24HR ELECTRICITY SUPPLY IN NIGERIA IN 2014: HOW THE PEOPLE CAN MAKE IT HAPPEN - 1

As 2014 begins, it has become pretty evident that the current administration has nothing, but excuses, to show for all the funds spent on electricity supply in 2013.

It should be clear to Nigerians by now, that the job and responsibility for delivering 24hr electricity for Nigerians is way beyond what the government alone can bear.

If it were possible for government to provide 24hr electricity for Nigerians, we would have achieved it by now.

Since 1999, the Federal Government has spent billions of dollars to achieve this goal, it still failed.

It then begs the question.
Where does the problem(s) lie? Is it in the type (technology) of solution that is being adopted or is it in the people (Min.

of Power, Transco, Gencos, Discos, etc) and process (NERC, Bulk Trader, etc) deployed to deliver the solution?  The simple answer is all of the above, except for one Agency, the Nigerian Electricity Regulatory Commission (NERC).

The Commission has done a wonderful job in approving and publishing rules and regulations governing the electric power industry in Nigeria, and I make bold to say that the Agency was central to generating the level of interest that led to the eventual privatization of PHCN in 2013.

I wrote in an article in 2011 http://saharareporters.

com/article/practical-solution-nigeria%E2%80%99s-power-problem about a plan to adopt distributed generation strategy using diesel power plants to meet the short term electricity needs of Nigerians, pending when the government's power plan comes to fruition.

There were a number of reactions to the article, ranging from support to 'E no go possible with this government'.

The latter assertion turned out to be right, and that was my mistake.

One fundamental mistake I made in that article was to place the responsibility for implementing the plan in the hands of government.

I say it was a mistake, because policy changes that have occurred since I wrote the article bear me out, and I will explain later.

However, let me state it clearly, the responsibility for implementing the short term plan for 24hr electric power in Nigeria rests squarely with the PEOPLE.

Now, let me explain the policy changes that have taken place since I wrote my last piece.

On Wednesday March 7, 2012, the Nigerian Electricity Regulatory Commission (NERC) issued two regulations.

The two regulations are; the Independent Electricity Distribution Network (IEDN) and the Embedded Generation Regulations of 2012.

The regulations effectively make it possible for communities, local and state governments, as well as private investors to obtain the required license to generate and distribute electricity without recourse to the national grid.

The regulation on Independent Electricity Distribution Network, which I had the good fortune of contributing to, permits investors, communities, local and state governments to invest in electricity distribution networks in areas without access to the grid, areas that are currently poorly serviced and areas with existing distribution networks.

  Secondly, the regulation on Embedded Generation (EG) permits investors, communities, state and local governments to invest in electricity generation for their exclusive consumption  or for sale to eligible customers , using facilities of existing electric power generation companies or independent power producers.

The major implication of these regulations is that it marks the final deregulation of the generation and distribution segments of the electric power sector in Nigeria, part of the power sector reform embarked upon since 2005.

It also effectively removed electric power generation and distribution from the exclusive list of Federal Government powers, and thus makes it possible for States and Local Governments in Nigeria to embark on local electric power projects using distributed generation.

However, like I said earlier, government alone cannot bear the burden.

The solution I am proposing is not dependent on government; rather government will not have a choice, but to support it for its own good.

Government would realize pretty quickly that the people have finally decided to take their destiny and that of their children in their own hands, to do what is necessary to assert their fundamental right to constant and reliable electric power.

Regarding electric power supply in Nigeria, there is no room for hope anymore.

The only thing left is to act.
The Nigerian people need to act together in our various communities, with one common goal in mind - to provide 24hr electric power to ourselves and our families in 2014.

In fact, this should be every Nigerian's New Year resolution.

Each adult Nigerian should resolve to work with others, to realize the goal of 24hr electric power in their community in 2014.

Nigerians should use this New Year period to pray to God to remove the spirit of 'I better pass my neighbor' from our lives in 2014! If we all commit to it, it will happen, and I don't see any reason why we should act in the contrary.

The Proposed Solution - The People Power Plan (PPP) Estimates are that Nigerians rely on generating their own power through electric generators at about N60 to N75 per kwh.

  Even at that, about 40 per cent of the population does not even have access to electricity.

These new regulations present a rare opportunity for communities to form themselves into Community Electric Co-operatives (CECs), in order to give them the bargaining power to either directly generate and distribute electricity or enter into long term agreements with service providers in generation and distribution, with a view to providing constant, reliable 24hr electricity services to its members at affordable rates.

The goal of the CECs will be at least, in the short term, to remove their communities from the National Grid, and to generate and distribute their own power locally, sometimes via existing distribution (Disco) infrastructure.

Leveraging the power and influence of Community Development Associations (CDAs), community members, including households and businesses need to form themselves into Community Electric Cooperatives (CECs).

I have broken the final solution into four models for CECs to choose from.

Model 1 The cooperative will generate and distribute electric power to its members willing to buy electricity at affordable rates, in line with the MYTO.

Under this model, the cooperative will own all generation and distribution assets.

Model 2 The cooperative, acting as an eligible customer enters into a Power Purchase Agreement (PPA) with a Generating Company (Genco) to buy power from the Genco in bulk and then resell to cooperative members through a distribution system owned by the Cooperative.

Under this model, the cooperative owns the distribution assets.

Model 3 The cooperative acting as an eligible customer enters into a Distribution Network Lease agreement with an existing Disco or IEDN to utilize its network to distribute electric power from an Embedded Generator owned by the cooperative to its members.

Under this model, the cooperative owns the generating assets.

Model 4 The Cooperative will enter into separate long term Power purchase and distribution network lease agreements with a Genco and a Disco/IEDN to provide 24hr electricity to its members.

Alternatively, the cooperative may decide to enter into a single Power Marketing agreement with a Disco/IEDN.

However, the agreement contract will depend on the Disco/IEDN having a current, verifiable and enforceable long term PPA with a Genco, to guarantee 24hr electricity supply.

Under this model, the cooperative does not own any generation or distribution asset.

From the above, it can be surmised that the most cost-effective option, depending on each CECs location is Model 4.

However, it must be noted that the determination regarding which model to choose will be dependent on factors such as availability of credible GENCO and/or DISCO/IEDN partners.

All those questions will be answered at the feasibility study stage.

Electric Cooperatives and How They Work Electric Co-ops are owned by their customers, who are called 'members' due to their dual role as customer/owner.

Their primary mission is to provide access to electricity at affordable prices for every member in their service area.

Electric Co-ops were created as one of President Franklin Roosevelt's New Deal programs in the US.

It was designed to promote rural development.
The first electric co-op was created in 1934 in the back of a furniture store in Corinth, Mississippi, USA.

Within a few years, it had thousands of counterparts across the nation.

Today in the US, there about 930 electric cooperatives, which are the sole source of electricity for 42 million people in 47 states - nearly 12 percent of the American population.

They control $100 billion in assets and $31 billion in member equity.

The Community Electric Cooperatives concept has also worked very well in the Philippines and Bangladesh.

Structure of Community Electric Cooperatives 1.
The Co-operative will be a non-profit organized exclusively for the benefit of its members 2.

Depending on which model is chosen, the Co-operative will develop the capacity to generate, purchase, acquire and accumulate electric power energy for its members and the capacity to distribute, furnish, sell and dispose of such electric energy to its members and to non-members.

Additionally, the Co-operative may be responsible for constructing, erecting, purchasing, lease as lessee and in any manner acquire, own, hold, maintain, operate, sell, dispose of, lease as lessor, exchange and mortgage plants, buildings, works, machines, supplies, apparatus, equipment and electric distribution lines.

To be continued.
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Written By Victor Olapojoye olapojoye'@gmail.
com