NBET working with NERC to device better mechanism for improved electricity production
The management of the Nigeria Bulk Electricity Trading Company (NBET) has revealed that it was working assiduously with the Nigerian Electricity Regulatory Commission (NERC) to provide a framework aimed to increase electricity production in the country.
The framework according to NBET,is geared towards making more megawatts of power available but still reduce the risks having many active Power Purchase Agreements, PPAs operation in the system.
Managing Director and Chief Executive Office of Nigerian Bulk Electricity Trading Company, NBET, Dr. Nnaemeka Eweluka, disclosed this development, weekend, while speaking at a two-day capacity building workshop for members of Power Correspondents Association of Nigeria, PCAN, and the Civil Society Organisations, CSOs, Lagos Continental Hotels, Victoria Island, Lagos State.
Speaking further at the workshop with theme, “Building knowledge and plugging skills gap in power sector reporting”, Dr. Eweluka, was optimistic that the sector would soon experience tremendous growth on account of germaine policies formulations and huge financial commitment by the the Federal Government
According to him, “The issue of PPAs not working, I mentioned that NBET is working with NERC to actually ensure that the service based tariff regime is actually made effective so that when DISCOs are being held to account to supply X megawatts to customers, to make sure that the power is coming.
“Now based on that NERC, complaints of the GENCOs saying that the reason why they have their inability to produce is because they don’t have gas supply agreement and for them to activate this gas supply agreement, that there are all kinds of demands that they need to meet as far as the gas companies are concerned.
“And so we are working with NERC to create a kind of, to track or what are those things that need to happen in order to increase capacity availability from the existing power plants and that includes looking at the issue of do they have fund gas supply agreements, if they don’t have, how will they have fund gas supply agreements.
“So we have been having this meetings with NERC that are geared towards protection making non active PPAs active but in doing so, we are tracking where they power will go, making sure that there is alignment between the PPAs that you are making active with the distribution company that will take that electricity and pay for it.
“So there is a whole lot of meetings because we are conscious of the fact that there are merits but also potential downside of making PPAs active particularly when you have a system that has constraints.
“And so NERC and NBET are working on this to make sure that we provide the framework for making more megawatts available but at the same time mitigating against the risks of having active PPA’s all over the place.”
On the issue of gap between big demand and generation, Dr. Eweluka explained that, “Bridging the gap between peak demand and peak generation, it speaks to this market reforms because two things need to happen.
“The system must have the ability to physically move that additional power number one. Two if the system can move that additional power, and GENCOs actually are able to move that additional power, that additional power must be paid for.
“And so it goes back to the point I raised about having a sector that is financially healthy and technically robust and that is why this issue of having a coordinated approach, you see if you look at the responsibility from outcomes, just tally the number of government agencies involved tells you that coordination is at the key.
“So NBET has seen the need for these actions to be coordinated; it is like having the legs of an octopus. So what we are saying is that the eight legs of an octopus must work in sync because one leg alone is not enough which is why there are eight legs.
“How many legs do the millipede has but even for the millipede are those legs are important, every single one has a role.
“So what you are seeing here is how to get the market back on track. The fact that federal government has even set up these eleven initiatives, tells you that the government is keen to actually drive market reforms and that is why NBET is critical to this whole process.
“Now when you see this whole process, you will only see NBET feature in number one, right but all the other actions you see here are critical to NBET role, NBET implementation of its role.
“So really, the question you asked about timeline, for that timeline is a product of all these eleven actions happening that shows you the timeline.
“Now having said that because this government is keen to actually implement these reforms, to be honest with you, we are having sleepless nights to achieve this, they are milestones, they are targets and that is why I mentioned even with the Siemens project that is being aggressively pursued.
“Phase one seeks to achieve stabilize 7,000 megawatts and that is why I will encourage you to, beyond this meeting have engagements.
“For instance we said Siemens phase one 7,000 megawatts and on the issue of timeline, in your engagement you can engage …power co, that you understand that there is a 7,000 megawatts target for generation, transmission and distribution.
“What is the timeline for achieving this; so that you have a more complete picture on the timeline.
But what I can tell you is that the government is committed towards achieving these reforms as quickly as possible.”
