FG Diversifies Sources of Power Generation

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Chinedu Nebo

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The federal government is intensifying efforts to generate power through different ways to meet the energy needs of the country

By Anayo Ezugwu  |  Mar. 30, 2015 @ 01:00 GMT  |

The federal government is not sparing any effort to achieve a healthy fuel mix for power generation in the country.  Already there is the 700 megawatts, MW, Zungeru Hydro Power Plant under construction; 17 small and medium Hydro Power Plants including the 40 megawatt, MW, Kashimbilla and 34MW Dadinkowa Dam. The government has also started developing the 3050MW Mambilla Hydro Plant and will soon do the Final Investment Decision.

There is also a renewed thrust in the development of coal to power with projects and to develop bankable feasibility studies to facilitate private sector participation. At the 2015 edition of the Nigeria Power Forum, Chinedu Nebo, minister of power, said the government has signed a memorandum of understanding with Zuma Energy for a coal-fired power plant in Enugu. Project plans have been developed to fast track the deployment of solar energy solutions with the roll out Operation Light-Up Rural Nigeria project across all the states of the Federation.

Nebo lamented that incidents of vandalism of oil and gas pipelines have blighted many of the achievements that have been recorded in increasing the supply of gas to power. “These acts by their sheer savagery and regularity have constrained the generation of power to much less than the current system capacity of about 5,500MW.”

According to Nebo, whilst government is leaving no stone unturned to bring these incidents under control and the perpetrators to book, it remains open to partnerships aimed at achieving lasting and sustainable solutions. He assured of government’s support in making the sector very profitable for investors. “I would also like to use this opportunity to assure our new and prospective investors, local and international, of the government’s continued support and interest in making the emerging Nigerian Electricity Supply Industry a very profitable investment destination.

The minister listed some of the power privatisation gains and achievements under his administration to include, appreciable increase in generation capacity by the new private sector owners of GENCOS with the following additions: Ughelli: from 160MW to 610MW (eventually to 1610MW) Egbin: from 1080MW to 1320MW. Kainji Hydro: from 80MW to 230MW (eventually to 470MW) Jebba Hydro: from 450MW to 546MW6. In addition, two National Integrated Power Projects, NIPP, Power Plants, namely Alaoji (960MW) and Calabar (563MW) were completed.

“The intervening year has seen unprecedented collaboration between the ministries of Power and Petroleum Resources. This by itself is a very commendable development given the obvious dependency of the Nigerian power Industry on gas. I am also very pleased to highlight a number of achievements of this collaboration. The increase in the price of gas-to-power from$1.50/mmBTU to $2.50/mmBTU with a maximum allowable gas transportation price of $0.80/mmBTU. The appreciable increase in the quantity of gas available for power generation to levels that can support the generation of up to 5, 500MW.”

He noted the remarkable milestone of the first supply of gas from a marginal field producer, Frontier Oil, to Ibom Power. Also, there was the settlement of legacy gas debts owed to gas producers by the erstwhile PHCN generation plants under the Central Bank of Nigeria, CBN, intervention facility for the Nigerian Electricity Supply Industry. He noted that the most recent was the execution of the long outstanding PRG for the Gas Supply Agreement, GSA, between Chevron and Egbin Power Plant. He said it was worthy of note that all the 10 NIPP Power Plants have now achieved gas supply.

“All these power plants are now on the way to being privatised with preferred bidders already announced. We expect in the coming months to have the transfer of the assets to the new private sector owners concluded. These achievements are a demonstration of what is possible and can be said to have set the scene for the way forward which will see Nigeria well on the path of meeting its target by 2020,” he said.

The minister said the federal government is intensifying efforts to secure gas pipelines across the Niger Delta region following the fourth attack on the Escravos Lagos Gas Pipeline A, ELPSA, in Delta State. He said the destruction has led to the loss of more than 200 mmscf/d of gas, equivalent to about 800 MW per day of generated power, noting that the latest attack on the gas pipeline which came less than 24 hours after the destroyed portions of the lines were repaired was an obvious act of sabotage.

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