To say that it is ‘appalling and disheartening’ that Nigeria’s power sector has yet to see the required improvement for a greater effect on the people and the economy despite massive investments by successive governments is an understatement.
That, however, was how Mr Femi Otedola, Executive Chairman, Board of Directors, Geregu Power Plc, described the state of the power industry this week.
Otedola, who admitted that the sector faces challenges, noted that they are manageable. The main issue he mentioned is transmission, and everyone questions, as he did, why successive governments have seemed unable to resolve the transmission issue.
Speaking at the “Closing Gong ceremony” and commemoration of the company’s first Annual General Meeting (AGM) on the floor of the Nigerian Exchange Limited (NGX) in Lagos, Otedola revealed the hard truth that if the power sector was well organized, it would be cheaper and have a lot of positive impact on the manufacturing sector as well as the country’s overall economy.
“The power sector faces numerous challenges, but they are manageable.” It is a question of national leadership and willpower. It is even less expensive if electricity is well organized.
“It’s just a matter of time before we get there.”
The business mogul questioned why it is so difficult for the nation to increase its power generation capacity when an individual like Aliko Dangote has built 2000 megawatts for his plants. “Aliko, an individual, has constructed 2000 megawatts of power for cement, fertilizer, and refinery plants.” And the nation where I was born only has 5000 megawatts of power. “It is appalling and disheartening that all successive governments have failed in this regard, but I believe we are now at a point where the power sector will receive a great deal of attention and priority.” We have new plants that the government built years ago that are still sitting idle, and the true problem is transmission; there is a need to look in this area,” he said.
He also stated that Geregu was expanding its capacity to deliver better performance and maximize shareholder wealth, emphasizing that the sector’s challenges could be addressed if the government prioritized correctly. For starters, he believes that engaging investors in the sector is the best path forward.
“Any government that thinks clearly will seek out entrepreneurs in this sector who have invested so much capital and time and allow them to solve the problem.”
“Today, we would still be importing cement if the government had not invited Aliko to build a cement factory and create an enabling environment.”
While honoring Geregu’s accomplishments on its first anniversary as a listed company, Otedola emphasized the importance of any company being listed on the stock exchange in order to maintain its wealth.
“You need to list your company on the stock exchange to sustain wealth,” he said, adding, “We’ve come with a lot of firsts; the first power company to list on the Exchange, the first power company to embark on an aggressive 300% expansion drive, the first company to release its results on the stock market.”
In a related development, Doron Grupper, a director of the power holding company who is pleased with the power company’s accomplishments thus far, revealed that Geregu has professionals and excellent management to expand its capacity. “I’ve been with Geregu for many years, ever since we built the power plant. According to my knowledge, this power plant runs on natural gas. We have a great team of professionals and competent management to help us grow.
“We are currently producing 450 megawatts, but we have the potential to increase to 1300 megawatts in the next two years.” We have the money and the people, but we need the government of Nigeria’s help to solve some problems with gas. “We have a huge potential to increase and contribute to Nigeria in the power sector, and to increase the quantities and capacity of electricity to the people of Nigeria.”
Grupper told Arise, TV correspondent, on the sidelines of the NGX event on Tuesday that the gas challenges are related to the price of gas, which he observed is still low and needs to be raised.The difficulties are also related to the amount of gas and “the pressure of the pipeline; we need to increase it.” These are the three major issues that the government must address in order to assist us in increasing our capacity.”
“I hope that we will enter a new era of electricity here in Nigeria in the near future,” he added.
In terms of how much money has been invested in Geregu, he stated, “When we bought the power station in 2015, we produced 113 megawatts.” To get to 450, we had to do a significant overhaul. Now we’re doing another big overhaul that will cost more than $250 million.”
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