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Energy Lawyer Adeyeye Deems NERC’s Subsidy Removal Essential For Power Sector Efficiency

Adeyeye says Nigeria doesn’t lack the capacity to produce sufficient amounts of electricity, the price has just not been right.

The bold move by the Nigerian Electricity Regulatory Commission (NERC) to eliminate subsidies for 15% of electricity consumers in Nigeria has triggered an outcry from the vast majority of Nigerians who have described the hike as inhumane, sensitive and antipeople.

The hike has also raised concerns about the stability of power supply moving forward.

In an interview with ARISE NEWS on Tuesday, Energy Lawyer from Generation(Gencos), Adetunji Adeyeye while commending NERC, addressed some of the concerns around the challenges facing power supply in the country.

He said the step taken is the correct course of action, believing it will ultimately lead to achieving the goals outlined in Nigeria’s power policy document from 2001.

“The action of the Nigerian Electricity Regulatory to remove subsidy for 15% of the electricity consumers in Nigeria is bold, decisive and intentional and is the right step for us to have efficiency in our power sector.

“The problem of the power sector is basically two things. One, the inadequate infrastructural backbone and secondly, the right pricing. It’s not that we don’t have the capacity to produce adequate or sufficient amounts of electricity that we need in this country, it’s just that the price has not been right to drive the investment that will give us this power.

“NERC by gradually starting a journey of righting the price and removing subsidy from some group of electricity consumers, I say is the right thing and it will be what will lead us ultimately to sufficient power as envisioned in the Nigerian power policy document of truth, 2001”

Concerning the capability of the NERC to oversee and enforce compliance, ensuring that Nigerians receive the full benefit of the electricity they are paying for, he said, “NERC is not only there to check the data but also to make sure that performance is given and is driven by both operators and that the consumer enjoys the benefit of service that they are being paid for.

“This NERC that we have currently is really primed and they are well positioned to apply both the carrot and the stick when necessary to operators to make sure that Nigerian citizens get the benefit of the service they pay for in the electricity industry.”

Adeyeye also attributed the problems of the power sector to generation, adding that these challenges are solvable and are actively being addressed by the government, but will require a long-term, marathon-like approach rather than a quick fix.

He expressed optimism that the action taken by NERC will enhance the efficiency in Nigeria’s power sector and increase electricity generation.

“The challenges we have in the power sector also dovetail to generation and in generation we have quite a number of challenges. If you look at our generation or fuel sources, it’s basically hydro and gas. Gas is the major bulk of our source of power in Nigeria. When it comes to gas, we have unavailability of gas,the price of gas, the transportation of gas, gas constraint delivery.

“In spite of all these challenges, I would say there has been sufficient initiative on the side of government and also some investors that play in this space despite the problem. The solution is a solution that will be a marathon solution, not a sprint. The way our gas infrastructure is built in Nigeria, it wasn’t even built to deliver gas for power. So it’s those inadequate infrastructure that are not there that government are now trying to plug, and that’s why generation has been gradual. So, I see these challenges as something that we are trying to fix, it’s fixable and we will eventually get there.

“This step that NERC has taken is the step that will bring all effort to begin to align to a better efficient power sector in Nigeria. With this sort of right pricing, I think generation volume will go up.”

Melissa Enoch

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