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IPPG commends FG for winning bid to host African Energy Bank

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The Independent Petroleum Producers Group (IPPG) has applauded the Federal Government of Nigeria for wining the bid to host the Headquarters of the African Energy Bank (AEB).

In a statement signed by its Chairman, Abdulrazaq Isa, the IPPG noted that this highlights Nigeria’s leadership and strong commitment to advancing Africa’s energy goals.

It said further that, “this landmark achievement also underscores Nigeria’s leading role over the years in fostering regional integration and progress. Not only is this decision to host the Headquarters of the AEB in the country a further acknowledgement of Nigeria’s position as the continent’s leading hydrocarbon resource holder and human capital base in the energy sector, but also demonstrates the robustness and highly advanced nature of the country’s financial services sector.”

“The AEB will provide a solid foundation for financing and advancing energy projects across the continent, enabling the development of critical infrastructure and innovative technologies in the energy sector. This initiative will not only promote sustainability but also drive economic growth and industrialisation, creating massive job opportunities and ultimately contributing to a prosperous and sustainable future for the entire continent.”

“IPPG’ strong advocacy for the siting of the Headquarters of the Bank in Nigeria was premised on the immeasurable benefits it would bring to the development of the oil and gas industry and ultimately the Nigerian economy particularly at a time when the nation is grappling with an energy crisis. We therefore commend President Bola Ahmed Tinubu, GCFR, for his visionary leadership and dedication to the development of Nigeria’s energy sector. His administration’s proactive and strategic efforts have played a crucial role in securing this notable achievement.”

“Special recognition also goes to Senator Heineken Lokpobiri, Minister of State for Petroleum Resources (Oil); who passionately and vigorously championed the realisation of this significant milestone. His relentless commitment in ensuring Nigeria hosted the AEB’s Headquarter has simply been extraordinary.”

“We equally acknowledge the efforts of the entire Government, its agencies in the energy sector and all stakeholders whose collective hard work and dedication have made this remarkable victory possible.”

The Group further noted that the achievement is not just a victory for Nigerians but for the entire African continent.

“It symbolises our collective efforts to build a prosperous and sustainable energy future for Africa. This will enable the continent look inward and deepen collaboration in charting a course for meeting its energy needs.”

“IPPG is extremely delighted by this news and looks forward to partnering with the AEB in ensuring affordable energy, enhancing energy security and lowering the continent’s carbon footprint.” Isa said.

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Energy

FG offers free CNG conversion for commercial vehicles

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The Federal Government, on Thursday, declared that the conversion of petrol and diesel-powered commercial vehicles to run on Compressed Natural Gas is going to be free of charge.

It declared this in Abuja after signing agreements with various companies involved in the conversion of petrol and diesel-powered vehicles to operate on CNG.

It said commercial transporters under their different unions including the Road Transport Employers Association of Nigeria, National Union of Road Transport Workers, and Nigerian Association of Road Transport Owners, among others, would benefit from this.

The Programme Director/Chief Executive, Presidential Compressed Natural Gas Initiative, Michael Oluwagbemi, disclosed this to journalists after the government agency signed agreements with various companies in Abuja.

He said, “Today we’ve just signed with five partners with us here in the Federal Capital Territory that are participating in the Conversion Incentive Programme.

“The programme is tackling the barrier to Nigerian commercial transport operators to convert from PMS (petrol) to gas. Most of them have said that the cost of conversion is expensive, and so what we are doing here today is basically to respond to that concern.

“What is the government doing about it? First and foremost, for commercial operators that are unionised, I’m talking about the members of RTEAN, NARTO, and NURTW, through their unions they can benefit 100 per cent discount. That is, they will get the kits for free and installation will also be done for them for free.

“And this is going to be done through these certified conversion workshops that we are beginning to identify. We’ve identified about 123 of them, five of them are here with us today that we are going to be working with here in Abuja. As we expand across the country we will be activating more of them,” Oluwagbemi stated.

He said the second group of commercial transporters were the ride-share operators.

“So if you are a vehicle rider that is operating under Uber, Bolt, Lag-Ride, Move, etc, you will be able to also benefit from this programme. Today we have Bolt here with us that is signing and we hope to add the others very soon. Lag-Ride has already signed up and we are going to send the agreement next week.

“They will be able to benefit from a 50 per cent write-off on the equipment and then they will get installation for free. So that means the government will pay for these conversion workshops to install the equipment you will get at 50 per cent off.

“And because of the arrangement we have with these companies, you’ll be able to also get to pay little by little. So you’re not paying any money upfront on day one,” Oluwagbemi stated.

The P-CNGI director said through the implementation of this programme, Nigerians would start paying less for transportation.

He said, “We have over 20,000 kits that are immediately going to be available in the next three months through this programme. We will be distributing them across the states that have some CNG capacity or the other. The states are about 25 in number.

“This will ensure that the citizens within these states, the unions and ride-share operators would-be participants of the 20,000 potential kits that will be made available under this programme. The 20,000 kits were made available under the palliative initiative that was budgeted for last year.

“But the National Assembly has made additional funding available this year, and we will be rolling out additional kits once the necessary acquisition of materials is made available to us by the third or fourth quarter of this year.”

On the agreement that was signed in Abuja, he said, “It (agreement) is saying that in return for giving you these kits, you will also pass on the savings to ordinary Nigerians. So we will begin to have some impact in terms of transportation.”

Asked to state how the government would monitor the conversion centres, Oluwagbemi said, “We have a very strong monitoring mechanism around conversion as well as the enforcement of reduced pricing for Nigerians. The Nigerian gas vehicle monitoring system ensures that they are properly converted and then we can track them.

“Secondly, within the framework of the agreement we are signing with them, we’ve agreed on some significant pass-on of those savings that they will be realising. As they realise the savings, they are under obligation to report to us and make sure that the savings are passed on to ordinary Nigerians so that we do not defeat the purpose of the palliative.”

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Energy

Metering Initiative funding: FG deducts N120bn from April revenue as first tranche

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The Federal Government has set aside N120 billion as the first tranche of the Presidential Metering Initiative (PMI).

According to the Federal Account Allocation Committee (FAAC) disbursement report for May 2024 by the National Bureau of Statistics (NBS), the amount is from revenue made in April and shared in May.

The N120 billion is about 10% of the revenue share in May 2024 among the three tiers of government and 9% of the N1.325 trillion is expected to be spent on the PMI.

In May this year, Minister of Power, Adebayo Adelabu, said that the government will provide an initial N75 billion as seed capital while the Nigerian Sovereign Investment Authority (NSIA) pledged to inject a minimum of N250 billion annually for the initiative’s duration.

The minister also disclosed that the initiative will leverage debt financing from diverse financial institutions to bolster the PMI’s resources.

The Managing Director of Abuja Distribution Electricity Distribution Company (AEDC), Mr. Victor Ojelabi, recently said that the PMI will unlock about N1 trillion in revenue currently tied up in the Nigerian Electricity Supply Industry (NESI) due to a large number of unmetered customers.

Under the initiative, the Nigerian Electricity Regulatory Commission (NERC) announced the approval of N21 billion for the 11 electricity Distribution Companies (DisCos) to provide meters for end-use customers at zero cost.

This information was contained in ORDER NO: NERC/2024/072 on The Operationalisation of “Tranche A” of the Presidential Metering Initiative Under the Framework of Meter Acquisition Fund.

While campaigning for the presidency, Bola Tinubu released a manifesto outlining a plan to eliminate estimated billing and ensure that all Nigerian homes and businesses are equipped with prepaid meters.

However, under his administration, the number of estimated billing customers has seen the largest growth rate both quarterly and yearly, based on data from the NBS up to 2022.

Recall that the federal government’s plan to eliminate estimated billing by the end of 2024 faces significant hurdles, as evidenced by the recent increase in the number of customers on estimated billing across Nigeria’s electricity distribution companies (DisCos).The Nigeria Electricity Report by the National Bureau of Statistics (NBS) for the first quarter of 2024 shows a 10% quarter-on-quarter increase in estimated billing customers, as the metering gap widens.

The number of customers on estimated billing rose from 5.83 million in Q4 2023 to 6.43 million in Q1 2024, marking a notable 10% increase.

On a year-on-year basis, the rise in estimated billing customers is equally significant. From Q1 2023 to Q1 2024, the number of estimated billing customers increased by 8% from 5.96 million.

This increase occurs as the government continues to subsidise customers not on Band A, while Band A customers on estimated billing are still required to pay based on estimation.

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Energy

USAID pledges N115.2bn grant to FG to support power reforms

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The U.S. Agency for International Development (USAID) has pledged a N115.2 billion grant to the Federal Government of Nigeria to support its ongoing power reforms.

The USAID yesterday made this known while signing a memorandum of understanding (MOU) to support electricity sector reforms, market transparency, and expanded access to sustainable, reliable, and affordable power for Nigerians with the Federal Ministry of Power, Nigeria.

USAID/Nigeria Mission Director, Melissa A. Jones, and Permanent Secretary of the Ministry of Power, Mahmuda Mamman signed the MOU.

The MoU will facilitate the implementation of a N115.2 billion (approximately $75 million) U.S. government grant-funded technical assistance program for power sector development and reforms in Nigeria.

This new initiative aims to strengthen policy frameworks, enhance regulatory capacities, and encourage private sector participation, driving Nigeria towards its clean energy and net-zero carbon emissions targets. The Ministry is committed to ensuring these interventions deliver tangible benefits to all Nigerians, promoting economic growth and sustainable development.

Currently, over 85 million Nigerians lack access to grid power, while many others face unreliable supply. These challenges force many Nigerian families and businesses to rely on expensive, emission-intensive gasoline and diesel backup generators.

Director Jones emphasised the U.S. government’s commitment to advancing electrification in Nigeria, stating, “Today’s goal is to strengthen collaboration between USAID and the Federal Government of Nigeria and provide a framework for partnerships with other key actors, including state and local governments, electricity generation and distribution sectors, and the off-grid sector.”

Power Africa Coordinator, Richard Nelson, attending the signing ceremony during his first official visit to Nigeria, noted, “Nigeria is at the core of Power Africa’s strategy. I look forward to elevating our partnership to advance Nigeria’s progress towards our shared goal of ensuring access to reliable, sustainable, affordable power for all.”

In his remarks, the Minister of Power, Adebayo Adelabu expressed gratitude for USAID’s support, emphasising the partnership’s potential to transform Nigeria’s power sector.

He stated, “This collaboration with USAID is a significant milestone towards achieving sustainable and reliable electricity supply for all Nigerians. Together, we will address long standing challenges, ensure transparency, enhance market liquidity, and accelerate our transition to clean energy solutions.”

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