The Managing Director of the Transmission Company of Nigeria (TCN), Mr. Usman Gur Mohammed, in this interactive session with Journalists
over the weekend in Abuja, said the achievements recorded by TCN through transmission, rehabilitation and expansion of grid networks cannot yield 100% power supply to Nigerians unless there is commensurate efforts on the part of the Distribution Companies (DISCOs) to re-capitalize and expand the distribution networks…DELE OGBODO, covered the media briefing for SHARPEDGENews Online.
Excerpts…
QTN: What is the status on the re-capitalization of the DISCOs, coming with the appointment of 2 Bureau of Public Enterprises (BPE) members to sit on their board?
ANS: First, on the appointment of BPE members as directors on the board of DISCOs, our position is that the members from Ministry of Finance should be ones to sit on the board of the DISCOs. We believe that BPE are the managers of the performance contract, how can you manage what you are part of and would you sit on the board of the company that you are supposed to evaluate their performance?
On the recapitalization of DISCOs, we also made our position known to the federal government through the former Minister of Power, Works and Housing, Mr. Babatunde Fashola SAN, and he has made our position known to the federal government and has requested that the Ministry of Finance should look into it.
The good news is that recently President Muhammadu Buhari, through a statement signed by his Special Adviser on Media and Publicity, Mr. Femi Adesina, has vindicated TCN. You will see that the position of government at that level synchronises with ours, that there is need for re-capitalization of the DISCOs. We are happy that government at the highest level is actually interested on the need for the DISCOs to be re-capitalized.
QTN: Only last week DISCOs alleged that the frequent system collapse and the ugly incident in Benin caused by faulty reactor is as a result of poor transmission network?
ANS: TCN is holistically analyzing the issues connected to system collapse, especially the one that recently occurred in Benin. Also, we have told Nigerians that system collapsed cannot be completely eradicated. Mind you, TCN is operating without spinning reserve and there is no way the issue of system collapse can be completely eradicated without spinning reserve. I want you to know that the people who raised this issue are the ‘association’ of DISCOs and what is an association? TCN would not like to join issues with these kind of people. We have an understanding with the DISCOs that we are connected with and we will deal with them on the basis of grid connection agreement in consistent with the market rules. We are on journey that will lead us to our destination which is the grid rehabilitation and expansion programme, which is presently on on track and very soon we will get to that destination.
QTN: What is the status of the current power supply to DISCOs?
ANS: According to the simulation that we did in December 2017, the capacity of the grid was 8100MWs. As last December, the capacity of grid was 10,500MWs. Now it is about 8000MWs. Electricity is not like water that you store. You can only generate what you can consume, I have said this severally. You cannot generate more than what you can consume. If you have a 20KVA generator in the house and the load inside your house is 5KVA if you put on the generator it will generate 5KVA, it is as simple as that. This, is how power is, you cannot store it. You can only generate what you can consume, you cannot generate more than what you can consume and that is how power is. And that is why we are saying that the DISCOs must re-capitalize so that we can fix the capacity of the DISCOs.
On our transmission, rehabilitation and expansion programme, in Abuja for instance, has seen TCN signing 5 new contracts for new substations, meaning that implementation has started and for the first time we have some of the best companies wining contract like General Electric (GE). Now that TCN is signing contract, we should also expect that the DISCOs should also start signing contracts to expand distribution, because when we finish our own and they don’t deliver their own it means that there will be problem.
Ask yourselves here tonight, how many times have you Journalists seen DISCOs signing contract and commissioning sub-stations distribution networks? Non. So, when there is no investment in the networks and you don’t have to have it, of course we are not saying that that the DISCOs to fix their network before we fix our own. The reason is that transmission work is even more difficult than that of the DISCOS.
The reason is that transmission line takes longer time than building a distribution line. The DISCOs must have to have their own network and that if you want to know whether we are doing a job here go to Cotonu or Niger Republic and you will see a marvelous distribution network there. The power that is consumed in these 2 countries about 80% to 90% comes from Nigeria, you go there and is whether their power is qualitative or not which is largely determined by the quality of lines, this is the major problem that we have in the electricity mix in Nigeria. There is need to have commensurate investment by the DISCOs in the network otherwise all these capacities and expansion that we are we are doing will amount to nothing.
QTN: Recently, some DISCOs were suspend for infraction of market rules, have they mended their ways?
ANS: TCN is actually composed of 2 companies: The Transmission Service Provider (TSP) and Independent System Operators (ISOs). In the long run the 2 outfits will become separate entities and once that is done there would not be somebody called MD of TCN, as there will now be two MDs respectively. To achieve that autonomy we are working hard on the SCADA automation and to achieve adequate Spinning Reserve.
Under independent system operator, we have market operator who enforces market rules to ensure that settlement process works, meters that are in the sector are accurate and working very well. The suspension of 3 DISCOs was caused by the fact that security has collapsed and they were therefore suspended according to the market rules to ensure that this kind of thing does not happen again. This is a market rule and it must be followed. Because of the suspension doled out on them, they have corrected all the deficiencies that they used to have. They have paid the penalty and that is exactly how the market works, people must play by the rule.
QTN: What strategy is TCN putting in place to curb transmission losses?
ANS: TCN has been working very hard to curb transmission losses. For a long time the losses stood between 7 and 8 percent. To prevent losses, TCN is linking all the substations on a line so that at any point in time we should be able to know which place is contributing the highest energy loss. Now we don’t have all the money to buy all the equipment that is required across the country, however, we have decided to start with the biggest network where we have the highest loss, which is Lagos and the company is already procuring about 200 meters to meter all the interface in Lagos, which means every substation. This is being done because of the substations; people are now using some sub-contractors and sometimes theft of electricity can take place inside a substation when the control room staff is not patriotic but we want to know which we are having losses anywhere in the country.
QTN: Why are equipment failures rampart in the last few years?
ANS: It will interest you to know that for the first time we have developed our internal (local content) capacity to maintain and fixed our transformers. Remember that there was a transformer in Kano that caught fire in 2015? That transformer has been rehabilitated and brought back by TCN staff
and is serving people in Kano. Remember also that we have one transformer that failed in Kano few weeks before the 2019 election, it was also our TCN engineers that rehabilitated this through bringing the 15KVA transformer that failed about 5 years they brought it back and energize back before the election.
In Abuja here we had a transformer that failed in 2017, TCN engineers have brought it back and currently working in Kubwa where it was installed. Currently there are 2 transformers in Lagos that are not functioning, TCN engineers are there to fix it. What we have done in TCN is not only expanding the grid but we are building confidence in our engineers to be able to do things by themselves and that is why it is possible and this why we have been able to commission the largest substation on the Lagos Island substation and it was fixed by TCN engineers.
QTN: What has TCN done with the N72 billion rehabilitation, transmission and expansion programme?
ANS: Well, of course as you know the procurement of power expansion equipment takes time so all of them are still under procurement and some of them will actually take supply to Villa. The project has not been abandoned; we are still under procurement process.
QTN: Why is blame game and counter accusations by stakeholders in the sector unending?
ANS: It will also interest you to know that TCN, NERC, DISCOs/GENCOs, have a forum where we meet and just yesterday we meet with all of them as in the previous meetings. Usually, any complaints emanating within the sector is attended to them. At this point, let me tasks members of the media to always go for investigative journalism to really know where the problem lies.
Without mincing words, I can say that TCN in the last few years has achieved a significant level of transparency in the way it conducts its affairs. At TCN, things are not done under the table, our procurement processes are open. For instance, when we do commissioning of subsections, we invite members of the media to come and witness and report. How many of such invitations do you media get from the DISCOs? So when you say blame game, please go for investigative journalism to find out whether we are lying or not. For instance, take a look at Abuja that was built by FCDA as a modern city with underground channels, but once it rains here you will find out that 90% of Abuja will not have electricity supply, so who is doing blame game, please go ahead and do investigate.
QTN: What is your take on the concerns over the diplomatic tariff rate paid by neighbouring countries on power from Nigeria?
ANS: As you are aware, we supply Niger Republic electricity through Birin-Kebbi line and we also supply Republic of Benin through Ikeja West line. However, the 2 countries (Benin and Togo) have a joint transmission company that supplies power. The agreement was entered under diplomatic arrangement under the West Africa Power Pool (WAPP) which is like an investment arm like TCN, and also within the region we have a regulator. Last year, we launched the West African Energy Market which signaled an end to ground matter arrangement, meaning that all the countries in West Africa must shift their ground to bilateral agreement. Therefore, Benin and Togo must shift their agreements to bilateral agreement that is why we held a meeting and we agreed that it must be a diplomatic arrangement. The same thing with Niger Republic, because we have a shared vision arrangement because when the the Kainji and Jeba dams were being built, we have agreement with those countries where water passes through to Nigeria that they are not going to build another dam across the flow of that water. And so it was under that diplomatic arrangement that Niger Republic will not build another generating company along the river Niger because we are supposed to supply them electricity. Also going forward under the North corridor we are going to supply Burkina Faso, Niger and Benin and that will be done competitively under a bilateral arrangement, meaning that the generation that pass through that line and that is where we are and one thing that I want to tell you is that we have comparative advantage in terms of supply of electricity because we can actually generate electricity cheaper and sell to those countries and that is why the West Africa Power Pool is created to ensure that we can do business among ourselves.