THE Senate on Thursday, December 5, said that it might propose legislation to repeal the power sector privatisation policy on account of its ‘total failure’ and unimpressive impact.
The lawmakers also criticised the privatisation of the nation’s power sector, saying it’s fraudulent and exploitative.
According to the lawmakers, the sector’s privatisation has plunged Nigeria deeper into darkness, leaving citizens without solutions
They also condemned operators in the sector, comprising Generation Companies (GenCos), Transmission Company of Nigeria (TCN), and Distribution Companies (DisCos), over their inability to deliver reliable electricity, asserting that they had added no significant value to the sector.
Their reactions followed the presentation of a report by the Senate Committee on Power during Thursday’s plenary, which investigated frequent national grid collapses and related issues.
Senator Enyinnaya Abaribe (APGA, Abia South), who presented the findings, attributed the persistent grid failures to factors such as ageing infrastructure, abandoned projects worth trillions of naira, regulatory inefficiencies, security lapses, lack of modern monitoring systems like supervisory control and data acquisition (SCADA), and inadequate financial oversight.
According to him, despite substantial investments in electricity infrastructure, the grid has suffered 105 collapses over the past decade. He revealed the significant costs incurred during grid failures, particularly in restarting power plants.
He said, “Restarting a plant after a grid collapse (known as a “black start”) is considerably more expensive than normal operations.”
Citing an instance, he disclosed that while running costs for a plant like Azura, Delta, or Shiroro are approximately $105,000, restarting costs can reach $7 million per incident.
The ICIR reports that grid collapses cost Nigeria an estimated ₦42.5 billion for these three plants alone, with broader implications for the entire power sector.
Speaking further at the Senate, Abaribe noted other pressing issues, including operational inefficiencies, abandoned projects, regulatory gaps, security challenges, and the absence of SCADA systems essential for real-time monitoring and management.
“Whenever a plant is shut down, they restart the plant and to restart it, which they call a black start, it costs far more than running the plant.
“While it costs $105,000 to run the plant, to restart it will cost $7m. So anytime we have a shutdown occasioned by grid collapse, three plants in Nigeria that supply most of our electricity, Azura, Delta and Shiroro, to restart the plant cost Nigeria $25m or ₦42.5 billion and if we expand it to the rest of the operating plants in Nigeria, it is actually not quantifiable.
“Aging infrastructure has been identified as a critical factor contributing to frequent grid failures. Many components of the grid are outdated and have not undergone necessary maintenance or upgrades, leading to increased vulnerability to failures”, he added.
In his contribution to the debate, Adams Oshiomhole (APC, Edo North), faulted the privatisation policy as flawed and exploitative, stating it imposed undue financial burdens on Nigerians.
He said, “The Discos are out for profit while they make our people suffer. I never imagined that a private person would collect money for services he did not render and Nigerians are helpless.”
He recalled a personal experience of having to purchase a transformer and pay for its installation, only for it to become the property of the Abuja Electricity Distribution Company (AEDC). Oshiomhole called for a comprehensive review of the privatisation policy in line with the administration’s “Renewed Hope Agenda.”
“After the procurement, it becomes the property of AEDC (Abuja Electricity Distribution Company). I even had to pay money from my pocket to connect the transformer to the grid.
“We have to revisit this ill-advised privatisation and we are going to advise Mr President in line with his Renewed Hope Agenda, to review the power sector privatisation,” Oshiomhole suggested.
Abdul Ningi (PDP, Bauchi Central) added that the failures in the power sector had persisted due to a lack of accountability.
He argued that without sanctions for lapses, the sector’s inefficiencies would remain unaddressed.
He said: “Over the years, nobody has been punished for the lapses of the power sector. Reports alone without sanctions will not allow Nigeria to make any headway. The implication is that the problems will continue.”
The Senate stood down the consideration of the report and gave Abaribe’s committee an additional six weeks to do a holistic investigation into the issues in the power sector and report back for further legislative actions.
The ICIR reported that the power sector post-privatisation has failed to light up Nigeria despite over N7 trillion intervention to uplift the sector.
The sector was privatised on November 1 2013. However, it still relies on intervention support from the World Bank, the Federal Government and the Central Bank of Nigeria (CBN) to survive.
After privatisation, the sector was projected to grow its on-grid power to 40,000 MW in 2020. But as of 2023, on-grid power is slightly above 4,000MW, raising concerns about the efficiency of the privatisation.
