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Why Nigeria is facilitating regional electricity market – TCN MD

What does the regional electricity market entail?  

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WAPP, in conjunction with ECOWAS Regional Electricity Regulatory Authority (ERERA), the regulatory body for West Africa, is hoping to launch the Regional Electricity Market (REM) by June 2018. Because of that, there are several sensitisations we are carrying out to sensitise member utility firms on the plan to kick off the regional market.

There are several things that are involved in the regional electricity market and synchronisation is just one of them. With synchronisation, it means that all the electricity that is generated across the sub-region would have to be synchronised so that from Nigeria to Cote d’Ivoire, we can have the same power frequency.

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As TCN, we anticipated this and that is why last year, we embarked on the frequency control which we achieved and attained at 49.5 Hertz (Hz) and 50.5Hz frequency for 24 hours in June 2017. In the last 20 years, that had not been achieved. It enabled WAPP and the rest of the country to synchronise their power to that level.

Does this market guarantee 100 per cent payment for bulk electricity purchase?

We have other mechanisms that we are putting in place to ensure full payment in the market but even as it is, the payment in the international market is far better than the local market and we are still working to improve it. On whether it will guarantee 100 per cent payment, I can’t tell you that because even in the WAPP sub-region, like Benin and Niger, the Distribution Companies (DisCos) are still the weakest link as they are not collecting all the money.

We are working with WAPP to improve the collection capacities of distribution firms by forming mechanisms that will guarantee payment like this synchronisation.

What is the update on the northern corridor transmission project?

The northern corridor is the transmission line that four countries plan to build to connect Nigeria with Benin, Niger and Burkina Faso. It will run from Birnin Kebbi in Nigeria to the border, and from Niamey in Niger Republic it will also tee-off to Benin Republic and also from Niamey, it will move to Burkina Faso. That line is being financed by the African Development Bank (AfDB) and the French development agency (AFD).

The component of the AfDB is focused on the side of Ouagadougou, Burkina Faso and Niamey in Niger Republic. That component has already been approved by the board of AfDB and the agreements signed with those countries.

The component that concerns Nigeria is about 62 kilometres from Birnin Kebbi to the border and we are discussing with the World Bank to finance it. All the studies for it have been carried out including the environmental disclosure. For us to be able to supply energy on that line, we also have to build a 330kV double circuit line from Kainji hydropower plant to Birnin Kebbi which is part of the Northern corridor project of TCN.

We have done the feasibility study and what AfDB is waiting for is the validation of the feasibility study which we have hired a consultant to do. We are at the final stage of completing the procurement of that contract.

Are we seeing it starting this year and what is the funding?

Everything is starting this year. The funding on the side of the project that concerns Nigeria is $29 million for about 62 kilometres of the transmission line from Birnin Kebbi to the border of Nigeria with Niger Republic. The distance of the entire transmission lines is about 700 kilometres. So it is a long distance transmission line.

What progress has WAPP made on the southern backbone transmission project?

The southern backbone project is a separate project that is under preparation. We are doing the environmental impact assessment which is supported by the AfDB. Once the study is completed, we will start looking for the financing. The grant given is $3 million and it is equal to the amount to pay for the study. They are paying for the contract we entered with the consultant.

As the chairman of WAPP and TCN head, how is regional participation repositioning Nigeria’s power sector?

Nigeria has always been the chairman of WAPP. What we have brought to the table is a different perspective of doing business. The recent training of TCN staff through collaboration with the Association of Power Utilities of Africa (APUA) came as a result of the certification of the National Power Training Institute of Nigeria (NAPTIN) as a Centre of Excellence and that is what we as TCN pushed for – to make NAPTIN a Centre of Excellence.

We have had a lot of arrears in the payment of our obligations to APUA but we cleared everything and are up to date. That was why the training of TCN staff happened. Besides, the northern corridor transmission line project will have the headquarters situated in Nigeria. This is also part of what we are doing to ensure that Nigeria takes its position rightfully in the regional electricity market.

How does the WAPP facilitate trade for Nigeria?

The purpose of WAPP is to enable trade between Nigeria and other countries. Trade creates jobs; if there is a Generation Company (GenCo) in Nigeria that sells power to Benin Republic, that company will create jobs for Nigeria. It is also creating business for our country because the company that is selling energy in Benin Republic will also be able to make profit.

The vision of the regional electricity market is also to provide energy security so that if tomorrow, Nigeria has a problem of gas supply, it can import energy from Ghana or Burkina Faso depending on which has cheaper source of energy. We are also not building transmission lines for just five to 10 years; it is something that should last for 100 years to boost electricity trade.

How is TCN working to improve the local electricity market?

For the Nigerian Electricity Market (NEM), we are doing many things to ensure things work differently. For transmission, we have invested significant amount of money to put enough capacity for transmission. We believe that in the next two to three years, we will have the N-1 international standard all over the country. 

We are making sure we optimise and implement our projects in the most effective way. If you check, almost on weekly basis, we are commissioning transformers.


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