NIPP Plants Built Outside NERC Framework

Fri, Jun 5, 2015

By publisher

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The Nigerian Electricity Regulatory Commission says the 10 National Integrated Power Projects were built outside its regulatory framework, making it impossible for them to control the projects to improve electricity supply in the country despite $20 spent on them

| By Anayo Ezugwu | Jun 15, 2015 @ 01:00 GMT |

TEN National Integrated Power Projects built by the Nigerian government were done outside the stipulated regulatory framework of the Nigerian Electricity Regulatory Commission, NERC. This development may have resulted in the huge sums invested in the industry without commensurate improvement in electricity supply.

Sam Amadi, chairman, NERC, said that one of those projects outside the commission’s control was the construction of the 10 NIPP plants. Amadi spoke on Monday, June 1, during a phone-in radio programme on Raypower FM. While responding to a question on the statement by President Muhammadu Buhari that about $20 billion investments in the power sector had not brought commensurate electricity supply to the country, the NERC boss stated that although he could not state the actual figures invested in the sector, most of the invested sums were done outside the commission’s control.

“But the beauty of where we are now is that apart from government projects, every project coming into the sector passes through a prudent regulator. In the past, there were investments that were either irrelevant, corrupt, lacked discipline, or were stranded assets that were not networked to produce power. Up until now, or just in the recent past, we didn’t have the control over government projects. I’ll give you an example, the NIPPs.

“Some people have the feeling that the NIPPs are too expensive or that so much was spent building them. Now, as a regulator, those projects were built outside the regulatory framework. So, there’s no way we can determine whether they were prudent or not. What I am saying is that the $20billion, whether it is commensurate or not, came up over a period of time when NERC was not there,” he said.

Amadi, however, expressed optimism that with the quantum of electricity expected from the NIPPs as well as the power that would be generated from renewable energy sources and coal, the country would be able to hit 31,000 megawatts. He was careful not to state when this will realised.

The Niger Delta Power Holding Company, NDPHC, owners of the NIPP plants had in May this year said that the persistent disruption of pipelines that supply gas to integrated power plants has left the plants dormant in the past two years. James Olotu, managing director, NDPHC, stated that the disruption of the gas supply through constant vandalism had made the turbines in the various power plants idle.

“When the gas turbines are not running, you cannot have power. But any moment that gas supply is sustained, all the power plants will come alive. Take for instance, the NDPHC has plants in Olorunsogo, Omotoso, Ibobo, Geregu and Sapele; now, if the gas pipelines in the Niger Delta area and the South-West are disrupted, it means there will be no gas to sustain the power plants in that regions.

“As of last week, those plants were only running at one unit each. Take Olorunsogo that has the capacity to generate up to 600 megawatts as an example, just one gas turbine is running; this means that the plant is limited to about 170 megawatts. Therefore, what we’ve been having in the last one year is this persistent damage of the gas pipelines, making it impossible for the generation assets already built to generate power. The power plants are available but they are sitting idle,” he said.

Olotu explained that of the company’s 10 plants, seven were currently running although at much reduced capacities, while three were at different levels of being completed. “At the moment, we have Calabar, Olorunsogo, Omotosho, Sapele and Geregu power plants on the grid. The ones that were built next to gas facilities are the ones in Gbarain, Omoku and Egbema. As against the power plants that are currently running in the grid, none of those

three is running. The other ones that are under the NDPHC are the ones that are away from these major gas sources.”

The NIPP was conceived in 2004 as a fast-track initiative to add significant new generation capacity to Nigeria’s electricity supply industry. The generation plants were accompanied by supporting transmission, distribution and gas transport infrastructure projects.

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