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Nigeria, Germany’s Siemens sign agreement to increase power supply

PRESIDENT Muhammadu Buhari has signed an agreement with a German technology firm, Siemens AG, to “dramatically” improve Nigeria’s reliable power supply to 11,000 megawatts by 2023.

According to the deal, the Phase1 will be completed in two years and Phase2 in 2023.

President Buhari agreed to the electricity roadmap with Siemens on Monday after meeting with Joe Kaeser, president of the German technology firm at the State House, Abuja.

The deal was the product of German Chancellor Angela Merkel’s meeting with Buhari on August 31, 2018.

During their meeting, Merkel and Buhari expressed commitment for future cooperation to support economic growth and development in Nigeria.

Buhari met with Kaeser during the meeting, who pledged to develop a feasible roadmap to modernise Nigeria’s electricity grid with support from the German Government.

“Today, in partnership with the German Government and Siemens AG, we are making an important move forward in addressing Nigeria’s electricity challenge. Our goal is a simple one: to deliver more electricity to Nigerian businesses and homes,” the president said after signing the deal.

He challenged Siemens and other partners to work hard in achieving “7,000 megawatts (MW) of reliable power supply by 2021 and 11,000 megawatts by 2023 – in phases 1 and 2 respectively”.

According to the Nigeria Electricity System Operator (NESO), the highest megawatts‘ generation  as of July 20, 2019 was 5,016.50 MW while the lowest was 3,139.80 MW.

This amounts to an average of 4,078 megawatts of power supply as of July 20.

President Buhari said only an average of 4,000 megawatts reliably reaches consumers.

“Despite over 13,000 megawatts of power generation capacity, only an average of 4,000 megawatts reliably reaches consumers,” he said.

He said earlier attempts at solving the electricity problem in the country yielded “an imbalance between the amount of power generated and the amount available for consumers”.

“This Government’s priority was to stabilise the power generation and gas supply sector through the Payment Assurance Facility, which led to a peak power supply of 5,222 MW,”he added.

He however noted that the constraints remained at the transmission and distribution systems.

“This is why I directed my team to ask Siemens and our Nigerian stakeholders to first focus on fixing the transmission and distribution infrastructure – especially around economic centres where jobs are created.

“Whilst it was evident that more needed to be done to upgrade the sub-transmission and distribution system, our Government was initially reluctant to intervene as the distribution sector is already privatised,” said Buhari.

After positive feedback from private-sector owners of the distribution companies, Buhari said they all endorsed the Government’s intervention to engage Siemens on the end-to-end plan to modernise the electricity grid.

By solving the electricity hitches in the country, president Buhari hopes to improve investor confidence, create jobs, reduce the cost of doing business and encourage more economic growth.

However, he said the new project would not be the solution to all problems in the power sector.

Siemens is a global powerhouse that helped countries like Egypt, Iraq in improving their electricity supply.

Siemens had successfully managed to boost Egypt’s power generation capacity by over 40 per cent by connecting 14.4 gigawatts to the Egyptian national grid.

This is enough power to supply over 40 million Egyptians with reliable electricity and provide much-needed power to different industrial sectors.

The CEO said the Egypt Megaproject that transforms the country’s power landscape would serve as a  “blueprint for building up power infrastructure in the Middle East and all over the world”.

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