ECN, NEPA, PHCN AND DISCOs: How Nigerians pay for darkness

Mon, Jun 27, 2022
By editor
9 MIN READ

Essay

INTRODUCTION

NIGERIA is Africa’s biggest oil producer, but the West African nation struggles to meet its energy needs, a struggle that has persisted for many decades. This is often caused by intractable problems of generation and transmission. In 2022 alone, the country’s national grid collapsed at least five times. Today, let us x-ray the operations in other nations, what they do, and see what makes them different from Nigeria.

ELECTRICITY GENERATION & SUPPLY IN SOME COUNTRIES

SOUTH AFRICA

Eskom is the state-owned electricity provider. A 2016 study compared long term prices of different types of new power plants. As at 2020, coal generated 86% of electricity in South Africa, so the carbon intensity of electricity generation is higher than most other countries at over 800 gCO2/kWh

Eskom is a South African electricity public utility, established in 1923 as the Electricity Supply Commission (ESCOM). Prior to the establishment of Eskom the provision of electricity was dominated by municipalities and private companies. The city of Kimberley was the first user of public electricity in South Africa when it installed electric streetlights run off a coal fired power plant in 1882 to reduce crime at night.  The first central power station and distribution system in South Africa consisting of a 150 kW generator with two boilers and located at Cape Town Harbour was completed in 1891 to supply power to government buildings in the nearby city. In 1893 the town of Wynberg in Cape Town opened a power station to provide power to a local tram system and public streetlights. This was followed by the first municipal power station built by the City of Cape Town in 1895 with the construction of the Graaff Electric Lighting Works to power 775 streetlights. Not all early power stations were successful, such as the short lived President Street Power Station in Johannesburg. Constructed in 1906, the use of unsuitable fuel in an experimental engine design lead to an explosion in 1907.

Eskom was founded by the Electricity Act of 1922 which allowed for the establishment of a government owned non-profit company to provide electricity. In 1948 Eskom bought out the Victoria Falls and Transvaal Power Company with government support for £14.5 million (roughly equivalent to £2.55 billion in 2017) to become South Africa’s primary electricity provider. Eskom dropped its non-profit mandate in the late 1970s and government control over the company was expanded in 1998 with the passing of the Eskom Amendment Act.

GHANA

In Ghana, electric power is generated from hydropower, fossil-fuel (thermal energy), and renewable energy sources. Electricity generation is one of the key factors in order to achieve the development of the Ghanaian national economy, with aggressive and rapid industrialisation; Ghana’s national electric energy consumption was 265 kilowatt hours per capita in 2009.

Ghana exports some of its generated energy and fossil fuels to other countries. Electricity transmission is under the operations of Ghana Grid Company. The distribution of electricity is under Northern Electricity Distribution Company and Electricity Company of Ghana. The first Ghana government-sponsored public electricity supply in Ghana commenced in the year 1914 at Sekondi-Takoradi, operated by the Ghana Railway Administration (Ghana Railway Corporation). Power supply was extended to Sekondi-Takoradi in 1928. The Ghana Public Works Department had commenced a limited direct current (DC) supply in Accra during 1922. A large alternating current (AC) project started on 1st November, 1924, and a small plant consisting of three horizontal single cylinder oil-powered engines was installed in Koforidua in 1925. In 1926, work started on electrical distribution to Kumasi. A restricted evening supply commenced in May 1927, and a power station was brought into full operation on 1st October, 1927. In the same year DC supply was installed at Winneba but this was subsequently changed to AC by extending an existing supply from Swedru and during the period 1929-30, a limited electricity supply was extended to Tamale until a new AC plant was installed in 1938. 

The next power station to be established in Ghana was Cape Coast in 1932. This was taken over by the Ghana Electricity Department in 1947. A Ghanaian power station at Swedru was later commissioned in 1948 and this was followed by the installation of generating plants at Akim Oda, Dunkwa-on-Offin and Bolgatanga in 1948. On the 27th  of May, 1949, an electricity supply was made available at Nsawam through the building of an 11 KV overhead transmission line from Accra. The Keta electricity supply which was included in the programme was delayed by staff difficulties and was not commissioned until 1955.

The Tema power station was commissioned in 1956 with a 3 x 650 kilowatts (870 hp) diesel generating set. The Ho power station followed in 1957 and from 1961-64. The Tema power station was extended to a maximum capacity of 35,298 kilowatts (47,335 hp), thus, making it probably the biggest single diesel-powered generating station in Africa. In 1963 the Ghana Electricity Division brought into operation the first 161 kV transmission system in Ghana, which was used to carry power from the Tema Power Station. At its peak in 1965, about 75 percent of the power was used in Accra. In 1994, Ghana’s total generating capacity was about 1.187GW, and annual production totaled approximately 4.49GW. The main source of supply was the Volta River Authority with six 127MW turbines installed at the Akosombo Hydroelectric Project. At this time, this project provided the bulk of all electricity consumed in Ghana, some 60 percent of which was purchased by Volta Aluminum Company (Valco) for its smelter. The power plant export amounted to an estimated equivalent of 180,000 tons of oil in 1991.

The balance of Ghana’s electricity was produced by diesel units owned by the Electricity Corporation of Ghana, by mining companies, and by a 160MW hydroelectric plant at Kpong, about 40 kilometers downstream from Akosombo. A third dam at Bui on the Black Volta River that was completed in 2013.

KENYA

According to Statista, Kenya generated 1.043 gigawatts as of August 2021. KenGen recorded a new energy gross demand peak of 0.873 gigawatts as of November 2021. Kenya imports electricity from Uganda and Ethiopia. The current population of Kenya is 55,577,585. Electricity is generated by hydro, geothermal, thermal and wind power plants. Kenya Electricity Generating Company (KenGen) is the leading supply company, now operating in a liberalised market in which four other companies account for approximately 20 per cent of electricity. The Kenya Power and Lighting Company transmits, distributes and retails electricity throughout the country, while the Energy Regulatory Commission is the regulator for the energy sector.

UNITED STATES

The electricity sector of the United States includes a large array of stakeholders that provide services through electricity generation, transmission, distribution and marketing for industrial, commercial, public and residential customers. It also includes many public institutions that regulate the sector. In 1996, there were 3,195 electric utilities in the United States, of which fewer than 1,000 were engaged in power generation. This leaves a large number of mostly smaller utilities engaged only in power distribution. There were also 65 power marketers. Of all utilities, 2,020 were publicly owned (including 10 Federal utilities), 932 were rural electric cooperatives, and 243 were investor-owned utilities. 

The electricity transmission network is controlled by Independent System Operators or Regional Transmission Organizations, which are not-for-profit organizations that are obliged to provide indiscriminate access to various suppliers in order to promote competition. 

The four above-mentioned market segments of the U.S. electricity sector are regulated by different public institutions with some functional overlaps: The federal government sets general policies through the Department of Energy, environmental policy through the Environmental Protection Agency and consumer protection policy through the Federal Trade Commission. The safety of nuclear power plants is overseen by the Nuclear Regulatory Commission. Economic regulation of the distribution segment is a state responsibility, usually carried out through Public Utilities Commissions; the inter-state transmission segment is regulated by the federal government through the Federal Energy Regulatory Commission. 

NOW THIS

Principal sources of US electricity in 2019 were: natural gas (38%), coal (23%), nuclear (20%), other renewables (11%), and hydro (7%). Over the decade 2004–2014, the largest increases in electrical generation came from natural gas (2014 generation was 412 TWh greater than 2004), wind (increase of 168 TWh) and solar (increased 18 TWh). Over the same decade, annual generation from coal decreased 393 TWh, and from petroleum decreased 90 TWh.

In 2008 the average electricity tariff in the U.S. was 9.82 ¢/kWh. In 2006–2007 electricity tariffs in the U.S. were higher than in Australia, Canada, France, Sweden and Finland, but lower than in Germany, Italy, Spain, and the UK. Residential tariffs vary significantly between states from 6.7 ¢/kWh in West Virginia to 24.1 ¢/kWh in Hawaii. The average residential bill in 2007 was US$100/month. Most investments in the U.S. electricity sector are financed by private companies through debt and equity. However, some investments are indirectly financed by taxpayers through various subsidies ranging from tax incentives to subsidies for research and development, feed-in tariffs for renewable energy and support to low-income households to pay their electric bills.

The development of renewable energy and energy efficiency marks “a new era of energy exploration” in the United States, according to President Barack Obama.  In a joint address to the Congress on February 24, 2009, President Obama called for doubling renewable energy within the next three years. From the end of 2008 to the end of 2011 renewable energy increased by 35% and from the end of 2008 till the end of 2014, 41.4%. Renewable energy accounted for more than 17 percent of the domestically-produced electric energy used in the United States in 2017, up from 9.25% in 2008. In the past ten years, wind production has increased by 359% (4.59×) and now provides over 6.3% of US electric requirements. Over this same time period solar has increased by 5100% (52×) and now provides 1.32% of US electric energy needs. According to a report by the Interior Department, U.S. wind power – including off-shore turbines – could more than meet U.S. electricity needs. The Department of Energy has said wind power could generate 20% of US electricity by 2030.

Several solar thermal power stations, including the new 64 MW Nevada Solar One, have also been built. The largest of these solar thermal power stations is the SEGS group of plants in the Mojave Desert with a total generating capacity of 354 MW, making the system the largest solar plant of any kind in the world. (To be continued).

AND THIS

CRACK YOUR RIBS

“Teacher: What’s the opposite of Antibiotics?

Student: Unclebiotics”. (Anonymous)

THOUGHT FOR THE WEEK

“Give light and people will find the way” (Ella Baker).

LAST LINE

God bless my numerous global readers for always keeping fate with the Sunday Sermon on the Mount of the Nigerian Project, by humble me, Chief Mike Ozekhome, SAN, OFR, FCIArb., LL.M, Ph.D, LL.D. kindly, ride with me to next week’s exciting conversation.

First published June 27, 2022 C.E

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