More than a decade after the Federal Government sold off of majority stakes in generation and distribution companies to private investors, the Senate yesterday threatened to tinker with the policy.
The upper chamber which described the privatization of the power sector in 2013 as a “total failure,” hinted of the possibility of coming up with legislative measures to upturn the policy.
The Red Chamber, in a resolution, berated power sector operators, including Generation Companies (GenCos), Transmission Company of Nigeria (TCN) and Distribution Companies (DisCos), for failing to deliver reliable electricity.
According to the lawmakers, the operators have added no significant value to the sector eleven years after they took over.
They lamented that rather than guarantee steady electricity supply, the privatisation has plunged Nigeria deeper into darkness, leaving citizens helpless.
The resolutions followed the presentation and consideration of a report by the Senate Committee on Power during plenary, which investigated frequent national grid collapses and related issues.
In the report, Committee Chairman Enyinnaya Abaribe (APGA, Abia South), attributed the persistent grid collapses to factors such as aging infrastructure, abandoned projects worth trillions of naira, regulatory inefficiencies, security lapses, lack of modern monitoring systems like SCADA, and inadequate financial oversight.
Abaribe lamented that despite substantial investments in electricity infrastructure, the grid has suffered 105 collapses over the past decade.
He highlighted the significant costs incurred during grid failures, particularly in restarting power plants.
According to the report, restarting a plant after a grid collapse (known as a “black start”) is considerably more expensive than normal operations.
For instance, while running costs for a plant like Azura, Delta, or Shiroro are approximately $105,000, restarting costs can reach $7 million per incident.
“Collectively, grid collapses cost Nigeria an estimated N42.5 billion for these three plants alone, with broader implications for the entire power sector,” the report said.
It also said that the National Grid, which is over 50 years old, is outdated and in urgent need of modernisation to meet current operational standards.
Abaribe also noted other pressing issues, including operational inefficiencies, abandoned projects, regulatory gaps, security challenges, and the absence of Supervisory Control and Data Acquisition (SCADA) systems essential for real-time monitoring and management.
Abaribe said: “Whenever a plant is shut down, they restart the plant and to restart it which they call a black start, it cost far more than running the plant.
“While it cost $105,000 to run the plant, to restart it will cost $7 million. 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 $25 million or N42.5 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.”
Senator Adams Oshiomhole (APC, Edo North), criticised the privatisation policy as flawed and exploitative, stating that it imposed undue financial burdens on Nigerians.
“The DisCos are out for profit while they make our people suffer. I never imagined that a private person will collect money for services he did not render and Nigerians are helpless,” Oshiomhole said.
He recounted 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.
He said: “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 privatization.”
On his part, Senator Abdul Ningi (PDP – Bauchi Central) added that the ongoing failures in the power sector persist due to a lack of accountability.
He argued that without sanctions for lapses, the sector’s inefficiencies would remain unaddressed.
Ningi 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.”
After the debate on the report, the Senate stood down the consideration of the report and gave Abaribe’s committee additional six weeks to do a holistic investigation into the issues in the power sector and report back for further legislative actions.
