Nigeria's call for power attracts 37 firms

Thirty-seven power firms have indicated interest in supplying generation to power-short Nigeria, following the government's plan to privatize the electricity supply sector, government sources say. Officials say most of the companies are members of consortia representing energy equipment producers and power generation firms from the US, France, Israel, Singapore, the UK, Italy, Canada, and China.


Thirty-seven power firms have indicated interest in supplying generation to power-short Nigeria, following the government's plan to privatize the electricity supply sector, Nasir el-Rufai, director general of the Bureau of Public Enterprises, said Thursday. The firms, responding to solicitations run in United Nations publications and in local and international newspapers, have indicated an interest in providing between 49 Mw and 2,560 Mw of electric power. The director general noted most of the companies are members of consortia representing energy equipment producers and power generation firms from the US, France, Israel, Singapore, the UK, Italy, Canada, and China.

He said up to 5,000 Mw could be deployed in 6 months, subject to affordability, warranties, and the capacity of the nation's transmission and distribution network. The state-run National Electric Power Authority's (NEPA) plan calls for an additional 15,000 km of transmission lines, 16 new power plants, and new distribution and marketing facilities.

Power problems
After years of erratic performance and shortages, the government is making improved electricity supply one of its top priorities. El-Rufai said implementation of the independent power plan will be given priority by NEPA, the Ministry of Power and Steel, the Ministry of Finance, and other relevant government agencies.

Nigeria has 5,881 Mw of installed electric generating capacity. About 43% of Nigeria's population has access to electricity, but NEPA plans to boost this share to 85% by 2010. Industrial output has fallen drastically in the past because there is not enough power to run production. In most cases, manufacturing industries provide their own power supply infrastructure, known locally as "BYOI" (bring your own infrastructure), only to incorporate the cost into the final product price. Cadbury Nigeria, for instance, in the absence of reliable power, generates 8 Mw of electricity to run its Lagos food-processing plant.

The situation has led to spiraling inflation in a country where purchasing power is low. Some multinational oil companies operating in Nigeria have proposed producing and providing electricity from gas turbines to serve their host communities and possibly some other parts of the country, but negotiations are enmeshed in the political process. Three of the 36 states of the federation have almost concluded plans to engage independent power producers to augment erratic power supplies. At the top of the list is the Lagos state government, which has experienced slow but steady progress with its plans for the US-based Enron Power Co. to supply electricity to the state.

Nigeria has no sector policy incorporating the government's objectives or a regime of incentives and liberalization to guide the orderly growth and development of the power sector. However, the National Council on Privatization has prepared a power policy document, which will be developed into a comprehensive policy statement. This policy is expected to provide a broad overview of the government's plan for the power sector and indicate the work program required to complete the development of a suitable power strategy.

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