Nnaji – Why Independent Power Projects Are Delayed

No Comments » January 23rd, 2008 posted by // Categories: Energy Development Project




Nnaji: Why Independent Power Projects Are Delayed

By Chika Amanze-Nwachuku, 01.23.2008

Professor Bart Nnaji, former Minister of Science and Technology and President of Independent Power Providers Association of Nigeria, has explained why some of the Independent Power Projects (IPPs) are yet to take off.

Nnaji, whose power plant was commissioned in Aba, Abia State, last year, also refuted insinuations that independent power licensees had nothing on the ground to show as investment in the sector.

Of the 20 companies issued licences last year by the National Electricity Regulatory Commission (NERC) to build power plants, Nnaji said some of the projects have been completed, while some are at advanced stages.

According to him, some of the licensees have not commenced work on the project sites because they had to first complete the Environmental Impact Assessment (EIA), which he noted takes between 18 and 20 months.

He explained that because licensees had to first complete the engineering works, nothing would seem to be happening at the project site “when the firms may have spent millions on engineering designs”.

He disclosed that some of the IPPs, including Ibom Power Plant being built by a firm, Group Five of South Africa; Aba IPP, owned by Geometric power, are close to completion and would come on stream by the end of this year. 

He also stated that one of the three projects by the Rivers State Government had been completed, while others were at advanced stages, including the one by Negris Engineering and the Agip-Okpai plant.

He maintained that quite a number of licensees had reached advanced stages in the projects, adding that power plants take a while, “up to between four and six years to come on stream”.

On allegations that NERC is like a toothless bulldog, he said: “if the government is not forthcoming with reforms in the sector, there is little or nothing it can do “because it is just a regulatory agency”.

He, however, stressed that the only way to ensure that billions of dollars expended by successive administrations on the power sector translate into production and delivery of energy to the generality of Nigerians is by allowing more private sector participation in the sector.

Speaking against the backdrop of the statement President Umaru Musa  Yar’Adua that his predecessor, Chief Olusegun Obasanjo, spent $10 billion (N1.22 trillion) on the power sector with nothing to show for it, Nnaji said if the private sector was allowed to manage power, Nigerians would see a lot of difference.

He argued that Yar’Adua was right in his decision not to allocate money to power in the 2008 Appropriation Bill, saying the president might have been considering other methods to deliver the various aspects of the power projects by involving the World Bank and the private sector.

“I think the president was right in that decision. He is probably correct not to apportion money again to power when there are other methods to deliver various aspects of the project. The private sector is there. The World Bank is there to manage the numerous power projects.  It is a better way to do it. If the private sector manages them, the money will be wisely utilised and every one naira will be accounted for.” he said.

He, however, disagreed on the different figures being bandied around to have been expended on the National Integrated Power Projects (NIPP), disclosing that to the best of his knowledge, “only a little over $2billion has been spent on the scheme so far”.


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