommendations, especially with regard to the establishment of an SPV for PHCN successor companies, were informed by the need to restore some sanity to the system.
An official said with the establishment of some kind of central coordinating unit to which all the 18 companies report to is necessary due to the lack of coordination and some degree of mismanagement that has occurred since their incorporation.
He said the coordinating units will have an arms-length light control over the companies, but they will be allowed to retain their autonomy.
However, the report is raising eyebrows among reform-minded members of the committee who have gone quietly to the president to caution him about the adoption of the recommendations in toto.
Their concerns stem from the fact that the Electric Power Sector Reform Act, 2005 provides for the unbundling of PHCN and the granting of autonomy to the successor companies, preparatory to privatisation.
A source explained that the setting up of an SPV would amount to the establishment of a new NEPA or PHCN and the same vertical management structure considered inefficient in the past.
Similarly, there are concerns that by injecting private sector funding for the completion of NIPP would amount to the indirect privatisation of the new power infrastructure, as the financiers will have a first lien on the assets.
Besides, the issue of which tier of government currently owns NIPP’s assets is still up in the air because the funds used for their construction was sourced from the excess crude account belonging to the federal, states and local governments, although the former Minister of Finance, Dr Ngozi Okonjo-Iweala had explained at some point that monies taken from the account was a loan.
Essentially what this means is that other than the Federal Government, the states and local governments are currently part owners of NIPP.
The presidential committee was set up on February 19 and charged with the responsibility of providing 6,000MW of generation, transmission and distribution capacity under the NIPP in 18 months.
The committee was put in place in a bid to give effect to the present administration’s pledge to end the country’s long-running energy crisis within the shortest possible time.
The committee’s mandate also includes adding an extra 11,000 megawatts of power generation capacity by 2011 through diverse sources.
The Minister of State, Energy (Power), Mrs. Fatima Balaraba Ibrahim, is the chairperson of the committee while the Chief Executive Officer of the Nigerian Electricity Regulatory Commission (NERC), Dr. Rowland Owan, serves as its secretary.
Other members of the committee are the Chief Economic Adviser to the President, Mr. Tanimu Yakubu, and Special Adviser to the President (Power), Mr. Joseph Makoju.
Also on the panel are Ometoruwa of AFC, Alhaji Aliko Dangote, Chairman of the Dangote Group; Group Managing Director of the Wempco Group, Mr. Lewis Tung; Executive Director of Exxon-Mobil, Mr. Cyril Odu; Executive Director of Sahara Energy, Mr. Kola Adesina; Chairman of IBTC Bank, Mr. Atedo Peterside, and Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mr. Abubakar Lawal Yar’Adua.
The terms of reference of the committee are to:
•Conduct an independent technical, financial and legal audit of infrastructure in Nigeria’s power sector;
•Source funding for the completion of ongoing NIPP projects based on terms and conditions mutually-acceptable to the Federal Government and investors;
•Provide inputs for the design of an appropriate securitisation structure to attract credible investors to the power sector; and
•Provide inputs for a power purchase agreement template that will ensure a reasonable level of return on investment for investors and affordable tariffs for consumers.
The Minister of State, Energy (Power) was directed by the president to review, summarise and submit the report for Federal Executive Council consideration next week Wednesday.

http://www.thisdayonline.com/nview.php?id=107168


hmmm, how does mr president intend to fund the power projects with the paltry sum allocated in the budget, whats wrongf with his advisers? hope something good can come out of it though,

hmmm, how does mr president intend to fund the power projects with the paltry sum allocated in the budget, whats wrongf with his advisers? hope something good can come out of it though,

well maybe they could revise the budget after this.

http://allafrica.com/stories/200803280419.html

the more you look the less you see. I do not know why it is taking us so long to get our things right in this country. May God forgive us.

money has never been the problem rather the people are the problems.
how many committees in the past had in the same manners submitted similar reports? how many of those reports was productive?
go into the activities of this committee and know how many billions that the committee used in making its findings and u will begin to appreciate that committees cost us more money than the projects themselves. what a shame? a people bent on decieving themselves.
the only committee that i will recognise in nigeria is that one that will say no to the ways of obj and think about the nigerian masses, that committee will mention the interests of the common man, that committee will convience nigerians that their salaries and benefits will be transfered to them via their legitimate accounts as against the ghana must go symdroms of everyother committee.

I was speaking today with my mum and we discussed how Idiagbon made running Nigeria look and appear so easy. I remember when the man took office, things started happening, for the first time in all my memory of that country I understood the meaning of Environmental sanitation and discipline. I wish people would remember what life was back then and how fairly quickly things happened back then compared to today. Corrupt officials were out of office the next day and in prison the day after back then. The price of bread fell drastically that you could eat 10 kobo bread and still have some left over compared to 50 kobo bread back during shagari's time. I mean this is not rocket science for crying out loud.