Presidency orders reassessment of GENCOs, DISCOs

BPE’s fact-finding team arrives Lagos

President Muhammadu Buhari has ordered the reassessment of privatised power assets in Nigeria. A source at the Presidency, who disclosed this to New Telegraph, stated that the reassessment order was given based on some “mind-boggling” terms reached with new owners on behalf of government.
These terms, the source said, allegedly put the government at the receiving end in the deal. Such terms, he said, included “government’s pledge” to provide subsidy of N50 billion annually for two years to the investors. The inability to meet up with this term, the new owners claimed, was partly responsible for the difficulty they faced to accrue revenues. The government had, through the Central Bank of Nigeria (CBN), given N213 billion intervention funds to the distribution companies as part of the agreement in the last quarter of 2014.
New Telegraph learnt that a team of assessors on fact-finding mission from the Bureau of Public Enterprise (BPE) arrived Lagos yesterday to look into the books of the privatised assets in Lagos and environs. Although the assessors were in Lagos on Tuesday, November 10 on assessment of Ikeja Electricity Distribution Company, they are returning to Lagos to visit Eko Electricity Distribution Company and later to other privatised power assets across the country.
The assets include the Ibadan Electricity Distribution Company (IBEDC), Benin Electricity Distribution Company (BEDC), Port Harcourt Electricity Distribution Company (PHEDC), Abuja Electricity Distribution Company (AEDC), Enugu Electricity Distribution Company (ENEDC), Jos Electricity Distribution Company (JEDC) and Yola Electricity Distribution Company (YEDC).
Head, Public Communications, Alex E. Okoh, who confirmed the reassessment visit, however, said that the visit was based on initiative of the Director- General of BPE, Mr. Benjamin Ezra Dikki, whom he said, was keen on seeing that owners of the new power companies fulfilled the covenants they signed with the government.
He quoted the BPE team leader to Ikeja DISCO, Mr. Ignatius Ayewoh, to have said in a statement that Dikki approved the constant monitoring of the companies. But the source insisted that “new emerging facts” about the privatisation prompted President Buhari to inquire on what is actually the true state of the privatisation.
“The BPE is under the Presidency and the Director General of the agency has a direct order from the president to reassess the privatised assets and revert to him details of the privatisation,” the source said.
The Senate’s Ad hoc Committee on Privatisation had, on Thursday, echoed allegation of shady deals in the privatisation with accusation that the BPE, which represented the government, shortchanged Nigerians by failing to provide a responsible link between Nigerians and investors. Chairman of the committee, Senator Abubakar Kyari, disclosed how members of the BPE serving in the boards of the DISCOs and GENCOs received gifts such as Toyota Land Cruiser and Toyota Prado (SUVs) from the companies.
“I have the protection of the Senate to say what we have gathered. There are some members of staff of the BPE that are board members of generation companies and distribution companies who were given Prado and Land Cruiser Jeeps.
They are conniving with them,” Kyari said. His view was corroborated by another member of the committee, Senator Aliyu Abdullahi, who alleged that there was lack of co-ordination between the power sector and the BPE. According to him, BPE is saddled with the responsibility of negotiating for the country on the privatisation process and hence, needed to be technically and morally responsible to the country, but has been “short changing the country.”
These allegations were, however, denied by Dikki, who insisted that the BPE staff on the boards of the DISCOs and GENCOs were not seconded to the boards to obtain gifts, but to explore the veto power of the BPE to stop any investment by the power firms that is in contrast with their agreement with BPE. “We are there to protect Nigerians. What companies are paying or have given to their board members as privileges should be referred to the respective companies. Whether the privileges are right or not, I don’t know. I take exception that we have shortchanged the government.
We balanced the interest of government and investors because what we are looking for is investment. We need to create an enabling environment for the business to thrive,” he said. What the committee Chairman forgot to add, according to the Presidency source, is that the former Director General of BPE, Ms Bolanle Onagoruwa, who started the power privatization, was later appointed the Managing Director and Chief Executive Officer (CEO) of Ibadan Electricity Distribution Company (IBEDC), up till May 2015. The Ibadan DISCO is the biggest and one of the most lucrative DISCOs sold on November 1, 2013.
Former Minister of Power and Steel, Mr. Suleiman Bello, and the electricity workers had accused the BPE of rushing the privatisation process, adding that whereas investors were expected to bring money into the system, they ended up depending on Nigeria’s money to run their projects. Like Bello, President of the National Union of Electricity Employees (NUEE), Mr. Joe Ajaero, bemoaned the privatisation exercise for allegedly being turned into corruption exercise.
The source noted that one of the owners of the DISCOs donated N2 billion for the PDP in the build up to the 2015 general elections. In another development, the Chairman, Nigeria Atomic Energy Commission (NAEC), Dr Erapamo Osaisai, has said that Nigeria plans to make each of its nuclear power plants to generate power in excess of 1,200mw. He gave the indication in Abuja yesterday while speaking with State House correspondents after he submitted a report of the International Atomic Energy Agency (IAEA) on the development of nuclear power in Nigeria to Vice- President Yemi Osinbajo.
Osaisai said IAEA conducted an integrated nuclear infrastructure review mission in the country in June and that the nation’s nuclear power energy programme was on course to diversify power sources beyond gas and hydro bases. “Our nuclear power plants are huge machines. And what we are planning is, each of the power plants will be generating power in excess of 1,200 megawatts.
“Nigeria is a signatory to the nuclear non-proliferation treaty. We are a member of the IAEA and our responsibility as a country is to utilise nuclear power in the safest way possible.
“And what Nigeria is doing, as we can tell, is diversifying our energy generation base beyond gas and hydro to include other sources for which nuclear is also being considered.”
According to Osaisai, NAEC has a nuclear power road map “which is being approved by government and that is what we are implementing.”
He said that in the implementation of the road map, the organisation needed to build critical nuclear power infrastructure and enter into partnerships with international agencies and other technical partners.

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